Observation Care

The Hospitalist. 2010 July;2010(07):

July 1, 2010 | The Hospitalist

Length of Stay

Observation-care services typically do not exceed 24 hours and two calendar days. Observation care for more than 48 hours without inpatient admission is not considered medically necessary but might be payable after medical review. Should the OBS stay span more than two calendar days (as might be the case with “downgraded” hospitalizations), hospitalists should report established patient visit codes (99212-99215) for the calendar day(s) between the admission service (99218-99220) and the discharge service (99217).³ The physician must provide and document a face-to-face encounter on each date of service for which a claim was submitted.

A more likely occurrence is the admission and discharge from OBS on the same calendar date. The attending of record reports the code that corresponds to the patient’s length of stay (LOS). If the total LOS is less than eight hours, the attending only reports standard OBS codes (99218-99220). The hospitalist does not separately report the OBS discharge service (99217), even though the documentation must reflect the attending discharge order and corresponding discharge plan. If the total duration of the patient’s stay lasts more than eight hours and does not overlap two calendar days, the attending reports the same-day admit/discharge codes:¹

99234: Observation or inpatient care, same date admission and discharge, requiring both a detailed or comprehensive history and exam, and straightforward or low-complexity medical decision-making. Usually the presenting problem(s) is of low severity.
99235: Observation or inpatient care, same date admission and discharge, requiring a comprehensive history and exam, and moderate-complexity medical decision-making. Usually the presenting problem(s) is of moderate severity.
99236: Observation or inpatient care, same date admission and discharge, requiring a comprehensive history and exam, and high-complexity medical decision-making. Usually the presenting problem(s) is of high severity.

OBS discharge service (99217) is not separately reported with 99234-99236 because these codes are valued to include the discharge component (e.g., the comprehensive service, 99236 [4.26 wRVU, $211], is equivalent to its components, 99220 [2.99 wRVU, $148] and 99217 [1.28 wRVU, $68]). The attending must document the total duration of the stay, as well as the face-to-face service and the corresponding details of each service component (i.e., both an admission and discharge note).³TH

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center in Philadelphia. She is also on the faculty of SHM’s inpatient coding course.

References

Abraham M, Beebe M, Dalton J, Evans D, Glenn R. Current Procedural Terminology Professional Edition. Chicago: American Medical Association Press; 2010:11-16.
Medicare Claims Processing Manual: Chapter 12, Section 30.6.7A. Centers for Medicare and Medicaid Services website. Available at: www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 11, 2010.
Medicare Claims Processing Manual: Chapter 12, Section 30.6.8C. Centers for Medicare and Medicaid Services website. Available at: www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 11, 2010.
Medicare Claims Processing Manual: Chapter 12, Section 30.6.8D. Centers for Medicare and Medicaid Services website. Available at: www.cms.hhs.gov/manuals/downloads/clm104c12.pdf. Accessed May 11, 2010.
Medicare Claims Processing Manual: Chapter 1, Section 50.3. Centers for Medicare and Medicaid Services website. Available at: www.cms.hhs.gov/manuals/downloads/clm104c01.pdf. Accessed May 12, 2010.

FAQ

Question: Sometimes the patient requires inpatient admission after initially being placed in observation. How should a hospitalist report the services if he or she is both the attending of record for the OBS care and the inpatient stay?

Answer: If the patient is converted to an inpatient status on the same day as the OBS admission, only an initial inpatient-care service is reported (e.g., 99222). For billing purposes, it is not necessary to redocument another history and physical exam (H&P), but hospitalists should write the new order for inpatient admission and update the OBS assessment with any relevant, new information to justify the need for conversion.

If the inpatient conversion occurs on the second calendar day of the OBS stay, the physician is allowed to report the initial observation care code (e.g., 99220) on day one, and the initial inpatient care code (e.g., 99223) on day two.⁴ Keep in mind that the physician must then meet the documentation guidelines for initial hospital care and redocument a complete H&P to support the reported code (e.g., 99223=a comprehensive H&P and high-complexity decision-making). The hospitalist is only permitted to reference the previous review of systems and histories, and must redocument the history of present illness, exam, and decision-making.

If the physician decides not to document to this level of detail in support of the initial hospital-care service, reporting a subsequent hospital-care code (99231-99233) is considered reasonable. The physician should not report the OBS discharge (99217).

As a part of a contractual agreement, some private payors might convert the patient’s status for the entire episode of care, beginning when the patient was first admitted to OBS. If this occurs, the physician is responsible for reporting the visit category associated with the patient’s status when that status became effective (e.g., inpatient hospital-care codes are reported on day one of a retroactive inpatient status assignment).—CP