Answer: The problem could be your modifier. Make sure the otolaryngologist is using modifier 57 (Decision for surgery) on claims involving a major surgery, a code that has a 90-day global period as indicated in the 2007 Medicare Physician Fee Schedule. If the surgery is really a minor procedure, a code that contains zero or 10 global days, modifier 25 (Significant, separately identifiable E/M service by the same physician on the same day of the procedure or other service) instead applies.
With 25, the E/M must be significant and separate from the minor preoperative evaluation that the surgery includes. Although CPT does not require different diagnoses with a modifier 25-E/M, the insurer may require a separate diagnosis to cover the -unrelated- same-day E/M.
Modifier 57 indicates that although the hospital visit is usually part of the surgery's 90-day global period, the physician made the decision for the surgery during that encounter, making the E/M service separately reportable.
Example: The otolaryngologist admits a patient with parotitis to the hospital. Three days later, the patient develops a parotid abscess that requires draining. After examining the patient on rounds, the otolaryngologist makes a decision for surgery (to drain the abscess in the operating room). She indicates that at the hospital visit she made the decision for surgery by appending modifier 57 to 99231-99233 (Subsequent hospital care, per day, for the E/M of a patient), which she reports in addition to the major surgery (42305, Drainage of abscess; parotid, complicated).
But if the surgeon drained the abscess at the patient's bedside, she would instead use 42300 (- parotid, simple), which has a 10-day global period. If the physician performed and documented the hospital care as significant and separate from the drainage, she could append modifier 25 to 9923x. Without a separate diagnosis, the payer may include the E/M in 42300's allowance.
Alert: If you are properly using modifier 57 on a major surgery and the carrier still denies the E/M, you should appeal. The denial could be a bug in the Medicare carrier's system. Some practices have noted this problem, so make sure it's not the payer that's making the mistake.