Observation care in hospital and Emergency room (ER)

IN THE HOSPITAL

In the hospital setting, things are somewhat more complicated. If you are "consulted" to see an INPATIENT in the hospital, you would bill for an H&P (initial hospital care) using the 99221, 99222 or 99223 level of care. The rules have now been changed to allow multiple "H&Ps" on the same patient by different providers. The admitting physician will attach a new modifier (AI) identifying them as the primary doctor for that hospitalization. Consultants should NOT attach this modifier.

                If the patient is currently admitted under OBSERVATION status, he or she is technically considered to be an OUTPATIENT when it comes to E/M coding and billing. Therefore, if you are consulted to see an observation patient in the hospital, we have to use either the new office visit codes (99201 -99205) or the established office visit codes (99211 - 99215), depending upon whether the patient has been seen by the consulting physician or any physician in his or her group within the past three years. This is where the financial impact of the new changes wil likely be the most severe. For example, if a cardiologist gets called in to see a patient in the middle of the night for chest pain and the patient happens to be an observation patient and happens to have been seen by a physician from the same specialty in his or her group within the past three years, you would only be able to bill for an established office patients (maximum facility fee $99) as opposed to a high level consult (maximum facility fee $199).

IN THE ER
If you are "consulted" to come and see a patient in the ER, you first need to determine if the patient is going to be discharged or admitted. If you agree the patient can be safely discharged, you would bill your "consult" as an ER visit, just like the ER doctor. The rules have now changed such that multiple doctors can charge for ER visits on the same patient on the same day. If the patient is being admitted to YOUR service, you would do an admission H&P and attach the AI modifier. If the patient is going to be admitted by another doctor, you will have to find out if he or she is going to be admitted under observation status or as an inpatient. If the patient is admitted for observation, you would use either the new office patient codes or the established office patient codes (depending on whether or not the patient has been seen by you or your group in the past three years). If the patient is being admitted as an inpatient, you would perform and document your "consult" as an H&P (99221, 99222 or 99223) without attaching the AI modifier.

Emergency Room (ER) Services That Span Multiple Service Dates

Emergency room (ER) services provided by hospital outpatient departments (OPPS & Non-OPPS) should be billed in the following manner:

• Emergency room services are reported under the 045x revenue code

• The line item date of service for the ER encounter is the date the patient entered the ER even if the patients encounter spans multiple service dates

• For all other services related to the ER encounter (i.e., lab, radiology, etc) the line item date of service reported is the date the service was actually rendered

Payment for Hospital Observation Services and Observation or Inpatient Care Services (Including Admission and Discharge Services)

A. Who May Bill Observation Care Codes
Observation care is a well-defined set of specific, clinically appropriate services, which include ongoing short term treatment, assessment, and reassessment, that are furnished while a decision is being made regarding whether patients will require further treatment as hospital inpatients or if they are able to be discharged from the hospital. Observation services are commonly ordered for patients who present to the emergency department and who then require a significant period of treatment or monitoring in order to make a decision concerning their admission or discharge.

In only rare and exceptional cases do reasonable and necessary outpatient observation services span more than 48 hours. In the majority of cases, the decision whether to discharge a patient from the hospital following resolution of the reason for the observation care or to admit the patient as an inpatient can be made in less than 48 hours, usually in less than 24 hours.

Contractors pay for initial observation care billed by only the physician who ordered hospital outpatient observation services and was responsible for the patient during his/her observation care. A physician who does not have inpatient admitting privileges but who is authorized to furnish hospital outpatient observation services may bill these codes.

For a physician to bill observation care codes, there must be a medical observation record for the patient which contains dated and timed physician’s orders regarding the observation services the patient is to receive, nursing notes, and progress notes prepared by the physician while the patient received observation services. This record must be in addition to any record prepared as a result of an emergency department or outpatient clinic encounter.

Payment for an initial observation care code is for all the care rendered by the ordering physician on the date the patient’s observation services began. All other physicians who furnish consultations or additional evaluations or services while the patient is receiving hospital outpatient observation services must bill the appropriate outpatient service codes.
For example, if an internist orders observation services and asks another physician to additionally evaluate the patient, only the internist may bill the initial and subsequent observation care codes. The other physician who evaluates the patient must bill the new or established office or other outpatient visit codes as appropriate.
For information regarding hospital billing of observation services, see Chapter 4, §290.
B. Physician Billing for Observation Care Following Initiation of Observation Services
Similar to initial observation codes, payment for a subsequent observation care code is for all


IN THE OFFICE

In the office setting, we will have to bill for "consults" using the new office patient codes (99201 - 99205). However, if the patient has been seen by you or by another physician in the same specialty in your group within the previous three years, you cannot use the new office patient codes and must instead use the established office visit codes (99211 -99215).