Outpatient surgery that’s canceled before anesthesia is potentionally going under the microscope of all recovery audit contractors (RACs). CMS on June 4 added complex reviews of the coding and documentation of discontinued procedures prior to the administration of anesthesia to the list of approved RAC issues.

Medicare pays hospitals half the outpatient prospective payment system rate for procedures if patients have been prepped and taken to the room where the procedure will be performed, but it’s canceled before anesthesia because of unforeseen circumstances, says Wanda Cidor, a manager with Deloitte & Touche in Pittsburgh, Pennsylvania. For example, if a medical problem surfaces in the OR, or a piece of equipment fails, the use of modifier 73 will ensure hospitals and ambulatory surgery centers (ASCs) still receive half the reimbursement for the procedure. “But they can’t apply the modifier if there’s a scheduling issue or an emergent procedure for another patient necessitates the use of the procedure room,” she says.