CMS Won't Pay for Wrong-Site Surgery — Here's What NCD 328 Means for Your Claims

CMS has modified National Coverage Determination (NCD) 328, which governs Medicare's non-coverage policy for surgical or other invasive procedures performed on the wrong body part. This update, effective March 12, 2026, reinforces a long-standing billing reality: if a procedure is performed on the incorrect body part due to practitioner error, Medicare will not reimburse it — full stop. For billing teams and revenue cycle directors across virtually every surgical specialty, understanding exactly what triggers this non-coverage determination is essential to avoiding denied claims and compliance risk.

What NCD 328 Covers — and Why CMS Won't Pay for Wrong-Site Procedures

The Centers for Medicare & Medicaid Services does not cover any surgical or other invasive procedure performed on the wrong body part. The policy rationale is straightforward: a procedure performed on an incorrect site cannot be considered a "reasonable and necessary" treatment for the Medicare beneficiary's documented medical condition. Reasonable and necessary is the bedrock standard for Medicare coverage, and a wrong-site procedure fails it by definition.

This determination has roots in the National Quality Forum's (NQF) 2002 "Serious Reportable Events in Healthcare" consensus report, which established the concept of "never events" — adverse outcomes considered serious, largely preventable, and unacceptable in any care setting. Wrong-site surgery has remained on the NQF's never events list through all subsequent revisions, which now include 28 items. CMS aligned its coverage policy with this framework, making explicit that the Medicare program will not absorb the financial cost of these errors.

How CMS Defines "Wrong Body Part" Under NCD 328

The policy is precise about what qualifies as a wrong-body-part procedure. A surgery or invasive procedure is considered to have been performed on the wrong body part when it is not consistent with the correctly documented informed consent for that patient. This explicitly includes:

• Left vs. right errors — operating on the wrong side of the body (wrong appendage or organ)
• Wrong level errors — performing spinal surgery at the incorrect vertebral level

The documentation anchor here is the informed consent form. If the procedure performed does not match what the patient consented to, NCD 328 is triggered.

Important Exceptions CMS Recognizes

The policy carves out several scenarios that do not constitute a wrong-body-part event under this NCD:

1. Emergent intraoperative findings — situations that arise during surgery whose urgency precludes obtaining new informed consent
2. Incidental pathology discovery — when a surgeon discovers pathology in close proximity to the intended site and the risk of a second surgery outweighs the benefit of patient consultation
3. Unusual physical configurations — unexpected anatomical findings such as adhesions, extra vertebrae, or atypical spine levels that alter the surgical plan

These exceptions matter enormously for surgical billing teams. A spine surgeon who identifies an extra vertebra intraoperatively and adjusts the operative level is not, under this policy, performing a wrong-site procedure. The key is documentation — the operative note must clearly capture the clinical reasoning for any deviation from the original surgical plan.

Which Procedures Fall Under This NCD

The scope of NCD 328 is broad. CMS defines surgical and other invasive procedures as operative procedures in which skin or mucous membranes and connective tissue are incised, or an instrument is introduced through a natural body orifice. The policy explicitly covers all of the following:

• All procedures described by codes in the surgery section of the CPT code set
• Percutaneous transluminal angioplasty and cardiac catheterization
• Minimally invasive procedures involving biopsies or placement of probes or catheters requiring entry into a body cavity through a needle or trocar
• Minimally invasive dermatological procedures — including biopsy, excision, and deep cryotherapy for malignant lesions
• Multi-organ transplantation

What's excluded from this definition: instruments used purely for examination (such as otoscopes) and very minor procedures like drawing blood.

The breadth of this definition means NCD 328 is relevant far beyond the OR. Interventional radiologists, cardiologists, dermatologists, and any provider performing biopsies or catheter-based procedures are all within scope.

Medicare Benefit Categories Affected by NCD 328

This NCD applies across a wide range of Medicare benefit categories, meaning the non-coverage determination can affect claims billed under multiple settings and provider types:

• Inpatient Hospital Services
• Outpatient Hospital Services (incident to a physician's service)
• Physicians' Services
• Skilled Nursing Facility
• Home Health Services
• Federally Qualified Health Center Services
• Rural Health Clinic Services
• Diagnostic Tests (other)

Billing teams in hospital outpatient departments, ambulatory surgery centers, and physician practices all need to understand this policy applies to their claims environment.

Affected Codes

This policy does not list specific CPT, HCPCS, or ICD-10 codes. NCD 328 applies categorically to all procedures in the CPT surgery section and any other invasive procedures as defined above — meaning no single code list can capture its full scope. The non-coverage determination is triggered by the circumstances of the procedure (performed on the wrong body part relative to documented informed consent), not by the specific procedure code billed.

This has an important practical implication: your billing system cannot flag this risk through code-based edits alone. The risk management and compliance protocols upstream of billing are what prevent NCD 328 denials.

What Your Billing Team Should Do