ED Coding and Reimbursement Alert

Avoid these common pitfalls to drop problem-free 99218 claims

Even though you know the general rules for reporting observation services in the ED, certain coding mistakes show up more often than you think. Read this to be sure your practice isn't falling prey to observation mishaps.

1. Dismiss location

Billing observation services doesn't rely on where the physician performed them. Observation is a type of service, not necessarily a physical place within the emergency department where the patient stays.

2. Make sure the physician provides the order

Check the patient's medical record to ensure the physician leaves an indication that he ordered the patient into observation status. You-ll need a time note from the doctor, as well as the nurse's time note.

3. Avoid using observation as a holding space

The purpose behind observation status is to determine the patient's need for admission, so don't use 99218-99220 (Initial observation care) when observation isn't medically indicated. Remember: The physician needs to order observation prospectively, not retroactively--don't just call a service observation because you have a chunk of care time without a home.

4. Don't bill a related E/M code and an observation code for the same encounter

Since you can't report them together, you have to choose between them. Either report an upper-level E/M code, such as 99284 (Emergency department visit for the evaluation and management of a patient, which requires these three key components: a detailed history, a detailed examination, and medical decision-making of moderate complexity) or 99285 (-within the constraints imposed by the urgency of the patient's clinical condition and/or mental status: a comprehensive history, a comprehensive examination, and medical decision-making of high complexity), or opt for an observation code instead. You can, however, bill for additional procedures or diagnostic test alongside observation codes.

5. Observation histories and exams require more than the corresponding ED E/M code

For example, a -comprehensive- observation history requires you to list three out of three elements for the patient's past/family/social history, whereas the ED E/M codes (99281-99285) only ask you for two of three. For all of the observation codes, you-re looking at either detailed or comprehensive physical examinations.

6. Don't skimp on time documentation

To bill 99234-99236 (Observation or inpatient hospital care), the doctor must have documentation that  satisfies the requirements for both admission to and discharge from inpatient or observation care. Make sure the physician includes the following: length of time for treatment status, timed nursing notes, and timed physician notes.

You need to see evidence in the medical record of every time the physician talked to the patient, observed him, checked on his condition, re-examined him, or looked at diagnostic tests.

7. Bill only once for same-group physicians

If two physicians in the same group practice both provided observation care to the same patient, you shouldn't report it twice. Trouble: You can't bill an ED E/M service for Physician A and observation for Physician B, either. You-ll just have to choose one.

Tips provided by Caral Edelberg, CPC, CCS-P,  president and chief executive officer of Medical Management Resources Inc. in Jacksonville, Fla.