Home By the Numbers Switching inpatient to obs: How do you bill?

Switching inpatient to obs: How do you bill?

Plus, coding palliative care consults

Getty Images; Sudok

Editor’s note: In response to this article and the questions arising concerning billing in the ED department, Sue A. Lewis, RN, CPC, PCS, takes another look at some ED billing scenarios in our August 2018 issue.

READERS HAVE SENT IN in more questions, and it’s no surprise that issues related to how to code for observation services crop up. Here’s what readers want to know.

Changing inpatient status
We are struggling with how to code when the hospital indicates a “patient status” of outpatient vs. observation.

Our hospitalist puts in an order to admit as inpatient, but utilization review the next day determines that the patient should be observation. Because observation cannot be backdated, the hospital enters outpatient on the date of “admission” and observation for the next day (date of determination). On the day the patient arrived, our hospitalist documented an H&P. What can we bill, now that the admit date is entered as outpatient?

This is a challenge that has existed since observation status first reared its ugly head! While “observation” is a bed type and a patient status, it’s not a place of service. So you don’t need to worry that your hospital will classify one service as outpatient and another as observation.

While “observation” is a bed type and a patient status, it’s not a place of service.

When a patient’s status is changed from inpatient to outpatient observation, the physician who performed the initial hospital care (reflected in CPT codes 99221–99223) will need to change the initial care code originally reported to the observation CPT code that best reflects the care provided on the first date the patient arrived.

If that hospitalist is not available—because he or she went off service, for example—another hospitalist may make that code change if they both are in the same group and have agreed to allow each other to make such changes. As for how to bill charges on those two days: If the doctor who first saw the patient is also treating the patient in observation the next day, he or she would bill initial observation care the first day, then subsequent observation care (99224-99226) the next.

But if the hospitalist seeing the patient on the second day is not the original attending, he or she should bill an established patient service (9921199215) for that second day service.

ED evaluations
When our hospitalists are asked to come evaluate a Medicare patient in the ED to decide whether or not the patient should be admitted, should we bill ED CPT codes 99211-99215 (established patient office visits) or 99201-99205 (new office visits)?

When hospitalists evaluate a patient in the ED, they should roll that time into either their initial care code (99221–99223), if they decide to admit the patient, or an initial observation code (99218-99220) if the patient is placed instead in observation.

But it’s unclear from your question: Are you asking if hospitalists can bill for time spent in the ED evaluating a patient if they ultimately decide to discharge the patient home from the ED, instead of either admitting or placing in observation?

While that situation may come up, I don’t think that hospitalist time is billable. A hospitalist assessing a patient in the ED to see if he or she should be admitted would be duplicating work the ED should already be performing—and billing for.

Palliative consults
When our providers are called in for a palliative consult, they document the appropriate E/M code. But they also want to add 99497 or 99498 for advance care planning, so I need some guidance. Do I apply Z51.5 (encounter for palliative care) on the E/M code and on the 99497? Are these valid encounters if I use both codes?

You can append the Z51.5, which represents the encounter for palliative care, to the E/M service. If the patient has a diagnosis related to a medical condition that necessitates palliative care, that might be a more appropriate diagnosis code to append to the advance care planning service.

Home health certifications
We have been billing home health certifications with G0180 for hospitalists. But during a presentation, our Medicare administrative contractor (MAC) stressed that the community physician/ provider who would be managing the patient after discharge should be the one to bill and report the G0180. What’s your take?

Here’s my rule of thumb: Trust your MAC. If they give you guidance on something like this, my advice would be to follow it.

But I’ll also mention two articles issued by the Centers for Medicare and Medicaid Services (CMS) that may be some help. Both are Medicare Learning Network articles. The first is MLN Matters article SE1436, the second is MM9119. Both articles contain a reference that a home health certification can be performed by a physician of a certain specialty in an acute or post-acute care facility, as long as the patient goes directly into a home health stay.

A CMS update
One final note: The CMS this February released an update on medical student documentation, allowing medical students to document components of an evaluation and management service. This would include documenting the history (history of present illness, review of systems, and past medical, family and social history), physical examination and medical decision-making.

Teaching physicians must not only verify the student documentation in the patient’s medical record, but they must also personally perform (or re-perform) the physical examination and medical decision-making components of the E/M service being billed and indicate that they have done so. But according to the update, teaching physicians do not need to re-document what the medical student has already documented unless they need to add to or correct any of that documentation based on their performance of critical or key components of the encounter.

That revision took effect in March.

Sue A. Lewis, RN, CPC, PCS, has more than 40 years of health care experience.


Published in the May 2018 issue of Today’s Hospitalist
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August 2022 5:10 pm

Our nighttime hospitalist made the decision to admit a patient before midnight, but no CCU beds were available. He did not place an order but did complete an admission HPI that states the ER doctor agreed to board and manage the patient until a bed comes available, and at that time the daytime hospitalist could enter the order to admit. This is what occurred, but the daytime hospitalist documented as a subsequent visit and not an admit. How do I bill this? My initial instinct is to bill the first as an ER consult, as the hospitalist group did not… Read more »

shirley forbes
shirley forbes
July 2022 7:25 am

What happens when a patient come into the Emergency room and is admitted as an Inpatient on 7/11/22 then on 7/13/22 the patient is downgraded to OBU. How does the hospital bill for this if we go an initial Inpatient authorization?

November 2018 1:46 am

Coding ED charts are always interesting in hospital setting…coding of infusion, injection, IV etc. great information…thanks..!!

Bela Nand
Bela Nand
May 2018 12:47 pm

I believe for the scenario where the hospitalist is consulted by ED physician and then the patient is discharged out of ED, the hospitalist could document the consult and then bill a consult code.

June 2018 12:21 pm
Reply to  Bela Nand

We were told to bill 99281-99285 on Medicare ed consults that are discharged and 99241-99245 on non-Medicare ed consults that are discharged.