# Hospital Charging 99201 as a Facility Charge?



## phaliscak (Sep 14, 2008)

What's that about??  Here is the story. My son had an appointment with a specialist within the hospital. Nothing special, nothing that was the result of an inpatient visit, nothing through their ER. When I saw the insurance breakdown from my insurance company I noticed a level 5 consult from the specialist, which was fine. I audit outpatient charts all day so I can't help myself but follow the visit as an auditor as well as a parent and it truly was a level 5.  
Anyway, when I turned the page I saw a seperate E/M 99201 bill from the Hospital. I called the hospital for an explanation they said it was a "facility charge." I called the insurance carrier and they said it was an "acceptable charge at this time."  E/M codes like 99201-99205, 99211-99215 are for outpatient/office, Dr. codes only I explained. You need a billing DR number in order to charge for these codes.  
Can someone please tell me what happened here? I normally audit and code outpatient visits, not hospital, so am I missing something? It just doesn't seem right. 

phaliscakCPC


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## okiesawyers (Oct 24, 2008)

I am curious as to the answer to this question also as I only deal in outpatient auditing.  I want to bump the thread back up to get some fresh eyes to look at this again!  Can anyone help out?


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## FTessaBartels (Oct 24, 2008)

*Hospitals cannot use consult codes*

I'm NO expert on hospital coding; I code strictly for physicians, BUT ...

Our practice is entirely hospital based; we rent all our clinic and office space from the hospital. The hospital provides all the nurses, techs, equipment and supplies to the clinics. We bill (the doctors) only for the professional component. The hospital bills a facility charge.

I know there is a thread on the forum somewhere dealing with the fact that per CMS guidelines (probably Medicaid, too) hospitals are not able to use the consult codes at all.  As a result, they are probably coding based on new vs established (just a wild guess on my part). I don't have a clue as to how they determine the level of visit to charge. 

I *do* know that for every appointment with one of our physicians the patient (parent) receives a doctor's bill *AND* a hospital/facility bill. 

F Tessa Bartels, CPC, CPC-E/M


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## pamtienter (Oct 24, 2008)

I worked for a large commercial payer who wrote the facility's "provider-based facility charge" into the contract so it wasn't separately reimbursed if they billed it. It was billed as Rev code 0510 on the UB though. I wonder if this is a way around that? Curious. I don't do hospital coding either so would also be interested in hearing what others have to say about this.


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## smwermter (Oct 24, 2008)

I code for 5 hospital owned clinics and we are going live with our Provider Based Billing on Nov. 1.  I am the one who posted the thread earlier today about not coding consult E/M's on the facility side...just coding on new vs. established.  The facility level (99201-99205 or 99211-99215) is based off of a point system which is all determined by the nursing documentation form.  So in response, yes, it is completely valid for a 99245 physican consult level and a 99201 facility level.  Hope that helps.  I am definitly not an expert in this areas as I don't start to actually code these till Nov. 1.


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## magnolia1 (Oct 24, 2008)

O.K., I am by no means an expert when it comes to E/M coding. 

Have had very little experience with it (my forte' is Amb. Surg coding for facility).
However, this does not make any sense to me.

If, as in the scenario FTessaBartels describes, a physician or group is renting (meaning they pay to use that space), at a hospital, how can there not be an ethical issue with the hospital billing a facility charge to an insurance company/ patient in addition to what the physician who saw the patient would bill? Seems like double-dipping to me (??)

Karen Maloney, CPC
Data Quality Specialist


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## smwermter (Oct 24, 2008)

I don't know all the specifics of it, but I do know we had to get approval through CMS before we could begin charging the provider based facility charges.  There were lots of steps to go through before beginning and it has been in the work for months.  I have just been involved with a couple of the meetings that were specific to the actual coding...but I know there was a lot more that went into getting us ready to go live with it.  The clinics are all off campus but are owned by the hospital.  ED's have a professional and facility charge too...it is just like that.  The facility charge is the charge for the "resources" and the professional is for the physician's service.


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## magnolia1 (Oct 24, 2008)

Seeing that doctors (none that I've ever heard of) do not rent space in a Hospital Emergency Room, I can understand why there would be a professional and hospital component coded/ billed.

But, not when a physician is renting office space from a hospital. You refer to "resources". Am I wrong in thinking that these physicians do not hire their own staff, order and pay for their own supplies, etc??

Karen Maloney, CPC
Data Quality Specialist


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## Claudia Yoakum-Watson (Oct 24, 2008)

It is shocking to see two bills for a single E/M.  But it is appropriate for the facility to bill for the supplies, etc used for the E/M.  The reason is based on Relative Value Units (RVU).  When an E/M is provided in an office setting, the expenses (cost of supplies, nurse, etc) are included in the RVU for that E/M code.  When the same service is provided in a facility, the physician’s portion of the E/M does not include expenses and the physician is paid less than if the E/M was provided in an office setting. 

The facility is allowed to bill for the expenses (supplies, etc.)  Depending on the type of facility, they may bill as the CPT Code or as a Rev code.  I've provided the RVUs for a 99213 for illustration.  

	                    Facility	Non-Facility
Work	                        0.92	0.92
Expense (supplies,etc)       0.26	0.73
Mal Practice	           0.03	0.03
Total	                        1.21	1.68

You can see in the "Expense" portion the RVUs are less in the facility setting.
I hope this is helpful.


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## Claudia Yoakum-Watson (Oct 24, 2008)

OK, the RVU listing didn't post very well.  Let's see if this is better.


FACILITY
Work  0.92
*Expense 0.26*
Malpractice  0.03

NON FACILITY (office)
Work  0.92
*Expense 0.73*
Malpractice  0.03


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## smwermter (Oct 27, 2008)

I guess I should have clarified better...the physicians that I code for are employed by the hospital (just like the ED physicians) as is the rest of the staff..they do not rent from the hospital...the hospital ownes and operates all of the clinics that I code for.  Another thing I should have clarified is that not all payors recognize Provider Based.  Medicare, Medicaid and Medical Assistance are the main ones that DO recognize billing as a Provider Based clinic.   Maybe each state is different, that I'm not sure of.  Provider Based Billing is completely legitimate and is widely used.


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## FTessaBartels (Oct 28, 2008)

*Facility Charge*

Our hospital based providers "rent" space in hospital owned clinics / office buildings.

The *hospital hires *the *nurses*, lab techs, xray techs, etc, owns all the equipment, and provides virtually all the supplies. 

The physician bills ONLY for the professional component of his services. The hospital (facility) bills for the facility charge, which is based on the *nursing time* and *equiment/supplies used*. They use either new patient or established patient codes, as they are not allowed to use consultation codes. 

It's entirely possible (and in fact, likely), that a physician seeing a patient for a consultation might have spent 45 minutes and coded a 99244 visit, while the hospital facility charge is based on the nursing time of only 10 minutes and equates to a 99201. 

The physician is reimbursed at a lower rate because he is in a facility. The hospital is reimbursed for their costs associated with nursing. 

Even if the patient is in a global surgical post-op period for the physician follow-up visit (no charge by MD CPT 99024), the facility still charges for the nursing time and use of any supplies/equipment (e.g. re-casting for fractures). 

F Tessa Bartels


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