Keloid Excision and Scar Revision
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NC Medicaid policy governing coverage and requirements for keloid excision and scar revision procedures for enrolled beneficiaries; defines medical necessity, eligibility, and EPSDT considerations.
Removed the word 'significant' from subsection 3.2.1.a and moved list for readability; replaced 'and/or' with 'or'.
Updated subsection 4.2.1.a and b to remove a non-inclusive list and removed a note regarding 'significant physical functional impairment…'.
Inserted Note: Prior approval for keloid excisions and scar revisions must include one of the specified diagnosis codes in the table below as the primary diagnosis. Claims submitted without these required diagnosis codes will be denied by Medicaid.
Removed L11.1, L55.9 and L56.0 from the ICD-10 code table to align with edits in NCTracks.
Identified six CPT codes on this list as an add-on code by including + before the CPT code.
Coverage Criteria for Keloid Excision and Scar Revision
Specific Criteria Covered
Medicaid shall cover Keloid Excision and Scar Revisions when medically necessary and the general coverage criteria are met and when ONE of the enumerated conditions is present.
General Medicaid coverage criteria (Subsection 3.1)
At least one of these conditions must be present
These additional requirements apply in conjunction with any one of the specific indications above.
Specific Criteria Covered
Covered when ALL of the following are met:
From Subsection 3.1
At least one of these must be present (Subsection 3.2.1 a–b)
All of these apply when considering medical necessity (Subsection 3.2.1 c–d)
Scars, including keloid and hypertrophic scars, typically do not require intervention unless they produce a measurable loss of function. In this policy context, treatment is generally not indicated for scars that do not cause a functional impairment (for example, interference with communication, respiration, eating, swallowing, or vision); such asymptomatic or purely cosmetic scars are usually managed conservatively or not treated.
Exclusion: Procedures performed for cosmetic reasons only are not covered.
Operational note: L11.1, L55.9, and L56.0 have been removed from the policy's ICD-10 code table and are no longer accepted for prior approval or claim submission for these services.
Standard medical necessity limits apply: services must be individualized, consistent with the beneficiary’s symptoms or a confirmed diagnosis, not in excess of the beneficiary’s needs, and able to be safely furnished. Services that are not individualized, are inconsistent with the diagnosis, are excessive for the beneficiary’s needs, or when an equally effective, more conservative, or less costly treatment is available statewide are not considered medically necessary.
Additional exclusions: the procedure is not covered when the beneficiary does not meet the eligibility or coverage criteria in Sections 2.0 and 3.0, when the service duplicates another provider’s procedure or service, or when the procedure is experimental or investigational. Procedures that are cosmetic-only are excluded as noted above.
This block is included for completeness and cross-reference to the full policy. Refer to the policy text for all coverage criteria, exclusions, and administrative requirements, including prior approval, documentation, and coding updates effective as of the amended date.
Coding: CPT, ICD-10-CM, and Procedure Codes
| unspecified | Attachments and CPT/ICD-10 code lists referenced in attachments; specific codes not contained in this excerpt |
| L90.5 | Exact code listed in policy |
| L91.0 | Exact code listed in policy |
| 0HN0XZZ | ICD-10-PCS code listed in policy |
| 0HN1XZZ | ICD-10-PCS code listed in policy |
| 0HN4XZZ | ICD-10-PCS code listed in policy |
| 0HN5XZZ | ICD-10-PCS code listed in policy |
| 0HN6XZZ | ICD-10-PCS code listed in policy |
| 0HN7XZZ | ICD-10-PCS code listed in policy |
| 0HN8XZZ | ICD-10-PCS code listed in policy |
| 0HN9XZZ | ICD-10-PCS code listed in policy |
| 0HNAXZZ | ICD-10-PCS code listed in policy |
| 0HNBXZZ | ICD-10-PCS code listed in policy |
| 11400 | CPT listed in mapping table |
| 11401 | CPT listed in mapping table |
| 11402 | CPT listed in mapping table |
| 11403 | CPT listed in mapping table |
| 11404 | CPT listed in mapping table |
| 11406 | CPT listed in mapping table |
| 11420 | CPT listed in mapping table |
| 11421 | CPT listed in mapping table |
| 11422 | CPT listed in mapping table |
| 11423 | CPT listed in mapping table |
Provider Actions, Prior Authorization and Documentation
Prior approval remains required for beneficiaries <21 (EPSDT)
If prior approval is required for the requested service, that requirement still applies for beneficiaries under age 21; providers must follow NCTracks procedures and EPSDT guidance when submitting requests.
Obtain DHHS Utilization Review Contractor prior approval
Obtain prior approval from the Department of Health and Human Services (DHHS) Utilization Review Contractor before performing keloid excision or scar revision; do not proceed without an approved authorization.
Include required primary diagnosis on prior approval
Ensure the prior approval request lists one of the policy-specified ICD-10 diagnosis codes (e.g., L90.5 or L91.0) as the primary diagnosis; inclusion of a required primary diagnosis code is an operational requirement for approval and claims.
- Prior approval must include one of the specified diagnosis codes as the primary diagnosis.
Document attempt and failure of conservative treatments
Document that conservative treatments (for example, steroid injection or pressure application) were attempted and did not produce a favorable response before establishing medical necessity for excision or revision when relevant.
- Conservative measures such as steroid injection or pressure application should be tried and documented when relevant.
Document prior conservative treatments and outcomes
Include specific documentation of the conservative treatments tried and the lack of favorable response when submitting prior approval or medical records supporting medical necessity.
- Document the type of conservative treatment (e.g., steroid injection, pressure application), dates, and clinical response.
- Attach related treatment records to the prior approval request.
Complete all additional procedural and submission actions
Follow all other provider actions required by the policy when preparing the prior approval and claims submission, including photographic, coding, and record-submission requirements described in Attachment A and Section 5.2.
- Comply with NCTracks Provider Claims and Billing Assistance Guide and Attachment A billing rules.
- Submit the full prior approval packet and supporting records per Section 5.2.
Document medical necessity and functional impairment
Provide documentation that establishes medical necessity: that the scar/keloid causes functional impairment or meets the specific covered indications, and that prior treatments were attempted as required.
- Demonstrate impairment (communication, respiration, eating, swallowing, vision) or obstruction/ bodily distortion limiting ADLs, expected improvement with procedure, or evidence of pain, infection, drainage, or rapid increase in size.
- Show lack of favorable response to documented conservative treatment when relevant.
Submit labeled preoperative photographs with identifiers
For prior approval, submit clear preoperative photographs of the keloid(s)/scar(s) that include beneficiary first and last name, beneficiary identification number, provider name and NPI, and the date the photograph was taken.
- Include photographs showing location and size of the lesion(s).
- Ensure images are clearly labeled with required beneficiary and provider identifiers.
Submit prior approval request plus all supporting records
Submit the complete prior approval request along with all relevant health records and any other documentation that supports the beneficiary has met the policy criteria in Subsection 3.2.
- Include medical records showing prior treatments, responses, functional impact, and any prior related surgery.
Use highest-level ICD-10 specificity and include required primary code
Report ICD-10-CM and PCS codes to the highest level of specificity using the current ICD-10 edition; prior approval must include one of the specified diagnosis codes as the primary diagnosis and claims lacking those primary codes will be denied.
- Use most specific ICD-10-CM/PCS codes that support medical necessity.
- Verify code list updates (policy removed certain codes) and use current NCTracks-accepted codes.
Denial risk: insufficient medical necessity or conservative-treatment evidence
Services that are not individualized, inconsistent with the diagnosis, unsafe, or not the most conservative/effective statewide option may be denied; insufficient documentation of medical necessity or prior conservative treatment increases denial risk.
- Lack of documentation showing functional impairment, expected improvement, or failed conservative therapy risks denial.
Denial triggers: eligibility, duplication, experimental/cosmetic services
Claims or prior approvals may be denied if the beneficiary does not meet eligibility or coverage criteria, the service duplicates another provider's service, or the service is experimental, investigational, or cosmetic-only.
- Confirm beneficiary eligibility in Section 2.0 and that the indication meets the specific coverage criteria in Section 3.0.
- Do not submit for services intended solely for cosmetic reasons.
Claims will be denied if required primary diagnosis code is missing
Claims submitted without one of the policy-specified diagnosis codes listed as the primary diagnosis (for example, L90.5 or L91.0) will be denied by Medicaid; ensure the primary diagnosis on claims matches the required codes used for prior approval.
- Verify that the claim's primary ICD-10-CM code is one of the policy-specified codes before submission.
Definitions and Background
Keloid and hypertrophic scars are abnormal dermal responses after skin injury. Keloid scars develop when collagen production continues after wound healing, often extending beyond the original wound margins, sometimes appearing darker than surrounding skin, and with a tendency to recur or enlarge after removal. Hypertrophic scars remain within the boundaries of the original wound or incision and frequently improve over time, though improvement may be incomplete.
Treatment is not required for these scars unless they cause a functional impairment—such as limiting communication, respiration, eating, swallowing, or vision—or cause obstruction, bodily distortion that limits activities of daily living, persistent pain, infection, drainage, or rapid increase in size. When treatment is considered for functional reasons, documentation should demonstrate the impairment and prior conservative measures (for example, steroid injection or pressure therapy) and their lack of favorable response.
Revision History and Policy Changes
Policy amended to clarify coverage language: removed the word 'significant' from subsection 3.2.1.a, replaced 'and/or' with 'or', and moved list for readability; updated subsection 4.2.1.a and b to remove a non-inclusive list and removed a related note about 'significant physical functional impairment'.
Inserted an operational prior-approval requirement specifying that prior approval must include one of the specified diagnosis codes as the primary diagnosis and that claims without these codes will be denied; updated Attachment A (Letter B) for billing requirements.
Removed ICD-10 codes L11.1, L55.9 and L56.0 from the ICD-10 code table to align with NCTracks edits and updated table titles to include 'Primary' diagnosis and align procedure naming.
Updated policy template language due to North Carolina Health Choice Program's move to Medicaid; policy posted 06/01/2023 with an effective date of 04/01/2023.
Fixed a minor formatting issue; posting and amended date were not changed.
Identified six CPT codes on the attachments list as add-on codes by adding a '+' prefix in the attachments table (letter C).
Updated policy template language and Attachment A Table of Contents; clarified billing instructions to comply with National Uniform Billing Guidelines.
Updated policy template language and general policy wording across sections as part of a template refresh.
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