Executive Summary for Practice Managers
Short on time? Here are the 5 critical takeaways to protect your revenue in 2025:
In the high-volume environment of modern healthcare, the humble skin tag (acrochordon) presents a dangerous paradox. Clinically, it is one of the simplest procedures a provider can perform—often taking less than 60 seconds. However, administratively, it is one of the most complex billing scenarios to navigate successfully.
Why? Because the line between “healthcare” and “vanity” is thinner than ever.
In 2024, dermatology and primary care practices saw a 126% surge in coding-related denials for benign lesion removals. Major payers like UnitedHealthcare, Aetna, and BCBS have tightened their algorithms to automatically flag CPT 11200 as “Cosmetic” unless specific, granular criteria are met in the claim data.
For a busy clinic removing 20 skin tags a week, a denial rate of 15% (triple the industry standard) translates to thousands of dollars in lost annual revenue—not to mention the administrative cost of $25–$40 per claim to rework those denials. At A2Z Billings, we believe you should be paid for every medically necessary procedure you perform. This guide is your blueprint to stopping that leakage.
Before diving into complex scenarios, we must establish the foundational coding hierarchy. Accuracy here is non-negotiable.
There is effectively one primary code for a standard skin tag:
This code encompasses acrochordons, fibroepithelial polyps, and soft fibromas. However, simply slapping L91.8 on a claim is no longer enough. The ICD-10 code tells the payer what the lesion is, but your documentation must tell them why it was removed.
Unlike other destruction codes which are based on lesion size or method, skin tag removal is billed purely by quantity. The method of removal (scissoring, electrosurgery, cryotherapy, or ligation) does not change the code.
| Code | Description | Billing Rules |
|---|---|---|
| 11200 | Removal of skin tags, multiple fibrocutaneous tags, any area; up to and including 15 lesions. | Base Code: Bill this once per session. Whether you remove 1 tag or 15 tags, the reimbursement is the same. |
| 11201 | Each additional 10 lesions (or part thereof). | Add-on Code: Never bill this alone. It must be listed below 11200. Example: Removing 25 tags = 11200 (x1) + 11201 (x1). |
A common error we see during A2Z Billings audits is providers using CPT 17110 (Destruction of benign lesions) for skin tags. Do not do this. CPT 17110 is for warts, seborrheic keratoses, and molluscum. Using it for tags (acrochordons) is considered miscoding and can trigger a RAC (Recovery Audit Contractor) audit.
While L91.8 is the universal soldier of skin tag coding, anatomy matters. Using the general code for highly specific areas can lead to denials, especially when functional impairment is the justification for removal.
Tags on the eyelid are rarely considered cosmetic by savvy billers because they often interfere with vision or blinking. However, you must code for the functional deficit.
This area is fraught with confusion between dermatological tags and hemorrhoidal sequelae.
Lesions here are frequently symptomatic due to friction from undergarments.
In 2025, your clinical notes are being read by AI bots, not humans. These bots are programmed to scan for specific keywords that validate medical necessity. If your note says “Patient wants tag removed,” you will be denied. If your note uses the “Magic Words,” you pass the filter.
To bill insurance, the record must document at least one of the following symptoms:
Keyword: “Hemorrhage” or “Spontaneous Bleeding.”
Example: “Tag on neck catches on necklace, causing recurrent bleeding.”
Keyword: “Purulent,” “Erythematous,” or “Inflamed.”
Example: “Lesion is erythematous and tender to palpation; signs of local infection.”
Keyword: “Painful friction” or “Raw.”
Example: “Patient reports sharp pain when bra strap rubs against the lesion.”
Keyword: “Obscures vision” or “Restricts shaving.”
Example: “Pre-auricular tag restricts ability to shave, leading to ingrown hairs.”
Train your scribes to avoid these phrases in the History of Present Illness (HPI) for billed procedures:
Even with perfect coding, denials happen. The most common denial codes you will see are:
Don’t just resubmit the claim. You must send a “Request for Redetermination” with the medical records attached. Highlight the “Magic Words” in the notes (literally, use a highlighter tool in your PDF editor).
Use this structure for your appeal letter to save time:
RE: Appeal for Claim # [ClaimID] – Medical Necessity Denial
Dear Claims Review Department,
I am writing to appeal the denial of CPT 11200 for patient [Name] on [Date]. The claim was denied as “Cosmetic,” which is incorrect based on the clinical findings.
The patient presented with [Number] acrochordons (L91.8) located in the [Anatomical Area]. Removal was medically necessary due to:
These lesions were not asymptomatic cosmetic concerns. They represented a functional impairment and a source of infection risk. Please review the attached chart notes which clearly document these symptoms.
We request payment in accordance with the patient’s benefit plan for medically necessary benign lesion removal.
Sincerely,
[Provider Name]
Sometimes, a skin tag really is just cosmetic. In these cases, your RCM strategy shifts from “Insurance Billing” to “Patient Collections.”
For Medicare patients, if you believe the service might be denied as not medically necessary, you must have them sign an ABN (Form CMS-R-131) before the procedure. If you don’t, and Medicare denies it, you cannot bill the patient. You eat the cost.
For commercial plans (UHC, Aetna), use a “Notice of Financial Responsibility.” It serves the same purpose: “Your insurance may consider this cosmetic. If they deny payment, you agree to pay $XXX.”
Empower your front desk with this script to handle patient pushback:
“Mr. Smith, insurance rules are very strict about skin tags. Unless the tag is actively bleeding, infected, or painful, they classify it as cosmetic, like Botox. Since your tags aren’t showing those symptoms today, we can absolutely remove them for you, but it would be an out-of-pocket expense of $150. Would you like to proceed?“
A surprising number of denials originate from EMR default settings. Many dermatology-specific EMRs (like EMA or ModMed) have “smart coding” features.
Managing the coding nuances of skin tags, lesions, and minor procedures requires precision that overworked office staff often lack. A 15% denial rate is not “the cost of doing business”—it’s a warning sign.
A2Z Billings specializes in granular, high-volume claims management. We don’t just submit claims; we audit your documentation, train your providers on “magic words,” and fight every denial with data-driven appeals.
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Only if the visit is “separately identifiable.” If the patient came in only for skin tags, you cannot bill an E/M (99213). However, if the patient came in for acne treatment, and you also noticed a skin tag and removed it, you can bill both. You must append Modifier -25 to the E/M code to tell the payer the visit was distinct from the procedure.
There is no specific combo code. You use the primary code L91.8. To capture the inflammation, your clinical notes must explicitly state “Inflamed,” and you may consider secondary codes like L08.9 (Local infection of the skin) if there is purulence or significant cellulitis requiring antibiotics.
CPT 11200 covers the removal of anywhere from 1 to 15 tags. It is a flat-fee code. You do not bill it multiple times for the first 15 tags. If you remove 16 tags, you bill 11200 (x1) and 11201 (x1).
Yes, but strictly based on medical necessity. Medicare will deny claims that lack documentation of bleeding, infection, or functional impairment. Routine removal for comfort or appearance is statutorily non-covered.
Disclaimer: The coding information provided in this article is based on 2024-2025 ICD-10-CM and CPT guidelines. Payer policies vary by region and plan type. Always verify coverage with specific insurance carriers before submitting claims. A2Z Billings is not responsible for claim denials resulting from the use of this guide.
