# Billing Observation vs. IP for Doc Services



## Jenatsky (Nov 16, 2010)

In the situation where a patient is admitted as OBS status and later changed to IP what should the hospitalist bill?  I have one client who was instructed by a consultant to bill the physician OBS H&P for that service. And when the status was changed by case management to IP the hospitalist should perform another H&P and bill that as well.  The physicians are not happy and against this due to the extra work and unnecessary cost to the patient.  I've researched online and have found nothing. 
I instructed the client to change the OBS services to IP services which will coincide with the hospital billing which will prevent any discrepancy with the payer.  Any and all assistance will be appreciated


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## mitchellde (Nov 17, 2010)

First obs or inp is a status assigned by the attending physician not case management.  If the physician did not write an order to convert the stay to inpatient then the stay is still obs.  If the physician did write the order then did he convert the stay to inpt or did he order admit to inpt on a certain day.  If the order is to convert to inpt then the entire stay is inpt and if you have already billed the first day as obs you will need to submit a corrected claim for the stay as inpt.  If the order is to admit as of say day 2 of obs then you must discharge from obs and admit to inpt.  and you will bill the admit level.  To convert the stay is less work work for the physician as his obs admit note is now the inpt admit note.  Most hospital would prefer that the physician convert the stay.


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## Jenatsky (Nov 17, 2010)

Debra, I appreciate the fact that the physician must write the OBS or IP order but the insurance carrier usually dictates what they will accept. If the IP admit does not meet Interqual criteria the IP status is changed to OBS.  Are you suggesting to simply change everything to match the changed status e.g. H&Pm subsequent care, etc?


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## mitchellde (Nov 20, 2010)

No, the carrier may state what they will accept, however we can code only what is documented and the physician MUST be the one to document the status of either inpatient or observation.  As I said the regs state that hosp UR may evaluate the admission after discharge and determine the criteria met obs status and then request the provider to write an order for inpatient.  If he does not then it stays inpatient, and the hosp must bill it that way.  The carrier may decide what they will pay but the physician gets to decide what he wants for the patient and that is how we are required to bill it.


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