Gastroenterology Coding Alert

Question: Usually after an endoscopic retrograde cholangiopancreatography, our gastroenterologists will keep a patient in observation for 12 to 24 hours but not bill for their services during this time. However, we may keep the patient  for as long as 48 hours after the ERCP and are not sure how to report for those extended stays. In some cases, the patient may end up being admitted to the hospital. How should we report these E/M services?

New Jersey Subscriber
 
Answer: Medicare and CPT disagree somewhat on which codes to use when a patient is admitted to observation. Medicare revised its national policy for observation care codes and published the changes in the Nov. 1, 2000, edition of the Federal Register:
 

When a patient is admitted for observation care for more than eight hours and is discharged on the same calendar day, 99234-99236 (observation or inpatient hospital care) should be reported.
 

When a patient is admitted for observation care for less than eight hours and is then discharged on the same calendar day, 99218-99220 should be used to report the admission, and no discharge code should be reported.
 

When a patient is admitted for observation care and discharged on a different calendar day, 99218-99220 (initial observation care) should be used to report the admission and 99217 (observation care discharge) to report the discharge.

 
If the patient is held in observation for more than two calendar days, Medicare's national policy states that any E/M services provided after the day of admission and before the day of discharge should be reported using the outpatient/office visit codes (99211-99215). The time is based on when the patient is admitted to observation, not when the procedure was completed. A day is defined as a calendar day. A patient could be admitted to observation at 11:30 p.m. on Monday and discharged at 6:30 a.m. on Tuesday -- that would qualify as an admission on one calendar day and a discharge on a different day even though the patient had been in observation for only seven hours.
 
CPT guidelines on observation care allow gastroenterologists to bill the higher-paying observation care code (99234-99236) whenever a patient is admitted and discharged from observation on the same day and not just when the patient has been there for over eight hours. Many private payers who follow CPT, as well as local Medicare carriers who opt not to follow the national policy, may be using this guideline.
 
Medicare revised its national policy on inpatient admissions to the following:
 

When a patient is admitted to inpatient hospital care for more than eight hours and is then discharged on the same day, 99234-99236 should be reported.
 

When a patient is admitted to inpatient hospital care for less than eight hours and is then discharged on the same day, 99221-99223 (initial hospital care) should be used to report the admission, and no discharge code should be reported.
 

When a patient is admitted to inpatient hospital care and discharged on a different date, 99221-99223 should be used to report the admission, and 99238-99239 (hospital discharge) to report the discharge.

 
If a patient is admitted to inpatient status on the same day that he or she was admitted to observation, Medicare and CPT agree that only the appropriate inpatient hospital code can be reported. An observation care discharge code (99217) or an outpatient/office visit (99211-99215) cannot be reported on the date of admission to inpatient status.
 
Finally, 24 hours in observation is along time to wait before reporting an admission, and you may want to consider changing your billing policy. Although you must include postoperative recovery time in the global surgical package, three to six hours is probably considered a reasonable amount of recovery time. It is likely that a patient who is still in observation after six hours has signs of complications and is receiving significant and separately identifiable services from the gastroenterologist that should be reported separately.
 
To bill an observation admission that occurs on the same day as the ERCP (or any procedure), modifier -25 (significant, separately identifiable evaluation and management service by the same physician on the same day of the procedure or other service) should be attached to the E/M code. It is inappropriate to bill for an E/M service when the patient was simply present in an observation unit and no additional service was documented in the record beyond the standard postprocedure orders, and the physician did not see the patient prior to discharge.

 
-- Reader Questions and You Be the Coder answered by Pat Stout, CMC, CPT, an independent gastroenterology coding consultant and president of One Source, a medical billing company in Knoxville, Tenn.