How do you get paid?
How do you get paid?
Observation Coding and Billing
Michael Ross MD FACEP
P id t S i t f Ch t P i C t President, Society of Chest Pain Centers
Medical Director, Chest Pain Center and Observation Medicine Associate Professor, Department of Emergency Medicine
Emory University School of Medicine
Atl t G i
Objective: Learn coding and billing
Objective: Learn coding and billing
issues for observation services
1. Professional (CPT) coding and billing
CPT and CMS issues
Professional compliance issues
2. Hospital (APC) coding and billing
CMS
[Note: Private contract (ie BCBS) issues will not
be covered (too many to consider)]
My “Observation” Background
CPT history – same day codes
BC/BSM history
BC/BSM history
CMS - APC Advisory Panel, Visit and
Observation Subcommittee
Observation Subcommittee
Lesson – always go by written policy
Professional Coding and Billing
1.
CPT issues
2
CMS issues
2.
CMS issues
CPT: Observation Services
“. . . used to report the evaluation and management
services provided to patients designated / admitted
as “observation status” in a hospital
as “observation status” in a hospital.
It is not necessary that the patient be located in an
It is not necessary that the patient be located in an
observation area designated by the hospital.
If such an area exists in a hospital (as a separate unit
in the hospital, in the ED, etc), these are the codes to
be utilized
”
CPT: Observation Care –
“Discharge Services”
“Observation care discharge of a patient from
“observation status” . . .
[Note – “status” vs “hospital”, covered when
admitted to another service.]
. . . includes final examination of the patient, discussion
of the hospital stay, instructions for continuing care, and
preparation of discharge records.”
CPT: Observation – Initial Care
“When “observation status” is initiated in the course of an encounter
in another site of service (eg, hospital ED, physician's office, nursing facility) all evaluation and management services provided by the
supervising physician in conjunction with initiating “observation status” supervising physician in conjunction with initiating observation status are considered part of the initial observation care when performed on the same date. The observation care level of service reported by the supervising physician should include the services related to initiating “observation status” provided in the other sites of service as well as inobservation status provided in the other sites of service as well as in the observation setting. E/M services on the same date provided in sites that are related to initiating “observation status” should not be reported separately.”
[Note – “ladder analogy”:
Clinic or Emergency E/M services Observation E/M services
I ti t E/M i ]
Inpatient E/M services]
CPT rule:
A physician can not bill two E/M codes
on the same calendar dayy
So what happens if a patient has both
So what happens if a patient has both
initial observation care AND observation
discharge care on the same day?
This violates the “same day” rule.
The solution is . . .
CPT: Observation or Inpatient Care
Services (including admission and
Services (including admission and
discharge services)
The following codes are used to report
observation or inpatient hospital care
observation or inpatient hospital care
services provided to patients admitted
and discharged on the same date of
and discharged on the same date of
service.
[Note – same rules as above apply (other
[Note same rules as above apply (other
CPT Overview: Emergency Services
5 EMERGENCY CPT CODES: 99281-99285
Independent of time of day or length of stay Independent of time of day or length of stay
No separate payment for the work of “discharging” a
patient
Observation and Inpatient CPT codes recognize the work of
Observation and Inpatient CPT codes recognize the work of
discharging a patient
“Discharge” work is over and above the work of the initial
“H&P” (or initial evaluation and management)
Initial evaluation and management (or “H&P”) documentation
requirements and payment levels are similar for emergency, observation, and inpatient CPT codes.
CPT Overview: Observation Services
7 OBSERVATION CPT CODES: Two day case:
99218 - 20 Initial day of observation care
99217 - Observation care discharge day management
One day case:
99234 36 Ob ti i ti t h it l f th
99234 - 36 Observation or inpatient hospital care, for the
evaluation and management of a patient including admission and discharge on the same date:
These codes basically combine discharge (99217) and initial y g ( )
observation care (99218 - 20) into one code (99234 - 36) for cases which come and go on the same day .
Two scenarios – 1 vs 2 days
ONE DAY SCENARIO:
ED Obs D/C
12A One day “combo” codes (initial E/M + d/c) 12A 99234, 35, 36
TWO DAY SCENARIO:
ED Obs D/C
12A Obs discharge code - 99217 Initial E/M
EMERGENCY & OBSERVATION CPT CODES:
Required Documentation * Service CPT History Physical M.D.M. 2010 Total RVUs Emergency level 1 99281 PF PF S 0.58Emergency level 2 99282 EPF EPF L 1.12
Emergency level 3 99283 EPF EPF M 1.71
Emergency level 4 99284 D D M 3.21 Emergency level 5 99285 C C H 4.74 Observation Discharge 99217 + + + 1.88 Observation level 1 99218 D or C D or C S or L 1.77 Observation level 2 99219 C C M 2.93 Observation level 3 99220 C C H 4.1
Same day Obs / dschg 1 99234 D or C D or C S or L 3.59
Same day Obs / dschg 2y g 99235 C C M 4.714.71
Two Physician Billing scenarios:
S
i 1 S
h i i
/
Scenario 1. Same physician / group –
observation replaces emergency
The observation code is billed instead of the emergency code
Incrementally added work of observation is covered by the observation
discharge codes discharge codes
You do not need to repeat the initial H&P For example – a possible scenario:
Emergency
level of care
Observation
“level of care”:
Observation
Care covers
Observation
Care all on the
(Not billed)
(Billed)
two days** same
day*
99283
1
99218 + 99217
99234
99284
2
99219 + 99217
99235
99284
2
99219 + 99217
99235
99285
3
99220 + 99217
99236
Two billing scenarios:
Scenario 2. Initial Emergency and
Observation are Different “Physicians”
Two different H/Ps done (emergency and
observation plus discharge) by two different
p
g ) y
“physicians”.
What is a “Physician”?
What is a Physician ?
Same group (ie tax ID code)
Medicare Claims Processing Manual
Chapter 12 - Physicians/Nonphysician Practitioners Table of Contents
(Rev. 2044, 09-03-10)
30.6.5 - Physicians in Group Practice (Rev. 1, 10-01-03)
Physicians in the same group practice who are in the same specialty
t bill d b id th h th i l h i i If
must bill and be paid as though they were a single physician. If more than one evaluation and management (face-to-face) service is
provided on the same day to the same patient by the same physician or more than one physician in the same specialty in the same group,
l l ti d t i b t d l
only one evaluation and management service may be reported unless the evaluation and management services are for unrelated problems. Instead of billing separately, the physicians should select a level of service representative of the combined visits and submit the
i t d f th t l l appropriate code for that level.
Physicians in the same group practice but who are in different
specialties may bill and be paid without regard to their membership in the same group. g p
Appendix B
CMS Provider Specialty Table Edited to Include Only Physicians, Physician Assistants and Nurse Practitioners for GEM Project Physician Grouping TIN Selection and Patient Attribution
(1) (2) Provider Specialty Codes
Flagged for Patient Attribution for GEM
Provider Specialty Codes including Physicians, Physician Assistants and Nurse Practitioners for
Physician Grouping TIN Selection
Primary Care ✓ 01 = General practice ✓ 01 General practice ✓ 08 = Family practice ✓ 11 = Internal medicine ✓ 16 = Obstetrics/gynecology ✓ 38 G i t i di i ✓ 38 = Geriatric medicine
✓ 70 = Multi-specialty clinic or group practice ✓ 84 = Preventive medicine
Specialty Attribution for Specific Measures
02 = General surgery 03 = Allergy/immunology 04 = Otolaryngology 05 A th i l 05 = Anesthesiology * 06 = Cardiology 93 = Emergency medicine 94 = Interventional radiology 98 = Gynecologist/oncologist 99 = Unknown Physician Specialty
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 , g regarding whether patients will require further treatment as hospital inpatients or if they are able to be discharged from the hospital.
[Note – defining feature is to determine the need for inpatient admission]
In only rare and exceptional cases do reasonable and
necessary outpatient observation services span more than
necessary outpatient observation services span more than
48 hours.
“
. . . physician present and personally
physician present and personally
performed the services”
What about “physician extenders”?
Do they qualify as the “physician” who is
present and personally performed the services?
present and personally performed the services?
Observation documentation:
Document emergency H&P
Must include family history:
3/3 instead of 2/3 for personal/family/social history
Order observation of the patient (observation doc) Document ongoing care in progress notes
Document time in observation (may be electronic stamps) At the end, document a discharge summary:
A fi l i ti
A final examination
Clinical course in the unit – results, decision making, diagnosis, etc. Preparation of discharge (or admit) records
CPT Observation billing issues:
Scenario 1: You must use the observation codes, instead of
emergency codes, if you provide both services.
“Same” physician - means any physician in
the same specialty / same group
the same specialty / same group.
You may not have the first ED physician bill an
emergency E&M and the second emergency
physician bill an observation E&M if they are
CPT Observation billing issues:
il hi
i
i d
Family history is required
or down-coding will occur (unique to observation and inpatient E/M codes, not emergency). Midlevel may do.
When does the clock start for emergency physicians
billing observation (scenario 1)?
Interpretation: The clock starts at triage because emergency Interpretation: The clock starts at triage because emergency
and observation services are bundled into one CPT code, and malpractice expense / risk begins at triage.
“Same day” code LOS issues: 8 hour minimum
99234-6 paid if LOS>8hr. If < 8 hr, then use 99218-20 without a discharge code.
Hospital Billing –
Observation Services
CMS and APCs – history and how they
work
work
What is an “observation patient” what is
What is an “observation patient” what is
an “inpatient”?
CMS definition of observation
3663 OUTPATIENT OBSERVATION SERVICES
3663. OUTPATIENT OBSERVATION SERVICES
Same as for physician (above):
to determine the need for a possible
. . . to determine the need for a possible
admission as an inpatient...
d o l
he
o ided b o de of
... covered only when provided by order of a
physician or … individual authorized … to order
outpatient tests. . .
… Observation services exceeding 48 hours
will be denied.
CMS observation payment history:
CMS observation payment history:
1999 - present
Pre-2000 – Hourly billing using Revenue
code 762
Problems with prolonged stays and inappropriate
post-op use of observation
p
p
2000 (OPPS / APC) – Observation
2000 (OPPS / APC) Observation
“packaged” (not paid separately)
Powerful disincentive to use observation
Powerful disincentive to use observation,
CMS observation payment history:
CMS observation payment history:
cont. . .
2002 – Observation unpackaged for 3 conditions
Chest Pain, Asthma, CHF with multiple criteria required
2005 – Multiple criteria restrictions lifted
2007 – Condition restriction lifted, and folded into a
“composite” APC with ED or clinic visit APC
Facility / APC billing
How does APC billing work?
Separate APCs for:
Tests – Stress test, chest x-ray
Certain drugs
“VISITS”
ED Clinic Critical Care and
VISITS – ED, Clinic, Critical Care, and
Observation visits
Unlike a DRG where all services are paid under
the same umbrella (including ED/observation
preceding admission).
2007: Observation APC billing
APC 0339 (~30%) -
Observation was “Un-bundled”.
Payment was “in addition to” ED payment for:
Chest pain
Asthma
CHF
All th
diti
( 70%)
“b dl d”
All other conditions (~70%) - were “bundled”
2008
Hospital Financial impact of
2008
Hospital Financial impact of
“100” Medicare Patients (APC 8003)
2007 Pymt 2007 Total $ Proposed Pymt* Proposed Total $ 2008 Pymt** 2008 Total $ ED level 5 (with obs)
ED level 5 (with obs)
(n=100) $325 $32, 500 $348 $34,800 *0 *0
Obs - CP, Asthma, CHF
(n=30) $442 $13,260 0 0 $639 $19,170
( )
Obs - All others
(n=70) $0 $0 0 0 $639 $44,730
$45 760 $34 800 $63 900
TOTAL (Emeg + Obs) $45,760 $34,800 $63,900
* All ED level 5s would be paid at this rate, including non-observation cases ** ED l l 5 th t t d itt d f b ti id $315
Extended Assessment and
Management Composite APC
1. Observation Time
a. Observation time must be documented in the medical record.
b. A beneficiary's time in observation (and hospital billing) begins with the beneficiary's admission to an observation bed.
c. A beneficiary's time in observation (and hospital billing) ends when all clinical or medical interventions have been completed, including follow-up care furnished by hospital staff and physicians that may t k l ft h i i h d d th ti t b l d take place after a physician has ordered the patient be released or admitted as an inpatient.
d. The number of units reported with HCPCS code G0378 must equal p q or exceed 8 hours.
APCs 8003 and 8002
APCs 8003 and 8002
2. Additional Hospital Services
- a. The claim for observation services must include one of the following
services in addition to the reported observation services. . . on the same day or the day before the date reported for observation:
For APC 8003:
An emergency department visit (CPT code 99284 or 99285) or A clinic visit (CPT code 99205 or 99215); or
Critical care (CPT code 99291); or
For APC 8002:
Direct admission to observation reported with HCPCS code G0379,
must be reported on the same date of service as the date reported for must be reported on the same date of service as the date reported for observation services.
b. No procedure with a “T'' status indicator can be reported on the same day or
day before observation care is provided. y p
[note – “T” status indicates major procedures, such as endoscopy, heart cath, etc. This solves the “post op” observation issues.]
APCs 8003 and 8002 cont
APCs 8003 and 8002, cont.
3. Physician Evaluation
Th b
fi i
t b i th
f
h i i
a. The beneficiary must be in the care of a physician
during the period of observation, as documented in
the medical record by admission, discharge, and
th
i t
t
th t
ti
d
other appropriate progress notes that are timed,
written, and signed by the physician.
b. The medical record must include documentation
that the physician explicitly assessed patient risk to
determine that the beneficiary would benefit from
y
How does this all come together?
Claims processing and the CMS Outpatient Claims Editing (OCE) softwarep g p g ( )
How are observation /
inpatient cases defined???
Interqual
v.s.
What is interqual?
q
Provides screening criteria for patients who are admitted
Provides screening criteria for patients who are admitted
as an inpatient.
McKesson is a service subscribed to by payers and
hospitals for this purpose.
hospitals for this purpose.
NOT intended to supersede physician judgement
How is it used?
How is it used?
Large book full of complicated information
Nurse screens admission
If criteria - provides information to physician for
If criteria provides information to physician for
his/her consideration
Clarification or changes in IP status may be made
How are observation or
inpatient cases defined???
Hospital Manual
Chapter II - Coverage of Hospital Services
210 COVERED INPATIENT HOSPITAL SERVICES 210. COVERED INPATIENT HOSPITAL SERVICES Page 21.3/Rev. 525, 01-89
An inpatient is a person who has been admitted to a hospital p p p
for bed occupancy for purposes of receiving inpatient hospital services. Generally a person is considered an inpatient if formally admitted as an
inpatient with the expectation that he will remain at least overnight and occupy a bed even though it later develops that he can be discharged or transferred to another hospital and does not actually use a hospital bed transferred to another hospital and does not actually use a hospital bed overnight.
[ Note – The Hospital Manual definition is the ultimate
[
p
Hospital Manual
Chapter II - Coverage of Hospital Services
210 COVERED INPATIENT HOSPITAL SERVICES 210. COVERED INPATIENT HOSPITAL SERVICES Page 21.3/Rev. 525, 01-89
The physician or other practitioner responsible for a patient's care at the hospital is also responsible for deciding whether the patient
should be admitted as an inpatient.
The physician should use a 24-hour period as a benchmark, i.e., he or she should order admission for patients who are expected to need
hospital care for 24 hours or more, and treat other patients on an p , p outpatient basis.
However, the decision to admit a patient is a complex medical judgment which can be made only after the physician has considered a number which can be made only after the physician has considered a number of factors, including the patient's medical history and current medical
needs, the types of facilities available to inpatients and to
outpatients, the hospital's bylaws and admissions policies, and the relative appropriateness of treatment in each setting
Hospital Manual
Chapter II - Coverage of Hospital Services
210 COVERED INPATIENT HOSPITAL SERVICES 210. COVERED INPATIENT HOSPITAL SERVICES Page 21.3/Rev. 525, 01-89
Factors to be considered when making the decision to admit include such things as:
The severity of the signs and symptoms exhibited by the
patient: patient:
The medical predictability of something adverse happening to
the patient:p
The need for diagnostic studies that appropriately are outpatient
services (i.e., their performance does not ordinarily require the patient to remain at the hospital for 24 hours or more) to assist patient to remain at the hospital for 24 hours or more) to assist in assessing whether the patient should be admitted; and
The availability of diagnostic procedures at the time when and y g p
Hospital Manual
Chapter II - Coverage of Hospital Services
210 COVERED INPATIENT HOSPITAL SERVICES 210. COVERED INPATIENT HOSPITAL SERVICES Page 21.3/Rev. 525, 01-89
“Admissions of particular patients are not
covered or noncovered solely on the
covered or noncovered solely on the
basis of the length of time the patient
actually spends in the hospital.”
actually spends in the hospital.
What about inpatients who
don’t meet inpatient criteria?
The Use of Condition Code 44
In some instances, a physician may order a
, p y
y
beneficiary to be admitted to an inpatient bed,
but upon subsequent review, it is determined
that an inpatient level of care does not meet the
hospital’s admission criteria. The National
Uniform Billing Committee (NUBC) issued
Uniform Billing Committee (NUBC) issued
Condition Code 44, effective April 1, 2004, to
identify cases when this occurs.
Condition code 44. . .
The definition of Condition Code 44 is as follows:
Condition Code 44 Inpatient admission changed to
outpatient
provided all of the following conditions
outpatient . . . provided all of the following conditions
are met:
The change in patient status from inpatient to outpatient is made
prior to discharge or release, while the beneficiary is still a
i f h h i l patient of the hospital;
The hospital has not submitted a claim to Medicare for the
inpatient admission;
A physician concurs with the utilization review committee’s A physician concurs with the utilization review committee s
decision; and
The physician’s concurrence is documented in the patient’s
Problems with interqual
Not intuitive to most physicians
It is not clear how well it has been
It is not clear how well it has been
tested or validated for observation
patients
patients
May be partially driving shifts in
inappropriate overutilization of
inappropriate overutilization of
observation in the elderly
Rising volumes of claimsg
◦ Shift to outpatient setting, interqual, RAC, expanded dx.
5yr rise in % patients >48 hours (3% to 7%)
◦ Setting driven – IP vs EDOUSetting driven IP vs EDOU
Eating into 3-day SNF qualifying time
◦ Setting driven – IP vs EDOU
Confusing billing rules Confusing billing rules
An observation unit is effective for the elderly
74% are safely discharged in 15.8 hours
Ross et al. Ann Emerg Med. May 2003;41(5)
800 Chest Pain Dehydration 600 400 O bservation Dehydration Asthma Back Pain Abdominal Pain Cellulitis Co u n t 200 0 Reason For O Cellulitis Syncope Pyelonephritis COPD Vertigo All Patients 36 30 24 18 12 6 Mean(<65) = 14.4 hr Mean(>65) = 15.8 hr CHF Atrial Fibrillation
Unadj sted Odds Ratio for Admission
3.0 2.5 2.0 1.5 1.0 .5 0.0 Mean(>65) 15.8 hr Difference (95%CI) = 1.4 (1.24-1.59)
