Claims for biopsies, destructions, and pathology often come back denied or underpaid. Payers claim that the codes, modifiers, or documentation do not accurately reflect the services provided. Sometimes the medical reason is not clear on the claim. When that happens, work is bundled, downcoded, or simply not paid.
This guide explains why these errors occur and guides how to prevent them. It describes how biopsies, destructions, and pathology fit together. It then walks through the most common mistakes for each step and gives simple, practical fixes. You will find clear guidelines for selecting codes, using modifiers correctly, documenting clinical necessity, and managing pathology billing.
A biopsy is a procedure in which a small piece of tissue is removed to determine the cause of an issue. It can be a shave, punch, or excision. The note must say the technique, location, and why the sample was needed.
Use shave/tangential codes for tangential removal. Use punch codes for punch biopsies. Use excisional biopsy codes when the entire lesion and margin are removed as a biopsy. Label the technique in the note (e.g., “3 mm punch biopsy, left forearm”).
For multiple biopsies, document the location and technique of each lesion. If two lesions are present on the same visit, code each lesion with the correct code and add the proper modifier for additional lesions as needed. Clear location notes remove guesswork for auditors.
Put a short reason for the biopsy (e.g., “rule out basal cell carcinoma,” “changing nevus”) and the next step if positive. This links medical necessity to the code.
If a lesion is biopsied and later the entire site is excised during a separate visit, bill the excision as a new procedure and retain the biopsy billing for the date it was performed. If both happen the same day, check payer rules—some payers bundle these. Document the clinical need for both when both are medically necessary.
Use one-page coding cheat sheets that map techniques to CPT codes. Quick reference reduces selection errors.
Destruction refers to the removal of skin lesions through methods such as freezing, burning, or laser treatment. Codes depend on whether the lesion is benign or premalignant, as well as the number of lesions treated. Count and document each lesion and its location.
Use CPT 17000 for premalignant lesions and 17110 for benign lesions (1–14 lesions). For larger counts, different codes apply. Always code based on the lesion diagnosis (ICD-10) tied to the destruction.
Note exact counts and locations in the chart (e.g., “cryotherapy applied to 6 seborrheic keratoses on chest”). For grouped lesions, document the grouping and count logic (i.e., how they were counted). Payers often deny or audit high-volume destruction claims.
Some codes are assigned per lesion, while others are assigned per group. Check payer rules and if an add-on is required. For Medicare, follow local LCDs and national policy.
If a lesion was biopsied and then destroyed the same day, document why both were clinically needed. Many payers will review for duplicate services.
Pathology is the lab work that examines tissue and generates a report. Billing is separate from the clinic visit. The lab may bill the test, or the clinic bills the technical (TC) and/or professional (26) parts. Record who did the processing and who did the interpretation.
If the practice sends slides to an outside lab, the lab typically bills for pathology services. If the practice performs the pathology, split the claim components properly: the technical component (TC) for the lab work and the professional component (26) for the pathologist’s interpretation, when applicable. Use modifier 26 to report only the interpretation and modifier TC for only the lab portion, per payer rules.
The correct code depends on the complexity of the gross and microscopic exam (for example, level IV is often 88305). Keep a copy of the pathologist’s report with the correct code level recorded. If immunohistochemistry or special stains were performed, add the corresponding codes (for example, 88342 for IHC).
Record who fixed and processed the specimen, when it was sent to the lab, and who read it. Clear logs reduce denials related to specimen ownership and billing responsibilities.
Mohs surgery has special billing rules. When tissue is used for Mohs margin evaluation, submitting both Mohs codes and certain surgical pathology codes is inappropriate and may result in denial. Check Medicare/NCD guidance for Mohs coding.
NCCI edits prevent billing for two procedures that are typically part of a single service. Only apply 59/X modifiers when there is a true, documented distinct service (different lesion, different encounter, different organ, etc.).
XS = separate structure; XE = separate encounter; XP = separate practitioner; XU = unusual non-overlapping service. These are more specific than 59. Use the one that matches the real reason the services are distinct.
If the modifier is used, the chart must show why the two procedures were distinct. For example, mark different anatomic sites or describe why two separate encounters were required.
Provide examples of allowed and disallowed modifier usage. Run monthly audits of claims using 59 or X modifiers.
| Stage | Key Actions |
|---|---|
| Before the visit | Confirm payer rules; print payer-specific cheat sheet for high-volume payers. |
| During the visit | Document lesion description (size/shape/color), precise location, clinical reason, consent, procedure type (shave/punch/excision/destruction), lesion count, and whether tissue is sent to pathology. |
| Right after the visit | Label/specimen stamp with patient ID; log chain of custody; note lab name and tracking information if sending out. |
| Coding step | Use technique→code cheat sheet; assign CPTs by technique; add modifiers only if documentation supports them; choose pathology codes from the actual pathology report. |
| Billing step | Determine who bills pathology: practice (26/TC or both) vs outside lab (do not duplicate); include supporting ICD-10 codes for medical necessity. |
| Audit step | Run weekly denial report for biopsies/destructions/pathology; fix root causes (wrong CPT, wrong modifier, documentation gaps). |
Denied or underpaid claims cost time and money, but most problems are easy to fix. Match the technique to the corresponding CPT code and write the procedure exactly (e.g., shave, punch, excision, or destruction). Document the lesion’s size, spot, and why you did the test, and add a one-line “billing note” so coders know what to pick. Count and label each lesion when you destroy multiple spots, and record the location of the tissue if you send it to the lab. Determine who will bill the pathology (the lab or your clinic) and use modifiers like 26 or TC only when they are truly applicable. Use X or 59 modifiers only with clear reasons in the note. Finally, run a weekly denial report, provide the team with a short cheat sheet, and address the top errors you find. These small steps reduce denials and expedite correct payment.
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