Latest News

WPS acknowledges error in Local Coverage Determination for IHC coding

Posted by on Sep 17, 2014 in Latest News | Comments Off

Recently, WPS providers in Jurisdiction J5 and J8 began receiving denials of Medical Necessity on G codes submitted to Medicare for IHC stains performed on or after 8/1/2014.  After further review, the culprit was identified…Local Coverage Determination (LCD)  #L33219.

Labeled “Molecular Diagnostic Testing”, this LCD erroneously linked the G0461 and G0462 as medically necessary ONLY for the following three conditions: V16.0 (family history of malignant neoplasm of gastrointestinal tract), V84.04 (genetic susceptibility to other malignant neoplasm of endometrium), and V84.09 (genetic susceptibility to other malignant neoplasm).

WPS will be issuing a revision to the LCD that will be posted to its website by Oct 1, as well as reprocessing claims that were inappropriately denied since August 1.  The mass reprocessing should take place around the end of September.

WPS Jurisdiction J5 and J8 is the Medicare Administrator for these following states:  Iowa, Kansas, Missouri, Nebraska, Michigan, and Indiana.

Ann Lambrix is the Executive Client Administrator at Vachette Pathology, your go-to source for industry updates and changes. Visit our website for at or call us at 517.486.4262.

Audit Finds Florida Medicaid Is Erroneously Denying Claims

Posted by on Sep 15, 2014 in Latest News | Comments Off

A recent billing audit we conducted for one of our clients led to a very serious finding that affects all pathology practices in Florida. We learned that several new 2014 CPT codes for immunohistochemistry stains (G0461, G0462 and 88343) are not listed on the 2014 Florida Medicaid fee schedule.

This is causing Florida Medicaid to erroneously deny claims when:

  • A combination stain is billed to Medicaid.
  • Florida Medicaid is secondary to Medicare or any other carrier that accepts G codes for IHC stains.
  • G codes for IHC stains are billed to Florida Medicaid instead of using 88342.

These codes should be available for use as described in the 2014 CPT and HCPCS books:

88342 – Immunohistochemistry or immunocytochemistry, each separately identifiable antibody per block, cytologic preparation, or hematologic smear; first separately identifiable antibody per slide

88343 – Each additional separately identifiable antibody per slide (list separately in addition to code from primary procedure)

G0461 – Immunohistochemistry or immunocytochemistry, per specimen; first single or multiplex antibody stain

G0462 – Immunohistochemistry or immunocytochemistry, per specimen; each additional single or multiplex antibody stain (list separately in addition to code for primary procedure)

It is imperative that you audit claims for these codes and follow up on denials to ensure payment.

Vachette Pathology is an auditing and practice management firm working with practices in Florida and across the nation.  We are not a billing service — we make sure billing is done right.

For further information, contact Mick Raich at 866-407-0763 or  To keep updated on this and other current issues, read our latest news at or follow Mick Raich on LinkedIn.

Comparative Billing Report webinar on CBR201407 Immunohistochemistry and Special Stains hosted by eGlobalTech and Palmetto GBA

Posted by on Sep 12, 2014 in Latest News | Comments Off

Angela Granlund, Executive Client Administrator, Vachette Pathology

On Wednesday, August 27, 2014, CMS contractors eGlobalTech and Palmetto GBA hosted a webinar on CBR201407, a recent comparative billing report on Immunohistochemistry and Special Stains. A team from Vachette Pathology attended, including myself, and have the following to offer in summary.

Five thousand rendering pathologists, identified by National Provider Identifier (NPI), were chosen for this CBR.  Pathologists who did not receive this CBR did not meet the thresholds used to determine participation. These thresholds were not discussed or listed, however in the August G2 Compliance Advisor, the rationale given was simply because the participants’ billing patterns differed in some way from the national average of their peers.

The CBR focused on CPT codes 88305, 88312, 88313 and 88342, related specifically to esophageal and/or gastric biopsy specimens. Consultant cases were not included in this CBR.

The webinar began with a review of CPT coverage criteria: basics regarding policies of how and when to submit, medical necessity, billing protocols, etc.

The next topic covered was the methodology for determining the Average Allowed Charges per Episode of Care by CPT Code, the Average Allowed Services by CPT Code per Episode of Care, and the Percentage of Episodes with Special Stains.

  • Average Allowed Charges per Episode of Care by CPT Code:
    Determined by Total # Charges divided by Total # of Episodes for all CPT codes
  • Average Allowed Services by CPT Code per Episode of Care:

Determined by Total # Services for single CPT code divided by Total # Episodes with that CPT code

  • Percentage of Episodes with Special Stains:
    Determined using the counts of Episodes with at least one special stain

Unfortunately the webinar included no visuals, as the link to the slides was not provided until after it ended. Provider results were discussed using random examples, yet the slides could not be seen.

The provider results fell into one of four categories: Significantly Higher, Higher, Does Not Exceed or N/A.  The impression given, although not specifically stated, is that if you have codes with results that are Significantly Higher, that this is a “bad” thing.

In discussion with other attendees here in the Vachette office, we agreed this may not necessarily be so. There are at least two reasons providers may have higher results:

  • All data is related to the individual NPI, so whether the provider works for a hospital-based group or an independent lab or both does not seem to be taken into consideration for the comparison to state or national averages.
  • The results also do not seem to take into consideration if the provider works specifically with an endoscopy center and therefore may have higher results by default.

We also believe that this CBR is related to the article Palmetto GBA had on its website briefly which indicated that if you perform a high number of stains for gastric biopsies, then your practice would be looked at more closely.  We feel they will use this data to target providers for audit.

Takeaways for providers:  If you received a CBR, it is in your best interest to take the following steps:

  • Review all coding policies for IHC stains
  • Perform a coding audit on these types of cases to ensure they are indeed meeting these standards, and
  • Continue to follow eGlobalTech (the CMS contractor) for any future lab-related reports

A recording of the webinar is available for download at the link below, along with additional data on this CBR:

Webinar Recording:

CBR website:


Statistical Debriefing:


New Distinct Procedural Modifiers

Posted by on Sep 10, 2014 in Latest News | Comments Off

By Jessica Jankowski, Executive Client Administrator, Vachette Pathology

We all know or understand the basic idea of The Medicare National Correct Coding Initiative (NCCI), which establishes edits that are used to bundle service codes together.  The basis for this is to outline certain billing codes that cannot be billed with other codes, indicating codes that further define some portion of the first code.

The modifier -59 has always been a go-to modifier to indicate a second service code is indeed distinctly different or separate from the first service code. Per CMS’ recent MLN Matters published January 2014, this modifier “can be broadly applied,” and CMS believes that some providers will use this modifier “to bypass NCCI,” thus allowing for abuse and “high levels of manual audit activity” (MLN Matters Articles, 2014).

CMS is correct in their statement.  The -59 modifier has a broad realm for use, and can be used to identify different encounters, different anatomic sites, and distinct services.  Per CMS, the -59 modifier is seldom used properly, and therefore CMS will bring into play four new modifiers that will further define or describe the -59 modifier.  These will further be known as the –X modifiers (MLN Matters Articles, 2014).  The modifiers and their descriptions are listed below:

  • XE:  Separate Encounter.  A service that is distinct because it occurred during a separate encounter.
  • XS:  Separate Structure:  A service that is distinct because it was performed on a separate organ/structure.
  • XP:  Separate Practitioner:  A service that is distinct because it was performed by a different practitioner.
  • XU:  Unusual Non-Overlapping Service.  The use of a service that is distinct because it does not overlap usual components of the main service.

According to the MLN Matters, these modifiers will be used in place of -59 when appropriate.  Furthermore, CMS will still identify the -59 modifier when used; however, it is important to note that it is of great importance to use a more descriptive modifier when there is one available.  We may even see CMS require these –X modifiers on specific CPTs that they feel are at a higher risk for incorrect modifier usage.

Bottom line:  Understand these new modifiers and how they are used, and make sure your biller is aware of these and using them when appropriate.


MLN Matters Articles. (2014, 01). Retrieved 09 2014, from The Centers for Medicare and Medicaid Services :


Medically Unlikely Edits: Medicare Issues Updates July 2014 – How Will They Impact You?

Posted by on Sep 3, 2014 in Latest News | Comments Off

CMS has developed “Medically Unlikely Edits” to limit the maximum units of service a provider can report under most circumstances for a single beneficiary on a single date of service.

As announced in MLN SE1422, titled “Medically Unlikely Edits (MUE) and Bilateral Procedures,” for dates of service starting July 1, 2014, CMS is converting most MUEs into per day edits, with the MUE Adjudication Indicator (MAI) value indicating the type of and basis for the MUE.

CMS has defined three MAI values:

MAI of 1. MUE is based on a line edit and medically appropriate units of service in excess of the MUE. May be reported on a separate line with an appropriate modifier, and each line will process for payment.

MAI of 2. MUE is based on regulation or sub regulatory instructions.

MAI of 3. MUE is based on clinical information such as billing patterns, prescribing instructions, or other information, and exceptions beyond the MUE would be rare.

For example, IHCs: G0461 is limited to 9 units per date of service, whereas G0462 is limited to 60, with an MAI of 3.

Billers should be aware of these MUE edits and upon denial, review claim submissions and either request to reopen the claim for processing, or appeal with documentation to support excess units for medical necessity.

Ann Lambrix is the Executive Client Administrator at Vachette Business Services and Stark Medical Auditing, your go-to source for industry updates and changes. Visit our websites at and, or call us at 517.486.4262.


A Mid-Year Review of the Sample Impact Analysis for the 88342 / G0461 and Changes

Posted by on Aug 12, 2014 in Latest News | Comments Off

 Mick Raich, Vachette Pathology

Earlier this year I wrote a brief article on the changes with 88342 and the new G codes G0461 and G0462.  This article proved very insightful to me and many others.  It helped me understand how I was looking at things incorrectly, and it helped our client practices understand their revenue shortfalls.

It has been six months since that piece; let’s take a quick look back at the revenue losses we predicted, compared to actual loss.  Remember this is only for Medicare payments.

We reviewed a lab which bills globally and predicated a loss of $159,000.  Originally we figured their losses as of May 2014 would be about $16,611. In actuality, their loss is $16,248.  See the graph below.

global ihc tracking


For a group which bills professionally, we only predicted a loss of about $14,000 by May 2014.  In actuality the loss is $19,000.  See the graph below.

professional tracking

As you see with these two examples, most of our loss predictions were less than actual losses.  When tracking these things you have to be careful to look at date of service data and to look for claims that have already been fully adjudicated.

We find that many of our groups and their billers are still suffering from a bad process to handle these cases.

We have about 70 groups, labs and hospitals under contract, and we provided these projections to them last year.  Currently we are tracking losses for all our clients.  We are also aggressively auditing our clients each quarter to find missing and denied cases that have not been appealed.  There are millions of dollars left on the table in this area.

Here is exactly what you should do to track these cases and prevent these losses.

Sample IHC Auditing Process

1. Request cases from physician.

a. Request an appropriate number of pathology reports that have IHC CPT codes assigned. (Please note our groups are auditing ALL of their IHC cases.)

i. Dates of service should be at least six months prior to the audit start date.

ii. Reports should be randomly selected (the biller should NOT be involved in the selection process).

2. Receive initial cases from physician.

3. Send initial cases to biller requesting the following documentation:

a. HCFA form;

b. explanation of benefits from primary and secondary insurance with adjustment codes;

c. and patient transaction or history screen that shows payment and adjustment posting and current balance.

4. Receive initial case information from biller.

5. Match case information.

a. Attach the biller’s documentation to the pathology report received from the physician’s office.

b. Compare reported IHC CPT codes to billed CPT codes to confirm the correct CPT codes have been billed according to IHC guidelines.

c. Confirm correct number of units have been billed to carrier according to IHC guidelines.

d. Confirm correct IHC CPT codes were billed to Medicare or the insurance carrier according to insurance carrier guideline. (This is the hard part and where you must build a matrix to review each carrier.)

e. Confirm date of service to verify correct IHC CPT codes were billed to carrier per IHC guidelines.

f. Confirm insurance is allowing all units billed for IHC CPT codes.

g. Compile questions that require further explanation from biller.

6. Send initial questions to biller.

7. Receive question documents back from biller.

a. Review answers from biller and document case audit finding.

8. Complete case audit.

a. Categorize case audit findings and report in audit summary.

9. Perform payer analysis by EOB.

a. Confirm IHC CPT allowed amounts by insurance are being paid according to the managed care contract reimbursement language.

10. Track every case to payment or bad debt and zero balance

The best option is to audit your billing, then work forward.

I will release a final version of this comparison in February of 2015 to review actual dollars lost compared to our total predictions.

Although these types of predictions are not always 100% correct, it is important to at least considering your losses and be proactive.  For example, next you should be looking at the proposed CMS fee schedule for 2015 and building projections for those cuts.

If you have any questions please contact me, Mick Raich, at 866-407-0763 or 517-486-4262 or

Sequestration Frustration in Minnesota Impacts Pathology Revenue

Posted by on Jul 25, 2014 in Latest News | Comments Off

It appears Blue Cross and Blue Shield of Minnesota (BCBSMN) has made a significant error in Medicare reimbursements and has just recently realized it.

In May 2014, BCBSMN notified providers they will begin withholding a 2% Medicare payment reduction mandated by sequestration to all claims processed after June 6, 2014 — even though sequestration began April 1, 2013.

Plus, BCBSMN will be recovering the 2% reduction on Medicare claims with dates of service October 1, 2013, and later. However, they will only be targeting claims with a net payment of $100 or greater.

Sorry pathologists – their error is now your problem. Claim adjustments began the week of June 16, 2014. Look for your BCBSMN payment to decrease.

View the notification at:

As an auditing and practice management firm that works with pathology groups, laboratories and hospitals in Minnesota and across the nation, Vachette urges you to ensure your billing company is watching this, as well as verifying the 2% reduction in other Medicare Advantage plans.

If you have questions, please feel free to contact us at 866-407-0763.

Follow me, Vachette President Mick Raich, on LinkedIn to see more auditing updates.

What is a Virtual Credit Card Payment?

Posted by on Jun 27, 2014 in Latest News | Comments Off

Wendy Payette, Director of Auditing
Vachette Pathology / Stark Medical Auditing

Our clients are asking about a new phenomenon — insurance companies who send an explanation of benefits (EOB) with “virtual” payment.  The EOB will state, “payment for this remittance is being made via virtual credit card; please process this payment as you would any credit card.”

This brings up several areas of concern.  First, what if you don’t take credit cards?  Some practices have not progressed this far, and they do not have the ability to accept these virtual payments.

Second, you have to pay a fee to get this money; whenever you process credit card payment, you are charged a merchant fee, typically 2.5-3%.  This fee comes out of your payment, lowering your margin.

Also, unlike other credit card payments, you must make a call to get paid. Calling the payer to get the amount approved takes time.

Finally, these virtual credit cards expire after about two months.  This means if you don’t call and process the transaction, you lose the payment entirely.

Why do payers use virtual credit cards?  By not sending a check, they may actually be hoping the biller will never make the call, therefore they do not have to pay the physician. Remember, calling the payer actually increases the cost of billing.

The simpler and easier thing to do is to sign up for electronic funds transfer (EFT) for payments.  This makes the payment process much easier and eliminates the merchant fee altogether.

Do you have questions about virtual credit card payments? Contact Mick Raich, President of Vachette Pathology and Stark Medical Auditing at 866-407-0763.

Are You Losing Revenue from Improperly Handled Denials?

Posted by on Jun 17, 2014 in Latest News | Comments Off

By Michelle Miller, Vice President
June 13, 2014

During a recent audit for one of my clients, I was working through some random CMS denials and noticed that several special stains had been denied. There were eight units billed and ALL had been denied by CMS and adjusted by the biller. Yet I know that the CMS National Coverage Determination (NCD) allows billing for one unit – why was that unit not approved?

I spoke with the billing agency and was informed that CMS will typically deny ALL charges — even if one should be approved — until the appeal is made. If the documentation supports the additional units, then CMS will make payment on all the unit(s).

Typically, when a biller receives a denial letter from CMS, they begin to step through the five levels of appeal, starting with Redetermination. The biller sends copies of supporting documentation for the denied CPT code(s), and if the documentation supports medical necessity, CMS will make payment. If not, the denial is upheld, and the biller will move on to the next level of appeal, Reconsideration, and so on down the line until the claim is paid, or all levels of appeal have been exhausted.

There is one key factor to the CMS appeals process – the initial Redetermination request must be filed with 120 days of the initial denial.

The denials I reviewed were from December 2013. The date today is May 16, 2014. The billing agency failed to appeal the denied charges within the allotted 120 days. At this point, we’ve lost out not only on getting paid for all units billed, but also on getting paid for the one allowed unit.

While these denials are for CMS, imagine how many this billing agency receives for the rest of the insurance carriers they file to. What are each carrier’s appeal rules? Have we missed any other filing limits for the appeal process? How much money is lying on the table right now?

Who’s watching your denials? If you do not regularly review and discuss denial reporting with your billing agency, you will lose revenue. The billing agency should be able to provide feedback and information regarding the denials they are receiving from all insurance carriers they bill.

Michelle Miller is the Vice President of Vachette Pathology and Stark Medical Auditing. Our company specializes in auditing billing for hospitals, independent testing facilities, and hospital-based providers.  Visit our websites: and Our direct line is 866.407.0763.

Billing for FSH Testing (CPT Code 88368) — Validate Your Assay

Posted by on Jun 16, 2014 in Latest News | Comments Off

By Jessica Jankowski, Senior Practice Manager Vachette Pathology

Since January 2014, there are more and more issues coming out of the woodwork with FSH billing and reimbursement.  Earlier this year, we saw United Health Care (UHC) create their own application of an MUE to any CPT Code 88368 billed more than once per patient per day.  While UHC is now in the process of recanting this, we are continuing to see Blue Cross Blue Shield of South Carolina (BCBS SC) deny 88368 as investigational.

According to BCBS SC, they are taking issue with an assay component used in some FSH testing that requires a more “clear association with clinical outcomes” (Blue Cross Blue Shield South Carolina , 2013).  The policy goes on to further state that “the clinical utility of the HERmark® assay has not been demonstrated, and clinical trials are needed to determine the impact on the clinical outcome of patients stratified by the HERmark® assay” (Blue Cross Blue Shield South Carolina , 2013).

There are two problems that I see in this policy:

1) The policy is based on the use of the HERmark® assay for FSH testing and only this assay, and

2) The HERmark® assay test is not an FDA-approved test; it is considered a homebrew test (Blue Cross Blue Shield South Carolina , 2013).

My question to BCBS SC is, how can they assume every FSH test done by a pathologist uses only the HERmark® assay?  And one that is not even FDA-approved?  Can they truly believe this is the only method?  In fact, there are other FDA-approved FSH assays being used, such as PathVysion™, Inform®HER2/neu and as well as Dako’s HER2 IFSH pharmDx™ assay technology (FDA, 2010).

In an effort to appeal the denials of BCBS SC, we recommend that billers provide data showing the type of FSH assay used, as well as information validating the FDA-approval of the assay.

For further information contact Jessica at Vachette Pathology 517-486-4262.


Blue Cross Blue Shield South Carolina . (2013, December). Medical Policies . Retrieved June 2014, from

Dako. (2013, February ). Dako: an Agilent Technologies Company . Retrieved June 2014, from About Dako :

FDA. (2010, October ). Medical Devices . Retrieved June 2014, from U.S food and Drug Administration :