Why Modifier 25 Stops Being Free

If you bill office visits next to minor procedures, there is a two-character flag on about a quarter of your claim lines that has never cost you a dollar.

CMS is proposing to put a price on it.

Modifier 25 says an office visit was significant and separately identifiable from the procedure done the same day. Appending it has always been a documentation question, answered in the chart note and argued about with auditors after the fact. Three pages of the CY2027 physician fee schedule proposed rule, headed "Accounting for E/M Resource Overlap Between Stand-Alone Visits and Global Periods," make it a pricing question instead: when a separately identifiable office or outpatient visit is furnished by the same physician, or a physician in the same group practice, on the same day as a 0-, 10- or 90-day global procedure, "the most expensive service (either surgical or E/M visit) would be paid at 100 percent, and all other surgical procedure(s) or E/M visit(s) would be paid at 50 percent."

Comments closed a month ago. The final rule has been at OMB since September 29.

CMS works the example itself, with a dermatologist: a 99212 at 1.78 non-facility RVUs alongside two shave removals, 11300 at 2.89 and 11301 at 3.48. The 11301 pays in full. The 11300 drops to 1.445 and the visit drops to 0.89.

"How much of your office-visit book is already priced as the second procedure?"

We ran the CY2025 Physician/Supplier Procedure Summary, all 14,474,585 rows of it, and counted every office-visit line in the country carrying modifier 25 in either modifier field. That is 55.6 million services and $5,619,189,556 in allowed charges, which is 22.7% of the entire national office and outpatient E/M book.

The three specialties CMS named, and the three the claims name

At 91 FR 44248 CMS says the policy "would have the largest negative impact on otolaryngology, dermatology, and podiatry, and to a smaller extent, hand surgery, physicians assistant, and colon and rectal surgery." No dollar figure goes with it, and the specialty impact table it points to, Table D-B5, is published as four scanned graphics, so there is nothing in the rule text to check against.

Run it off the claims instead and the same three specialties come out on top (chart below). Dermatology bills modifier 25 on 60.9% of its office-visit dollars, otolaryngology 55.2% and podiatry 42.0%, against a national average of 22.7%.

Hand surgery at 35.2% and colorectal surgery at 32.0% are exactly where CMS put them, one tier down.

Two specialties CMS left out of that sentence sit in the same tier. Allergy and immunology runs 48.3%, and micrographic dermatologic surgery, which bills under its own specialty code, runs 58.0%.