ED Coding and Reimbursement Alert

Answer 'where, when, why and who' to nail down payment

The rules for reporting observation by ED physicians are full of complicated do's and dont's, but you can cut down the confusion by knowing four key pieces of information - the time of discharge, the patient's physical whereabouts, the reason for observation, and the doctor in charge.

Time Is of the Essence

 The first thing you'll need to know to choose the right observation code is when the patient was discharged, because that's primarily how these codes are distinguished, says James Blakeman, vice president of Emergency Groups' Office in Arcadia, Calif.
 
If the physician admitted and discharged the patient on the same day, you should apply 99234-99236 (Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date), Blakeman says. If the patient is discharged the day after admission, you'll report 99218-99220 (Initial observation care, per day, for the evaluation and management of a patient) for services on the admission date and 99217 (Observation care discharge day management) for the discharge date.
 
Key: Identify the insurer reimbursing the claim, because Medicare and private carriers have different requirements on timing in observation. "Medicare does not want the 'same-day discharge' codes to be used for observation stays of less than eight hours, but makes no time requirement for the 'different-day' series," Blakeman says.
 
If you're billing a private carrier, you're free from any minimum or maximum time periods, says Robert Kottman, MD, FACEP, emergency physician at Baptist Health System in San Antonio, and member of the coding and nomenclature advisory committee for the American College of Emergency Physicians (ACEP).
 
Fight these denials: Make sure you have the documentation to support your physician's work. This should include the following, says Kottman, who presented on observation coding at a recent ACEP reimbursement meeting:
  time the physician admitted and discharged the patient from observation status
  reason for admission to observation
  time the nurse signs off on physician's discharge orders
  physician's progress notes, complete with time, handwriting, and signature
  discharge instructions, such as medications, follow-ups with primary-care providers, or communication regarding new problems or complications.

Do You Know Where Your Patient Is?

Don't be fooled: Just because the observation isn't physically taking place in an ED bed doesn't mean you can't bill for ED physician services. The doctor can provide observation services in any bed in any area of the hospital, Kottman says. Keep in mind, though, that if the doctor supervising the observation provided evaluation and management services to that patient on the same day he admitted her to observation, you can't separately bill for both - no matter where the physician provided them. These E/M services count as part of the initial observation care, Kottman says.

Steer Clear of These Pitfalls

The ED physician can admit a patient to observation for any diagnosis or condition, but that doesn't mean anything goes. You should use observation purely to decide whether the patient needs admission, Kottman says.
 
Don't fall into any of these common traps by placing these people in observation care:

  admitted patients waiting for free inpatient beds
  ED patients who need prolonged treatment before they go home, such as intravenous fluids
  "dumped" patients - for example, a relative whose family won't pick him up, or a psych patient who can't be committed until the weekend is over.