Across the U.S., pulmonology practices are experiencing an overwhelming surge of patients with COPD, asthma flares, post-COVID respiratory issues, sleep disorders, and lung cancer workups. Yet while patient volume is rising, reimbursement isn’t keeping up.

Here’s the alarming reality:

• 18–22% average denial rate for Pulmonology claims (CMS + commercial payers)
• 36 states reporting higher rejected claims for PFTs, bronchoscopy, and sleep studies
• Missed modifiers and incorrect medical-necessity coding cause 42% of denied respiratory claims
• Sleep medicine denials increased 27% between 2023–2024, especially for PAP devices

Pulmonology RCM is becoming one of the most financially volatile specialty workflows high testing volume, strict LCDs, intense documentation requirements, multi-component procedures, and constant code revisions.

This blog breaks down everything you need to know about Pulmonology Billing & Coding in 2025, what’s changing, where revenue leaks occur, and how CloudRCM Solutions helps practices stay compliant while improving cash flow.

Why Pulmonology RCM Matters More in 2025

Pulmonology sits at the intersection of high-acuity care and high-regulation billing. Every CPT, ICD-10, modifier, and PFT parameter must align with strict CMS and payer rules.

Why RCM is mission-critical:

Pulmonary testing is multi-component

Spirometry, DLCO, plethysmography, bronchodilation, and oxygen titration all involve layered coding and multiple billable components.

More patients = more authorizations

Bronchoscopy, advanced imaging, PAP devices, oxygen therapy, and rehab often require pre-approval.

Medicare is tightening medical-necessity documentation

Especially for:

• COPD exacerbation management
• Pulmonary rehab
• PAP device compliance
• Oxygen qualification testing

MIPS 2025 adds a Pulmonology Value Pathway

Meaning coding, quality reporting, and documentation directly affect payments.

A strong pulmonology RCM strategy no longer “supports” financial health
It protects your entire practice from reimbursement collapse.

U.S. Trends, State Statistics & Specialty Data

Rising Respiratory Volume

• COPD affects 16+ million Americans
• Asthma impacts 26 million, with the highest rates in Texas, Louisiana, Georgia & Arizona
• Sleep apnea now affects 30 million U.S. adults, increasing PAP-related billing

States with the highest pulmonary denial rates:

• Florida
• Texas
• Tennessee
• California
• New Jersey

Specialty-Specific Revenue Risks

Pulmonologists dealing with:

• PFT-heavy clinics
• Sleep studies
• In-office bronchoscopy
• Chronic disease management (COPD, ILD)
• DME (CPAP, oxygen, nebulizers)

All face higher audit risk and tighter payer scrutiny.

Step-by-Step Process of Pulmonology Billing

1: Authorization & Eligibility Check

Respiratory procedures that commonly require prior authorization:

• Bronchoscopy
• CT chest
• PAP setup (E0601)
• Pulmonary rehab sessions
• High-cost inhalation therapy

Failure in this phase = denials later.

2: Clinical Documentation Collection

Pulmonary documentation must include:

• Procedure indications
• Consent
• Detailed PFT parameters
• Tech supervision
• Device setup notes
• Sleep study results

Even minor missing elements cause Medicare denials.

3: Coding & Charge Capture

CloudRCM frequently sees:

• Missing modifier 25 (E/M + PFT same day)
• Wrong ICD-10 sequencing
• Missed add-on procedure codes for bronchoscopy

4: Claim Submission

Each payer (Medicare, Medicaid, commercial) requires:

• Sleep study documentation
• Oxygen testing results
• Rehab session notes
• PAP compliance logs
• Device serial numbers

5: Payment Posting & Denial Resolution

Top denial categories for pulmonology:

• Missing medical necessity
• Wrong modifier
• Authorization not on file
• DME coverage limitations
• LCD not met

6: Reporting & Compliance Audits

KPIs needed:

• Clean claim rate
• Denial %
• A/R over 90 days
• PFT utilization
• Missed charge analysis

CloudRCM provides real-time dashboards for these.

Revenue Leaks & Common Denial Triggers

These issues cost pulmonologists 10–22% of annual revenue:

•  Incorrect coding for PFT components
•  Missing Modifier 25 or 59
•  Unbillable sleep studies due to missing documentation
•  Bundling errors for bronchoscopy
•  Not meeting the Medicare LCD requirements for oxygen
•  Poor DME documentation
•  Unsubmitted secondary claims
•  No appeals filed

Avoiding these alone boosts revenue by 15–25%.

Key Pulmonology CPT & ICD-10 Codes

CPT Code	Description
94010	Spirometry
94726	DLCO (Diffusing capacity for carbon monoxide)
94640	Nebulizer therapy
94618	Pulmonary stress test
31622	Diagnostic bronchoscopy
31625	Bronchoscopy with biopsy
95806	Home sleep test
95810	Polysomnography

ICD-10 Code	Description
J44.9	COPD (Chronic Obstructive Pulmonary Disease)
J45.909	Asthma (unspecified)
G47.33	Sleep apnea
J18.9	Pneumonia
J84.9	Interstitial lung disease (ILD)
I27.2	Pulmonary hypertension

CMS, Medicare & Medicaid Updates Affecting Pulmonology

New 2025 Pulmonology MIPS Pathway

Includes measures for:

• COPD
• Asthma
• PFT documentation
• Smoking cessation

Medicare Coverage Expansions

• Post-COVID respiratory rehab
• Improved PAP device documentation requirements
• Updated LCDs for oxygen qualification

Medicaid Variations by State

California, Texas, and Ohio updated:

• Sleep study coverage limits
• Therapy session caps
• Device replacement intervals

Pulmonologists must follow state-specific rules (CloudRCM tracks these automatically).

Optimization Tips to Strengthen Pulmonology RCM

Maintain a real-time coding cheat sheet

Pulmonary codes change yearly keep them updated.

Standardize documentation templates

Especially for:

• Bronchoscopy
• Rehab
• PAP
• Sleep tests

Audit PFT documentation quarterly

Most denials come from missing calibration, time logs, tech supervision details.

Track payer behavior every month

Aetna, UHC, Cigna, and BCBS update pulmonary policies frequently.

Outsource when volume increases

Pulmonology is too complex for general medical billers.

How CloudRCM Solutions Helps Pulmonologists

CloudRCM does NOT just “submit claims,” we build a full RCM infrastructure tailored to pulmonology.

What Makes CloudRCM Different

• Pulmonology-certified coders (AAPC)
• Pre-auth team dedicated to respiratory procedures
• Detailed review of PFT, PAP & sleep study documentation
• Modifier & bundling accuracy checks
• 98% clean claim rate
• 30–40% reduction in A/R days
• Specialty-specific denial management

Services We Customize for Pulmonology

• Pre-authorization + benefits verification
• Coding for PFTs, sleep studies, bronchoscopy
• DME billing (PAP, oxygen, nebulizers)
• Medicare compliance checks
• Denial appeals with medical-necessity support
• Monthly KPI dashboards

Outcome

CloudRCM ensures pulmonology practices get reimbursed:

• Faster
• With fewer denials
• With higher accuracy
• Without burdening your clinical team

Final Words

Pulmonology billing has become one of the most demanding RCM specialties in 2025. Rising patient volume, stricter CMS rules, DME challenges, sleep study documentation requirements, and complex coding structures make it easy for practices to lose thousands every month.

A reliable pulmonology RCM partner can change the entire financial landscape of your practice.

CloudRCM Solutions helps pulmonologists simplify billing, stay compliant, reduce denials, and strengthen cash flow all while you stay fully focused on patient care.

FAQs

Why is pulmonology billing more complex than other specialties?

Because it involves multi-component tests (PFTs), bundled procedures, strict documentation rules, and frequent prior authorizations.

What are the most common causes of pulmonology claim denials?

Missing modifiers (25/59), incomplete PFT documentation, no prior auth, incorrect ICD-10 for medical necessity, and payer-specific policy violations.

Which pulmonology services require prior authorization?

Sleep studies, CT chest, bronchoscopy, PAP devices, oxygen therapy, and high-cost DME.

Why do Medicare and Medicaid denials happen so frequently in pulmonology?

They require strict medical necessity proof, PFT documentation elements, sleep study reports, and adherence to LCD/NCD policies.

How can pulmonology practices reduce A/R days?

By improving pre-auth processes, accurate coding, consistent documentation, and proactive denial management.

Does coding accuracy affect MIPS and incentive payments?

Yes. CMS’s Pulmonology Value Pathway requires accurate coding + quality reporting for COPD, asthma, and sleep apnea.

Can outsourcing pulmonology billing improve revenue?

Yes. Specialized teams reduce denials, ensure compliance, and accelerate reimbursements.

How does CloudRCM Solutions support pulmonology practices?

By handling coding, claims, pre-auths, denials, and compliance so pulmonologists focus on patient care.