Did you know that according to the American Association of Hospitals, nearly 84% (5,121 out of 6,100) of the healthcare facilities are community hospitals? Many of these hospitals provide outpatient services, caring for new and established patients with a wide range of healthcare needs.
As outpatient visits continue to account for a significant share of patient care, accurate medical coding and billing become increasingly important.
One of the key codes used in this setting is CPT code 99205, which reports office or other outpatient evaluation and management (E/M) services provided to a new patient.
Like all CPT codes, 99205 has its billing requirements, applicable scenarios, and specific modifiers that billing professionals must pay heed to.
CPT Code 99205 – Description
According to the AAPC’s official code descriptor, CPT code 99205 is the highest-level office or outpatient E/M code for a new patient. The term “new patient” refers to a person who has not received professional services in three years from the same physician or another physician or qualified healthcare professional (QHP) of the same specialty and subspecialty within the same group practice.
During the 99205 service, a healthcare professional tends to a patient for:
- An office visit involving evaluation and management.
- A high level of medical decision-making.
- At least 60 minutes of total physician or QHP time on the date of the encounter.
The Code Selection Criteria for CPT Code 99205
Billing professionals can determine code selection by using one of the two paths:
- High level of medical decision-making (MDM)
- Total time of service
To use the CPT code, a high-level MDM or total time (60-74 minutes) on the date of the encounter must be reported, not both simultaneously.
Scenarios Where CPT Code 99205 is Applicable
Appropriate use of CPT code 99205 largely depends on understanding its applicable scenarios. Here are three examples of appropriate scenarios where 99205 applies:
New Patient with Multiple Chronic Conditions
Imagine the case of a new 68-year-old female patient who visits an outpatient facility for multiple chronic conditions. The patient has worsening heart failure, stage 4 chronic kidney disease, and uncontrolled type 2 diabetes.
Therefore, the provider:
- Reviews outside records
- Interprets diagnostic testing
- Consults with a cardiologist
- Initiates intensive treatment requiring close monitoring.
For the treatment, an intravenous diuretic therapy requiring intensive monitoring for toxicity is initiated. After the service, CPT code 99205 is used to bill the payer.
New Patient with High-Risk Acute Condition
Consider the case of a 59-year-old, new male patient who presents to the outpatient facility. The patient complains of shortness of breath and severe chest pain, suggesting acute coronary syndrome. Thus, the provider:
- Analyzes cardiac tests
- Independently interprets an ECG
- Reviews the patient’s external records
- Consults a cardiologist
Considering the patient’s condition, the healthcare provider immediately arranges hospitalization for definitive treatment. CPT code 99205 is supported by the high-complexity MDM associated with this life-threatening condition.
New Patient with Extensive Data Review
A 64-year-old male new patient appears for evaluation at the outpatient facility for recurrent syncope with documented ventricular tachycardia. Considering the patient’s condition, the provider:
- Reviews hospital and cardiology records
- Discusses care with the electrophysiologist
- Independently interprets an ECG
- Analyzes diagnostic studies
Following the discussion, an urgent hospitalization is recommended for the patient’s treatment. Later on, the billing team uses CPT code 99205 when billing the payer.
New Patient Visit for Comprehensive Evaluation
For our last example, consider the case of a 72-year-old male who visits an outpatient internal medicine clinic as a new patient. He presents with conditions such as weight loss, progressive memory loss, and functional decline, all of which are reported by his daughter. Therefore, the attending physician decides to perform a comprehensive evaluation.
The 65-minute-long physician encounter involves:
- Review of extensive outside records (brain MRI reports and lab test results)
- Recording a detailed history from the patient and his daughter
- Performance of physical exams
- Conducting a Mini-Mental State Examination (MMSE)
- Discussion on suspected neurodegenerative disease
- Addressing family concerns and next diagnostic steps
- Ordering a PET scan
- Referral to a behavioral neurologist
Therefore, based on the comprehensive nature and time duration of the E/M visit, the billing team reports CPT code 99205 for billing and reimbursement.
Applicable Modifiers for CPT Code 99205
Modifiers have a direct impact on payment processing and reimbursement. For CPT 99205, the following modifiers may apply, according to the Centers for Medicare & Medicaid Services (CMS) fact sheet.
| Modifier | Description |
|---|---|
| 24 | Unrelated E/M service (CPT 99205) performed by the same physician during the postoperative period of another procedure. |
| 25 | Significant, separately identifiable E/M service (CPT 99205) provided on the same day as another procedure or service. |
Important Note: Telehealth modifier requirements (such as 95 or 93) vary by payer and the current CMS policy. Similarly, modifier 53 may be reported if required by the payer.
CPT Code 99205 – Billing & Reimbursement Guidelines
The CPT code can only be reported with documentation supporting medical necessity and reimbursement.
Documentation Requirements
As stated earlier, MDM or time may be used for code selection. For this reason, the documentation requirements may vary for either case.
Time-Based Billing Documentation
When billing based on time, the note should clearly indicate that the visit level was selected based on the total time spent with the patient. Documentation should include:
- Total physician/QHP time
- Statement that the code was selected by time
- Activities counted toward total time
- Medical necessity
- Exclude separately billable services
MDM-Based Billing Documentation
When billing based on MDM, the clinical notes should show the complexity of the patient’s care. Documentation should include:
- Problems addressed
- Data reviewed
- Risk level
- Assessment and plan
- Clinical reasoning
Time-Based Billing
The service should include at least 60 minutes of the total provider time on the date of encounter. Staff time does not count. If the service extends beyond 74 minutes, the add-on code 99417 should be used for prolonged service.
MDM-Based Billing
Requires high-complexity MDM and should meet two of three elements (i.e., data reviewed, problems addressed, risk at the high level).
Payer-Specific Requirements
The billing requirements may also vary for each payer and be subject to change. Therefore, billing staff should always verify payer-specific requirements before reporting 99205.
Wrapping It Up
CPT code 99205 is the highest-paying E/M code in the new patient category, but it triggers audits for incorrect billing. Its use depends on MDM or total time and should be supported with medical records.
Incorrect usage of this CPT code could lead to a claim delay, rejection, or even an audit against your practice. If your in-house team struggles with accurate billing and coding, MediBillMD’s medical billing services can streamline the process, resulting in improved claim acceptance rates.
