Respiratory therapy services provided in a facility are usually the responsibility of the facility’s nursing staff and/or respiratory therapy department.

Payment to a physician may be allowed for respiratory services only when the services are rendered as an integral although incidental part of the physician’s professional services in the course of diagnosis or treatment of an injury or illness. It is expected that respiratory therapy services will most often be used in cases of acute respiratory disease or acute exacerbation of chronic disease. Nevertheless, selected chronic stable conditions could require the services. Acute disease states are expected to either subside after a short period of treatment, or, if no response occurs, transfer the patient to a higher level of care.

Respiratory therapy services performed in a nursing facility or office setting may be eligible for payment to a physician if one of the following conditions is met:

• The service is personally performed by the physician or qualified Non-Physician Practitioner (NPP) if provision of the service is within the scope of his license.
  Or,
  
• The service is performed by ancillary personnel employed by the physician, under the direct personal supervision of the physician, and is furnished during a course of treatment in which the physician performs an initial service and subsequent service(s), which reflect his active participation in and management of the course of treatment.

CPT code 31720 is payable only if it is personally performed by the physician (or qualified NPP).

Medically necessary reasons for pulse oximetry include:

• Patient exhibits signs or symptoms of acute respiratory dysfunction such as:
  • Tachypnea.
  • Dyspnea.
  • Cyanosis.
  • Respiratory distress.
  • Confusion.
  • Hypoxia.
• Patient has chronic lung disease, severe cardiopulmonary disease, or neuromuscular disease involving the muscles of respiration, and oximetry is needed for at least one of the following reasons:
  • Initial evaluation to determine the severity of respiratory impairment.
  • Evaluation of an acute change in condition.
  • Evaluation of exercise tolerance in a patient with respiratory disease.
  • Evaluation to establish medical necessity of oxygen therapeutic regimen.
• Patient has sustained severe multiple trauma or complains of acute severe chest pain.
• Patient is under treatment with a medication with known pulmonary toxicity, and oximetry is medically necessary to monitor for potential adverse effects of therapy.

NOTE:

Codes 94760 and 94761 are bundled by the Correct Coding Initiative (CCI) with critical care services. Therefore, codes 94760 and 94761 cannot be paid separately when billed with critical care (codes 99291 and 99292).

CPT code 94762 is considered medically necessary when performed for any of the following reasons:

• The patient has a condition for which intermittent arterial blood gas sampling is likely to miss important variations.
• The patient has a condition resulting in hypoxemia and there is a need to assess supplemental oxygen requirements and/or a therapeutic regimen.

The results of tests performed by a durable medical equipment supplier or his employees to qualify patients for home oxygen service are not covered.

Reasons for Noncoverage

Services provided for conditions not outlined on this policy will be denied as not medically necessary. A provider cannot bill the member for the denied service unless the provider has given advance written notice, informing the member that the service may be deemed not medically necessary and providing an estimate of the cost. The member must agree in writing to assume financial responsibility, in advance of receiving the service. The signed agreement, in the form of a Pre-Service Denial Notice, should be maintained in the provider's records.

Utilization Guidelines
Payment for code 31720 may be allowed, on an individual consideration basis, for respiratory treatments for three consecutive days or three identical services within a 30-day time frame. Additional payment may be allowed for respiratory therapy treatments exceeding these parameters only if medical necessity can be established by medical documentation. In the case of consecutive days of care, the medical record should indicate why the patient was not transferred to a higher level of care.

In outpatient or home management for patients with chronic cardiopulmonary problems, oximetric determinations once or twice a year are considered reasonable. In all instances, there must be a documented request by a physician/NPP in the medical record for these services. Regular or routine testing will not be allowed for reimbursement. In all circumstances, testing would be expected to be useful in the continued management of a patient particularly in acute exacerbations or unstable conditions (e.g., acute bronchitis in a patient with Chronic Obstructive Pulmonary Disease (COPD)) where increased frequency of testing would be considered, on an individual consideration basis, for coverage purposes.

Only one service (oximetry determination) per day will be allowed for testing at a reasonable frequency and if medically necessary regardless of whether the patient is sitting, standing or lying, with or without exercise or oxygen use, unless medical necessity can be demonstrated for additional needs on an individual consideration basis.

More frequent testing may be allowed, on an individual consideration basis, when there is documentation of an acute exacerbation of a chronic pulmonary disease or other acute illnesses with signs indicating or suggesting increased hypoxemia.

Documentation Requirements

Documentation that supports the medical necessity of the respiratory therapy services and shows it is an integral although incidental part of the physician’s professional services must be included in the patient’s medical records and be available upon request. In addition to the physician’s initial assessment (history and physical examination), the documentation might include:

• Physician’s orders.
• Plan of treatment.
• The patient’s response to treatment.
• An ongoing assessment for the patient’s continued need for treatment.
• In case of consecutive days of care, the medical record should indicate why the patient was not transferred to a higher level of care.
• Documentation of frequency must be consistent with the patient plan of care.

When multiple medications are administered and the medications cannot be mixed and administered at one time, the patient’s records must be documented to explain the medical necessity for the separate administrations.

Payment can be allowed for code 31720 only if supporting documentation demonstrates the service was personally performed by the physician or NPP when this service falls within his scope of practice.

Continuous Overnight Oximetry (94762) 
The patient's record must document that the oximeter is preset and self sealed and cannot be adjusted by the patient. In addition, the device must provide a printout that documents an adequate number of sampling hours, percent of oxygen saturation and an aggregate of the results. This information must be available if requested. In all instances, there must be a request documented in the medical record from the treating physician for these services.

NOTE:

This policy is designed to address medical guidelines that are appropriate for the majority of individuals with a particular disease, illness, or condition. Each person's unique clinical circumstances may warrant individual consideration, based on review of applicable medical records.

Title XVIII of the Social Security Act, Section 1862(a)(7). This section excludes routine physical examinations.

Title XVIII of the Social Security Act, Section 1862(a)(1)(A) states that no payment shall be made for items or services which are not reasonable and necessary for the diagnosis or treatment of illness or injury.

Title XVIII of the Social Security Act, Section 1833(e) states that no payment shall be made to any provider for any claim that lacks the necessary information to process the claim.

If a covered diagnosis is not on the claim, the edit will automatically deny the service as not medically necessary.

Covered Diagnosis Codes

For codes 31720, 94640, 94664, 94760, and 94761

*Use code 276.7 with a diagnosis of hyperkalemia.

** Effective 10/01/2011

*** Effective 10/01/2011 - code 516.3 will be removed

****Use code 518.89 for patients who have become oxygen dependent following an illness.