ED Coding and Reimbursement Alert

Read the rules carefully to determine which services are reportable and which are not without physician involvement.

It happens in most emergency departments: A patient comes in, is triaged and receives diagnostic testing such as a chest x-ray or an EKG, depending on their presenting symptoms, but leaves without ever having been seen by a physician. In such circumstances, can a hospital bill for the diagnostic test? 

The short answer: You can’t report a professional Evaluation and Management ( E/M) service, or a facility visit level service that would require an ED physician seeing the patient, but you can report the diagnostic tests on the facility side, says Candace Shaeffer, RN, MBA, RHIA, compliance officer with OptumInsight in Bellevue, WA. 

Diagnostic But Not Therapeutic Services Are Allowed

Background: In 2012, CMS indicated in a facility FAQ that hospital outpatient therapeutic services and supplies (including visits) must be furnished “incident to” a physician’s service and under the order of a physician or other qualified practitioner.  CMS stated that a facility ED E/M service would not be paid if the patient encounter did not meet the “incident to” requirement (the patient would need to be seen by an ED physician or non-physician practitioner).  Services provided by a nurse in response to a standing order also do not satisfy this requirement, says Shaeffer.  

Since diagnostic services do not need to meet the requirements for “incident to” services, they may be coded, even if the patient were to leave without being seen by the physician. The CMS language concerning not billing for a service when the patient didn’t see the physician all refer to therapeutic services; CMS specifically excludes diagnostic services when discussing outpatient service coverage, she adds. 

According to CMS regulations and guidance manuals, Chapter 15,“Covered Medical and Other Health Services, “Therapeutic services and supplies which hospitals provide on an outpatient basis are those services and supplies (including the use of hospital facilities) which are ‘incident to’ the services of physicians and practitioners in the treatment of patients. All hospital outpatient services that are not diagnostic are services that aid the physician or practitioner in the treatment of the patient. Such therapeutic services include clinic services, emergency room services, and observation services.” 

Know this nuance: The long-held tenet that “incident to” services don’t apply in the ED setting is correct, but keep in mind that those circumstances relate to physician’s billing for hospital provided resources, such as a nurse placing a Foley catheter. An ED physician could not bill for a nurse-placed Foley in the ED setting, but if it were in an office where the physician was directly responsible for the overhead and staffing costs, the “incident to” rules would allow the MD to bill for the service.  It is the hospital that is billing “incident to” the physicians order for services being provided, Shaeffer explains.

Services and supplies critical: Policies for hospital services “incident to” physicians’ services rendered to outpatients differ in some respects from policies that pertain to “incident to” services furnished in office and physician-directed clinic settings. To be covered as incident to physicians’ services, the services and supplies must be furnished by the hospital or CAH or under arrangement made by the hospital or CAH. The services and supplies must be furnished as an integral, although incidental, part of the physician or nonphysician practitioner’s professional service in the course of treatment of an illness or injury, warns Shaeffer. 

Don’t Report A Low Level Facility ED Visit, Either

Medicare had stated that a facility could charge and bill a low-level E/M code for those patients who have been triaged and leave the hospital without being seen by the physician. See below: 

Comment: Several commenters advised that a screening code was not necessary because an emergency visit code could be billed for ED screening services. 

Response: We agree with the commenters, and we will instead use the appropriate emergency department codes for screening services (as defined in section 1867[a] of the Act). If no treatment is furnished, we would expect screening to be billed with a low-level emergency department code.

Policy revision: It seems that CMS has changed its mind and issued the following new directive. In a Nov. 22, 2011 Hospital Open Door Forum, CMS representatives stated that a hospital may not bill Medicare for a low-level emergency department visit in instances where a patient receives only triage services from an ED nurse and elopes before being seen by a physician. Providers may bill Medicare for any diagnostic services furnished to the patient and also may bill the patient for the triage visit as a non-covered service for which the patient is liable, says Shaeffer.

The bottom line: CMS made clear that an ED visit is only billable if the patient is actually seen by a physician. Triage performed pursuant to a standing ED physician order is not billable if the patient does not see a physician. CMS personnel also rejected a questioner’s suggestion that a hospital could bill for the visit if the triage nurse conferred with a physician regarding the patient’s condition before the patient eloped. The key consideration, the participants stated, was whether the patient actually met with the physician, Shaeffer explains. 

No Can Do Without “Incident To”

Additionally, a CMS FAQ addresses the scenario of hospitals billing Medicare for the lowest facility level ED for patients who check into the ED and are triaged through a limited evaluation by a nurse but leave the ER before seeing a physician. 

CMS’ answer was that a low-level ED facility visit was not allowed because the limited service provided to such patients is not within a Medicare benefit category because it is not provided “incident to” a physician’s service. Hospital outpatient therapeutic services and supplies (including visits) must be furnished incident to a physician’s service and under the order of a physician or other practitioner practicing within the extent of the Act, the Code of Federal Regulations, and State law. Therapeutic services provided by a nurse in response to a standing order do not satisfy this requirement, says Shaeffer. 

Payer caveat: Commercial payers may have policies that vary from Medicare’s, so you want to check with the hospital’s key payers.  For Medicare, your best bet though is to contact the client’s Medicare contractor and get confirmation of their local payment policy, advises Shaeffer.