Pediatric Coding Alert

Question: One of our pediatricians performed an observation service for a patient that lasted a very long time. The patient reported to the hospital at 9 a.m. Tuesday with a diabetic seizure. After being in observation for most of the day, the physician discharged the patient at 11:13 p.m. Tuesday. Notes indicate a level-three observation service. How many codes should I report for this service?

Codify Subscriber

Answer: You’ll only be able to report a single observation code for this service, if it is a payer that follows Medicare coding rules. On the claim, report 99236 (Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date, which requires these 3 key components: a comprehensive history; a comprehensive examination; and medical decision making of high complexity) for the encounter. These codes are based on service and, although there is a time factor involved, you cannot bill more of the same code based on the added time. There are prolonged service codes that could be considered if appropriate (see 99354-99357).

Explanation: For most insurers, including those who follow Medicare’s rules, you’ll pick from the 99234-99236 code set if the observation lasts more than eight hours on a single calendar day.

Exception: For observations that last less than eight hours on a single calendar day, Medicare wants you to report the appropriate code from the 99218-99220 (Initial observation care, per day, for the evaluation and management of a patient which requires these 3 key components: …) code set.

Also, you should choose from 99218-99220 when a patient is in observation care for less than eight hours on the same calendar date for payers that follow Medicare rules.

Because you are most likely dealing with a private payer and not Medicare, make sure to check their policies before reporting a 99218-99220 for a single-day observation of less than eight hours. Some payers might prefer you use 99234-99236.