CPT Code 970309

Understanding CPT Code 97039 and the “Out of Scope” Defense

In New York’s no-fault insurance system, healthcare providers frequently battle with insurers over coverage of specific medical treatments. One common defense strategy employed by insurance companies is the “out of scope” argument, claiming that certain procedures fall outside a provider’s licensed specialty and therefore aren’t reimbursable under the no-fault fee schedule.

CPT code 97039 represents “unlisted modality,” a catch-all billing code used for therapeutic procedures that don’t fit into standard categories. This code often becomes a point of contention, particularly when acupuncturists and other alternative medicine providers seek reimbursement for treatments that insurers argue exceed their scope of practice.

The case of Acupuncture Approach, P.C. v Tri State Consumer Ins. Co. demonstrates how courts evaluate these disputes, especially when insurers fail to meet their burden of proof in summary judgment motions. Similar fee schedule disputes arise with other acupuncture-related codes, highlighting the ongoing tension between traditional medical billing practices and alternative therapies.

Jason Tenenbaum’s Analysis:

Acupuncture Approach, P.C. v Tri State Consumer Ins. Co., 2017 NY Slip Op 51170(U)(App. Term 1st Dept. 2017)

The long-failed out of scope defense, well has long-failed. Again, it failed. Common theme?

“Triable issues of fact are raised as to whether defendant-insurer properly denied plaintiff’s no-fault claim billed under CPT code 97039, thus precluding summary judgment dismissing this claim. Defendant’s submissions failed to establish prima facie its contention that the service is not reimbursable because it is a “physical medicine modality” and “outside the provider’s specialty”

Key Takeaway

This decision reinforces that insurers cannot simply assert that a treatment falls outside a provider’s scope without substantial proof. When insurers fail to establish their defense with concrete evidence, courts will allow the case to proceed to trial, giving healthcare providers the opportunity to demonstrate that their services were properly rendered within their licensed scope of practice.

Legal Update (February 2026): Since this post’s publication in 2017, New York’s no-fault fee schedules and reimbursement rates have undergone multiple regulatory updates and amendments. Additionally, recent statutory changes and case law developments may have affected the application of CPT code 97039 and “out of scope” defenses in no-fault insurance disputes. Practitioners should verify current fee schedule provisions and recent appellate decisions when evaluating reimbursement claims for unlisted modality codes.