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Coding Tips: Treatment of Skin Lesions

Just a friendly reminder on lesion destruction/shavings/removal/excision:

Medicare will only cover the removal (17000/17003 and 17110) of seborrheic keratosis if it is inflamed. Medicare will NOT pay for code L82.1 ("Other seborrheic keratosis") and will only pay for L82.0 ("Inflamed seborrheic keratosis"). Furthermore, skin tag removal is only paid for is the skin tag is documented as painful, irritated, bleeding etc.

Here are some guidelines for other common epidermal conditions: (Taken from LCD Medicare Policy #L33979)

SKIN LESIONS Benign skin lesions are common in the elderly and are frequently removed at the patient's request for cosmetic reasons. Cosmesis is statutorily non-covered and no payment may be made for such removal. Benign skin lesion removals for reasons other than those given above are considered to be cosmetic and will not be covered. These reasons include, but are not limited to, emotional distress, "makeup trapping," and clearly benign lesions lacking any component of functional compromise in any anatomic location. Medicare will consider the removal of benign skin lesions as medically necessary, and not cosmetic, if one or more of the following conditions (A-E) is present and clearly documented in the medical record. A. The lesion has one or more of the following characteristics:\

  1. bleeding \

  2. intense itching \

  3. pain B. The lesion has physical evidence of inflammation, e.g.; purulence, oozing, edema, erythema, etc. C. The lesion obstructs an orifice or significantly and objectively restricts vision. D. The clinical diagnosis is uncertain, particularly when malignancy is a realistic consideration based on lesional appearance or change in appearance or non-response to conventional treatment. However, if the diagnosis is uncertain, either biopsy or removal may be more prudent than destruction. E. A prior biopsy or other examination suggests or is indicative of malignancy or pre-malignancy. F. Coverage of wart removals. Wart removals are covered only if one of the above (A-E) is documented in the medical record under one of the following clinical circumstances.

G. Sebaceous cyst (ICD-10-CM L72.0, L72.2, L72.3 and L72.8) are included in both Lists I and List II. The code is accompanied by an asterisk (*) and an addendum noting parameters of coverage for removal. If the cyst is greater than 2.0 cm in diameter, no secondary diagnosis is required. On the other hand, if the lesion is 2.0 cm or less, List II requirements must be met in order to support coverage and payment.

So that you are aware of our process - we will code appropriately for these procedures and problems and submit the claims as accurately as possible, but we have run into a couple instances when Medicare denied payment. Then, per our protocol, we attempted an appeal by submitting medical records to support the medical necessity of these procedures. However, upon further review of the documentation the lesion/skin tag etc was not documented as being painful or itchy or irritated and we were forced to accept the denial. This has happened twice now and we are hoping to avoid this problem in the future by educating everyone what constitutes as medically necessary with epidermal lesions.

If the patient wants to have a lesion removed because it is unsightly or bothersome (but does not actually cause pain/bleed/itch and you do not feel it is concerning) then we advise you collect an ABN so that the patient will agree to pay for the removal/destruction when Medicare denies based on medical necessity.

If you are interested in the full policy guidelines, below is a link you can copy and paste into your browser.

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