What is Modifier XE in Medical Billing?

Performed multiple unrelated services on the same day, but don’t know how to bill them? Many billers will guide you to use modifier 59. But guess what, most likely your claims will get denied. Why? Because the Centers for Medicare and Medicaid Services (CMS) now requires modifiers that explain the circumstances more precisely than 59.

One such modifier is XE. That’s what this blog is all about. We have created this guide to help you understand what modifier XE is, when you should use it, and some guidelines that will significantly improve your claims acceptance rate. 

So, let’s start.  

Modifier XE – Description

So, what exactly is modifier XE?

Well, XE officially stands for “Separate Encounter.” It is used to indicate that a service is distinct because it occurred during a separate encounter.

That’s the textbook definition, but here’s what it really means.

XE is part of the X{EPSU} modifier family. It is a group of four modifiers: XE, XS, XP, and XU. These modifiers were introduced by CMS in 2015. Why? Because providers were overusing and misusing modifier 59, the original “distinct procedural service” modifier. Payers got tired of the ambiguity and started automatically denying claims, forcing providers to initiate costly appeal processes.

Like the modifier XE, the other modifiers in this family give you greater specificity. Instead of the catch-all modifier 59, you now have targeted options that tell the complete story. Modifier XE specifically applies when you’re dealing with procedures performed on the same calendar day but during genuinely separate patient encounters.

So, whenever you are filing claims for a situation in which multiple distinct services are performed on the same day but in separate encounters, use XE instead of modifier 59. You should only use modifier 59 if no other more specific modifier is appropriate.

Appropriate Use Cases for Modifier XE

The description might not be enough to clarify the confusion. So, let’s walk through some real-world scenarios in which modifier XE can be used:

Scheduled Procedure with Unplanned Return

Suppose a patient had a diagnostic colonoscopy (CPT code 45378, global surgery period 0 days) at an outpatient center at 8 AM. The procedure was successful and was concluded with all the requirements. After the procedure, the patient was discharged by 10 AM. At 3 PM, the same patient returned to the facility after an accident that resulted in a wound on his arm. The physician performed a simple wound repair (CPT code 12001) to treat the superficial wound.

This scenario warrants modifier XE on the wound repair code. Why? The patient was discharged and returned later. That’s a separate encounter, not a continuation of the morning procedure.

Surgical Procedure Followed by Separate Complication Management

Here is another scenario.

Suppose a patient was suffering from chronic knee pain. The physician performed an arthroscopic knee surgery (CPT code 29881, global surgery period 90 days) in the morning. The surgery was successful, and the patient was discharged by noon with standard postoperative instructions.

However, later that evening, the patient fell down the stairs and had an acute injury that resulted in a laceration on the forearm that required surgical repair. So, the patient returned to the hospital’s emergency department, where the same surgeon evaluated and performed the simple laceration repair (CPT code 12002) in a separate operative session.

Since this second procedure addresses a distinct service that is separate from the knee surgery and is performed during a separate encounter later the same day, the billing team uses modifier XE with the wound repair code.

Accurate Usage Guidelines for Modifier XE

Now that you know when to use modifier XE, let’s talk about how to use it correctly. Small mistakes can lead to denials. So, the following are some important guidelines to keep in mind. 

Understand When Not To Use Modifier XE

Most billers know when to use modifier XE. However, only a few of them know when not to use it. CMS explicitly states that modifier XE should not be appended to Evaluation and Management (E/M) service codes. 

For a significant, separately identifiable E/M service performed on the same day as a procedure, you would use modifier 25, not XE.

Here is a rule of thumb that will help you a lot in the long run. 

“A separate encounter means the patient left the facility or there was a clear break in care continuity.”

Meet the Documentation Requirements

Modifier XE is only as good as the documentation supporting it. Without proper documentation, your claims will definitely be rejected by insurance payers. For proper reimbursement, you should ensure the following:

• Time Stamps: Document the start and end time of each encounter.
• Distinct Clinical Purposes: Show why each encounter occurred. E.g., different complaints, different diagnoses, or different clinical needs.
• Discharge and Readmission: Note when the patient left the facility and returned.
• Services Provided: Detail what was done during each separate encounter.
• Gap in Care: Demonstrate a clear break in continuity, not just a brief pause.

If you want to avoid denials, don’t write vague comments like “patient seen twice today” in your records. You must write everything with specificity. 

Ensure Proper Modifier Order

This is an important point, so make notes of it. Modifier sequencing in your claims matters. 

Pricing modifiers like 26 (Professional Component) and TC (Technical Component) always come first. Other modifiers, including XE, follow. So if you’re billing the professional component of a service performed during a separate encounter, the correct order is: CPT-26-XE, not CPT-XE-26.

The following is the correct sequence of using modifiers in your claims:

1. Pricing Modifiers (TC, 26, and others)
2. Payment Modifiers (22, 26, 50, 51, 52, 53, and more)
3. Location/Informational Modifiers (LT, RT, FA, F1, XE, XU, etc.)

Final Thoughts

That’s it, we have reached the end of this guide. Here’s what you must remember: 

Modifier XE is not complicated. It just requires more attention to details. Only use this modifier when you have genuinely separate patient encounters on the same day. Follow the guidelines we have provided in this guide, and you will significantly reduce your denial rates. 

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