Welcome to The Coding Corner, a space where doctors who are already excellent at doctoring can dig into the finer details of coding, documentation, compliance, and the occasional mystery that is the AMA Evaluation and Management (E/M) grid. Each month, Tonya Reynoldson, OD, brings forward real-world coding questions we commonly hear in eyecare practices, and she and Sarah Haney break them down from both clinical and coding perspectives.
This month, the Coding Corner Crew helps distinguish between screening and medically necessary diagnostic testing.
Tonya: Sarah, this is probably one of the questions I hear the most from doctors:
"If a patient comes in for a screening test and we find something abnormal, can we simply convert that screening into a billable medical test?"
Where does the confusion come from?
Sarah: I think the confusion comes from equating insurance coverage with medical necessity. They're related, but they're not the same thing.
Providers know that certain diagnoses may support coverage for diagnostic testing, so it's easy to think, "Well, we found pathology, so now the test is medically necessary."
But that's looking backward.
Medical necessity is determined before a diagnostic test is performed, not after. A screening service and a provider-ordered diagnostic test are 2 distinctly different services with 2 different purposes. One cannot become the other simply because the results happened to reveal certain findings.
Tonya: Let's start with the basics. What defines a screening test vs a diagnostic test?
Sarah: The intent of the test is what matters.
A screening test is performed on patients without a documented clinical indication. It's offered to look for disease that isn't otherwise suspected. Think of it as casting a wide net.
A diagnostic test, on the other hand, is ordered by the provider because something observed during the examination suggests additional information is needed to evaluate, diagnose, treat, or manage a patient's condition.
That's why standing orders for diagnostic testing aren't appropriate in the physician office setting. If every patient automatically receives an OCT or fundus photograph before the provider has even evaluated them, there has been no opportunity for the provider to determine whether the test is medically necessary.
Remember: Provider-ordered testing follows clinical judgment, not office protocol.
Tonya: Many doctors think that because they discovered pathology during a screening, the screening suddenly becomes medically necessary. Why isn't that how coding works?
Sarah: Because medical necessity isn't determined by what the test found; it's determined by why the test was ordered.
CMS has long stated that diagnostic tests are reasonable and necessary when they are ordered to evaluate a specific clinical indication and the results will be used to manage the patient's care. In other words, the provider must have clinical reasoning that supports the need for the test before it's performed.
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Finding pathology after a screening doesn't rewrite history.
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A screening that unexpectedly finds disease is still a screening.
Tonya: Can you explain why payors don't allow us to use the findings of a test to justify ordering that same test?
Sarah: Imagine if that were allowed. Every screening that found an abnormality could suddenly be billed to insurance after the fact. There would be no meaningful distinction between screening and diagnostic testing.
That's why payors expect the clinical indication to exist before the test is performed.
Otherwise, you're essentially searching for a diagnosis that will justify payment after the service has already been completed. Compliance professionals often refer to this as "fishing" for coverage, and that's exactly what payors are trying to prevent.
The medical record should tell the story in chronological order:
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The provider evaluates the patient.
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Clinical findings create a question that needs to be answered.
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The provider orders the appropriate diagnostic test.
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The results influence diagnosis or management.
Not the other way around.
Tonya: What documentation should already exist in the chart before ordering a billable diagnostic test?
Sarah: Before ordering a diagnostic test, the record should clearly document:
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the patient's symptoms, complaints, or abnormal clinical findings;
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the provider's clinical reasoning for ordering the test;
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an order for the diagnostic study; and
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how the results will help evaluate, diagnose, treat, or manage the patient's condition.
Diagnostic tests are ordered because the results are expected to influence medical decision-making, not to document normal anatomy or to be used as a confirmation of findings.
Tonya: Are there situations where a screening test leads to additional billable testing during the same visit? If so, how should that be documented?
Sarah: Maybe, but it depends on the clinical scenario and what additional testing you may be referring to.
Let's say a retinal wellness screening identifies an abnormal finding and the provider chooses to perform an additional diagnostic test.
The provider should be prepared to explain how the diagnostic test added value beyond what was already seen during the screening and the examination. If both images show the same information, an auditor may reasonably ask why 2 separate tests were necessary.
Diagnostic testing should answer a clinical question or provide information that influences patient management, not simply duplicate another image.
Tonya: What are some of the biggest audit risks you see related to screening technology?
Sarah: The biggest one, by far, is trying to convert a screening into a billable diagnostic test after pathology is discovered. If there wasn't a documented clinical indication before the test was performed, it doesn't become medically necessary because it happened to show abnormalities.
Remember: A screening is a screening is a screening.
The second risk is relying on standing orders. Every diagnostic test should be ordered because the provider determined that patient needed it, not because every patient type receives the same testing protocol.
Bottom line: Medical necessity starts with the provider's clinical judgment, rather than the test results.
Until next time, keep screening for disease...not for payor coverage.OM
— Your Coding Corner Crew, Sarah & Tonya
Resources
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American Medical Association. Definitions of "screening" and "medical necessity" H-320.953. AMA PolicyFinder. 2023. Accessed July 14, 2026. https://policysearch.ama-assn.org/policyfinder/detail/H-320.953?uri=%2FAMADoc%2FHOD.xml-0-2625.xml
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Centers for Medicare & Medicaid Services. Billing and coding: ophthalmology: posterior segment imaging (extended ophthalmoscopy and fundus photography) (A56726). CMS Medicare Coverage Database. August 1, 2019. Revised October 1, 2025. Accessed July 14, 2026. https://www.cms.gov/medicare-coverage-database/view/article.aspx?articleid=56726&ver=42
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Centers for Medicare & Medicaid Services. Local coverage determination (LCD): ophthalmology: posterior segment imaging (extended ophthalmoscopy and fundus photography) (L33567). CMS Medicare Coverage Database. October 1, 2015. Revised October 1, 2019. Accessed July 14, 2026. https://www.cms.gov/medicare-coverage-database/view/lcd.aspx?lcdId=33567&ver=27
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Noridian Healthcare Solutions. Screening services. Accessed July 14, 2026. https://med.noridianmedicare.com/web/jeb/specialties/lab/screening-services
