Non acupuncture based add on codes – issue of fact

Fee Schedule Denials and Evidentiary Requirements for Non-Acupuncture Add-On Codes

New York’s no-fault insurance system relies heavily on workers’ compensation fee schedules to establish reasonable and necessary charges for medical services. When insurance carriers deny payment based on fee schedule limitations, the evidentiary burden becomes critical. The question frequently arises: what proof must insurers provide to establish that specific CPT codes were properly denied under fee schedule provisions?

The Appellate Term’s decision in 2 & 9 Acupuncture, P.C. v 21st Century Advantage Insurance Co. addresses this question in the context of non-acupuncture add-on codes CPT 97026 and 97016—codes that acupuncture providers frequently bill alongside acupuncture services. The case highlights a recurring problem: insurers attempting to zero out legitimate charges without providing adequate expert support or properly applying fee schedule ground rules.

This decision builds on prior Appellate Term precedent establishing heightened evidentiary requirements when insurers seek to deny payment for ancillary services that don’t fit neatly within standard fee schedule categories. Understanding these requirements is essential for both providers seeking reimbursement and carriers defending denial of payment claims.

Case Background

Plaintiff 2 & 9 Acupuncture, P.C. provided medical services to an injured patient and billed defendant carrier for those services using multiple CPT codes. Among the services billed were CPT code 97026 (application of a modality to one or more areas; decompression traction) and CPT code 97016 (application of a modality to one or more areas; vasopneumatic devices).

Defendant carrier denied payment for services billed under these two CPT codes, asserting that the charges exceeded amounts permitted under New York’s workers’ compensation fee schedule. Plaintiff brought suit to recover the unpaid portions of the bills. Defendant moved for summary judgment, arguing it had properly denied the charges in accordance with fee schedule limitations.

The Civil Court granted defendant’s motion in part but denied it with respect to the claims for CPT codes 97026 and 97016. Defendant appealed, contending it had made a prima facie showing that these codes were properly denied under the applicable fee schedule provisions.

Jason Tenenbaum’s Analysis:

2 & 9 Acupuncture, P.C. v 21st Century Advantage Ins. Co., 2017 NY Slip Op 50599(U)(App. Term 2d Dept. 2017)

“Upon a review of the record, we find that defendant failed to demonstrate, prima facie, that it had properly denied payment for the unpaid portions of the bills for services billed under CPT codes 97026 and 97016 in accordance with the workers’ compensation fee schedule (see Sama Physical Therapy, P.C. v American Tr. Ins. Co., 53 Misc 3d 129, 2016 NY Slip Op 51359 ; W.H.O. Acupuncture, P.C. v Progressive Preferred Ins. Co., 36 Misc 3d 133, 2012 NY Slip Op 51335 ).

Accordingly, the amended order, insofar as appealed from, is reversed and the branches of defendant’s motion seeking summary judgment dismissing so much of the complaint as sought to recover for services billed under CPT codes 97026 and 97016 are denied.”

It appears that Plaintiff billed for the above two codes and was not compensated for the same. The Court through citing Sama Physical and WHO Acupuncture, P.C. is holding that in order to zero out the non acupuncture based codes, an expert affidavit is necessary (WHO Acupuncture). Alternatively, more probative proof would be necessary should Ground Rule 11 be utilized (Sama),

Legal Significance

This decision reinforces that insurance carriers cannot simply cite to workers’ compensation fee schedules without providing substantive proof that the specific services at issue fall within fee schedule limitations. The Appellate Term’s reliance on both Sama Physical Therapy and W.H.O. Acupuncture establishes two pathways for carriers seeking to deny ancillary code charges, but both require more than bare assertions.

Under the W.H.O. Acupuncture line of cases, when carriers contend that specific CPT codes are not reimbursable or should be reduced under fee schedule provisions, expert affidavits become necessary. The expert must explain why the particular services billed under the challenged codes either exceed fee schedule allowances or fall outside compensable services. This requirement prevents carriers from making conclusory denials without medical or coding expertise to support their position.

The Sama Physical Therapy alternative permits carriers to rely on Workers’ Compensation Ground Rule 11 without expert affidavits, but only when the carrier provides “more probative proof” demonstrating how Ground Rule 11 applies to the specific codes at issue. This probative proof must show a clear connection between the ground rule provision and the denied codes—not just cite the ground rule and assume applicability.

The decision reflects judicial recognition that fee schedule provisions are complex, particularly when acupuncture providers bill for physical therapy modality codes alongside acupuncture treatments. CPT codes 97026 and 97016 represent physical therapy services that may legitimately accompany acupuncture but require careful analysis to determine whether they’re separately reimbursable or included within acupuncture fee schedule amounts.

Practical Implications

For insurance carriers, this decision establishes clear evidentiary requirements before denying ancillary code charges. Carriers cannot simply issue blanket denials citing fee schedule limitations. They must either obtain expert opinions explaining why the codes exceed fee schedule allowances or provide detailed analysis showing how specific ground rules prohibit payment for the services billed.

For medical providers, particularly acupuncture practices that routinely bill physical therapy modality codes, this decision provides ammunition to challenge insufficient denials. When carriers fail to support fee schedule denials with proper expert testimony or ground rule analysis, providers can defeat summary judgment motions and proceed to trial on the merits.

The decision also highlights the importance of documentation in fee schedule disputes. Providers should maintain records showing that ancillary services like decompression traction or vasopneumatic devices were provided separately from acupuncture treatments, supporting arguments for separate reimbursement. Carriers must develop expertise—either in-house or through consultants—to properly evaluate whether ancillary codes represent duplicative billing or legitimate standalone services.

Key Takeaway

Insurance carriers seeking to deny payment for non-acupuncture add-on codes billed by acupuncture providers must provide either expert affidavits explaining why the codes aren’t compensable under fee schedules or detailed proof showing how workers’ compensation ground rules prohibit payment. Mere citation to fee schedule provisions without supporting evidence fails to establish a prima facie case for summary judgment. Providers billing ancillary physical therapy codes alongside acupuncture services can successfully defend against insufficiently supported denials when carriers fail to meet these evidentiary requirements.

Related Articles

• Fee schedule defense requirements and competent evidence standards
• Fee schedule defense requirements in no-fault insurance cases
• Understanding medical billing and down-coding in New York no-fault insurance claims
• NY acupuncture fee schedules and chiropractor rate limitations
• New York No-Fault Insurance Law

Legal Update (February 2026): Since this 2017 post discussing fee schedule denials for CPT codes 97026 and 97016, New York’s workers’ compensation fee schedules and related regulations may have been amended or updated. Practitioners should verify current fee schedule provisions and denial procedures, as reimbursement rates and evidentiary requirements for challenging denials may have changed.