Introduction

Modifier 54 (Surgical Care Only) is used when one physician performs only the surgical procedure, while another physician provides the preoperative and/or postoperative management. It communicates to the payer that the billing provider is responsible only for the intraoperative (surgical) portion of care and should be reimbursed only for that portion of the global surgical package.

Modifier 54 is commonly used when patients are referred to surgeons who perform the operation but transfer postoperative care to another physician closer to the patient’s home or to the referring provider. It is also frequently seen in orthopedic surgery, trauma surgery, neurosurgery, cardiovascular surgery, and other specialties where care is shared among multiple physicians.

Understanding Modifier 54 is essential because it directly affects reimbursement under Medicare’s Global Surgical Package and many commercial payer policies.

Modifier Number

Modifier Name

Surgical Care Only

Note: The official CPT® descriptor is maintained by the American Medical Association (AMA). Always refer to the latest licensed CPT® codebook for the official wording.

Plain English Explanation

Modifier 54 tells the insurance company:

“I performed only the surgery. Another physician is responsible for some or all of the preoperative and/or postoperative care.”

The surgeon is requesting payment only for the surgical portion of the global service.

Purpose of Modifier 54

Modifier 54 is used to:

Report surgical services only.
Identify split global surgical care.
Prevent billing for postoperative services not provided.
Ensure accurate reimbursement when multiple physicians share patient care.
Comply with Medicare global surgery guidelines.

Understanding the Global Surgical Package

Many surgical CPT® codes include a global surgical package, which generally consists of:

Preoperative evaluation related to the surgery.
The surgical procedure itself.
Routine postoperative care during the global period.

When all services are provided by one physician, the surgical CPT® code is billed without Modifier 54.

When care is shared between physicians, Modifiers 54, 55, and 56 may be used to divide responsibility.

Modifier	Responsibility
54	Surgical Care Only
55	Postoperative Management Only
56	Preoperative Management Only

When to Use Modifier 54

Modifier 54 is appropriate when:

One physician performs only the surgery.
Another physician assumes postoperative care.
The transfer of care is documented.
The payer recognizes split global surgical care.
The surgery has a global period.

Common Examples

✔ Orthopedic surgeon performs hip replacement; hometown physician manages postoperative care.

✔ Trauma surgeon performs emergency fracture repair; local orthopedic physician provides follow-up visits.

✔ Neurosurgeon performs surgery; referring neurologist manages postoperative recovery.

✔ Cardiovascular surgeon performs bypass surgery; cardiologist manages postoperative care when appropriate.

When NOT to Use Modifier 54

Do not use Modifier 54 when:

The surgeon provides the complete global surgical package.
No transfer of postoperative care occurs.
The surgery has no applicable global period.
Documentation does not support shared care.
Payer policy does not recognize split global billing.

Medicare Rules

Medicare allows split global surgical billing under specific circumstances.

Important Medicare considerations include:

Modifier 54 is appended to the surgical CPT® code.
Documentation must support the transfer of care.
Both physicians should document the transfer date when applicable.
Medicare reimburses only the surgical portion of the global package.
The physician providing postoperative care generally reports Modifier 55.

Always review current CMS guidance and Medicare Administrative Contractor (MAC) billing instructions.

Commercial Insurance Rules

Commercial payer policies differ.

Some insurers:

Recognize Modifiers 54, 55, and 56.
Require transfer-of-care documentation.
Require notification from both physicians.
May have different reimbursement percentages.
May not allow split global billing for all procedures.

Always verify payer-specific policies before claim submission.

Documentation Requirements

Documentation should include:

Operative report.
Date of surgery.
Name of physician assuming postoperative care.
Transfer-of-care documentation.
Medical necessity.
Communication between providers (when applicable).
Patient consent, if required by payer policy.

Proper documentation is essential to avoid denials.

Real Billing Examples

Example 1 – Orthopedic Surgery

A patient travels to a specialty orthopedic center for a total hip replacement.

The orthopedic surgeon performs the surgery but transfers all postoperative visits to the patient’s hometown orthopedic physician.

The operating surgeon reports:

27130-54

The hometown physician later reports postoperative management using Modifier 55.

Example 2 – Trauma Surgery

A trauma surgeon repairs an open tibial fracture.

After discharge, postoperative care is transferred to a local orthopedic specialist.

The trauma surgeon appropriately reports the surgical CPT® code with Modifier 54.

Example 3 – Incorrect Use

A general surgeon performs a laparoscopic cholecystectomy and personally provides every postoperative visit during the global period.

Modifier 54 should not be reported because the surgeon provided the complete global surgical package.

CMS-1500 Claim Example

Field	Example
CPT Code	Surgical CPT® code
Modifier	54
Diagnosis Pointer	Appropriate ICD-10-CM diagnosis
Units	1
Charges	Provider’s billed amount

Common Denial Reasons

No documentation supporting transfer of care.
Surgeon actually provided postoperative management.
Modifier 54 billed on a procedure without a global period.
Missing operative report.
Payer does not recognize split global billing.
Incorrect modifier sequencing.

How to Correct the Denial

Review the EOB or ERA.
Verify that postoperative care was transferred.
Confirm the transfer date.
Submit the operative report.
Provide transfer-of-care documentation if requested.
Appeal with supporting documentation when appropriate.

Coding Tips

Append Modifier 54 only to the surgical CPT® code.
Ensure another physician actually provides postoperative care.
Maintain written documentation of the transfer.
Verify payer recognition of split global billing.
Review the procedure’s global period before billing.

Modifier 54 vs Modifier 55 vs Modifier 56

Modifier	Description
54	Surgical Care Only
55	Postoperative Management Only
56	Preoperative Management Only

These three modifiers work together when global surgical care is divided among different physicians.

Frequently Asked Questions (FAQs)

Q1. Can Modifier 54 be used if the surgeon also performs all postoperative care?

Answer: No. Modifier 54 is only appropriate when postoperative care is provided by another physician.

Q2. Does Modifier 54 reduce reimbursement?

Answer: Yes. Because the surgeon is billing only for the surgical portion of the global package, reimbursement is generally less than payment for the complete global service. The exact percentage depends on CMS or payer policies.

Q3. Is transfer-of-care documentation required?

Answer: Yes. Documentation supporting the transfer of care is critical for accurate reimbursement and audit compliance.

Q4. Can commercial insurance policies differ from Medicare?

Answer: Yes. Commercial insurers may have different requirements for recognizing split global surgical care.

AR Caller Tips

When following up on a denied Modifier 54 claim:

Confirm the payer accepts split global surgical billing.
Verify the date postoperative care was transferred.
Check whether Modifier 55 was billed by another provider.
Submit transfer-of-care documentation if requested.
Record the representative’s name, reference number, and follow-up instructions.

Interview Questions

Question 1

What is Modifier 54 used for?

Answer: Modifier 54 reports that the physician performed only the surgical portion of the global surgical package.

Question 2

Who usually reports Modifier 55?

Answer: The physician who provides the postoperative management during the global period.

Question 3

Why is documentation important for Modifier 54?

Answer: Documentation must demonstrate that postoperative care was transferred to another qualified physician and support the services billed.

Practice Scenario

Scenario

A patient travels to a tertiary care hospital for spinal surgery. The neurosurgeon performs the operation successfully and transfers postoperative care to the patient’s hometown orthopedic surgeon beginning on postoperative day five.

Question

Should Modifier 54 be considered?

Answer

Yes. If the neurosurgeon provided only the surgical service and postoperative care was formally transferred, the surgical CPT® code may be reported with Modifier 54. The physician providing postoperative management may report Modifier 55 according to payer policy.

Related Modifiers

Modifier 55 – Postoperative Management Only.
Modifier 56 – Preoperative Management Only.
Modifier 57 – Decision for Surgery.
Modifier 58 – Staged or Related Procedure During the Postoperative Period.
Modifier 78 – Unplanned Return to the Operating Room.
Modifier 79 – Unrelated Procedure During the Postoperative Period.

Common Billing Mistakes

Reporting Modifier 54 when the surgeon provided postoperative care.
Failing to document the transfer of care.
Billing Modifier 54 on procedures without a global period.
Confusing Modifier 54 with Modifier 55.
Not verifying payer-specific split-care policies.

Key Takeaways

Modifier 54 indicates the provider performed only the surgical portion of the global package.
It is used when postoperative care is transferred to another physician.
Documentation of the transfer is essential.
Medicare and commercial payers may have different reimbursement rules.
Proper use prevents overbilling and supports accurate reimbursement.

References

CMS Medicare Claims Processing Manual.
CMS Global Surgery Booklet.
Medicare Administrative Contractor (MAC) billing guidance.
National Correct Coding Initiative (NCCI) Policy Manual.
Licensed AMA CPT® codebook for official modifier descriptors.

Conclusion

Modifier 54 is an essential surgical modifier used when global surgical care is divided between multiple physicians. By accurately reporting Surgical Care Only, providers ensure appropriate reimbursement while complying with Medicare and commercial payer guidelines. Thorough documentation, clear transfer-of-care records, and a solid understanding of global surgery rules are key to avoiding denials and maintaining coding compliance.

Educational Disclaimer

This article was prepared with the assistance of artificial intelligence (AI) for educational and informational purposes. It is based on publicly available CMS guidance, Medicare billing resources, and general medical billing practices. It is notan official publication of the American Medical Association (AMA), CMS, or any insurance payer. CPT® is a registered trademark of the American Medical Association. Always consult the latest AMA CPT® codebook, CMS manuals, Medicare Administrative Contractor (MAC) guidance, National Correct Coding Initiative (NCCI) policies, and payer-specific billing policies before coding, billing, or submitting claims.