Medical Coding and Billing Guidelines For Health Services – Why Unbundling is a Bad Idea


When coding and subsequently billing Medicare or a commercial carrier for services rendered to one of your patients, there are certain guidelines that must be followed by you, the provider. One of these guidelines is not to break down a procedure into its component parts. This is better known as unbundling.

Medicare is the primary insurance company that we deal with and the billing guidelines that will be discussed primarily are in reference to Medicare. Remember that the private insurance carriers very often follow what Medical doctor Medicare does very closely.

The classic example that is utilized to demonstrate how not to unbundle is the hammertoe procedure, 28285.

A hammertoe correction includes, for the most part, those collective procedures that often may constitute a single procedure. Medicare considers billing for individual portions of the entire correction as unbundling and will not pay as such.

Consider the following as all included in a hammertoe correction:


  1. An excision of a portion of bone, with or without fusion or fixation of the digit, with a K-wire or pin.
  2. All skin and soft tissue correction, repair, incision, or excision at the interphalangeal or metatarsal phalangeal joint.
  3. Multiple exostectomies performed at the same time on the same toe are considered to be incidental and included in the 28285 surgical fee.
  4. A matrix correction (11750) done in addition to the hammertoe correction is usually payable at 50% of the primary procedure code, 28285.
  5. Code 14040 is usually not considered appropriate for derotation of the 5th toe. Most carriers will pay this procedure as 28285 or 28286.
  6. Insertion of an interphalangeal implant of toes 2-5 is considered included in the 28285 reimbursement.


Just because you were paid does not mean that you coded correctly. All audits are post-payment with very few exceptions.


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