Updates aim to clarify longtime confusion. As you prepared for code changes in 2018, you knew about upcoming additions such as 0499T (Cystourethroscopy, with mechanical dilation and urethral therapeutic drug delivery for urethral stricture or stenosis, including fluoroscopy, when performed) and revisions to common procedures such as 57240 (Anterior colporrhaphy, repair of cystocele with or without repair of urethrocele, including cystourethroscopy, when performed). Now here's your rundown on small – but important – changes to four E/M observation codes that also went into effect Jan. 1, 2018. Pay Attention to 'Outpatient Hospital' Addition The code descriptor revisions are so small that they could be easy to overlook. But, the revision clarifies where these observation services should be rendered, points out Suzan Hauptman, MPM, CPC, CEMC, CEDC AAPC fellow, senior principal of ACE Med Group in Pittsburgh. You can see the change in the following E/M codes (underline represents language added to the descriptor): "These changes appear to be clearing up the confusion that often arises with observation patient status," says Barbara J. Cobuzzi, MBA, CPC, CENTC, COC, CPC-P, CPC-I, CPCO, AAPC Fellow, vice president at Stark Coding & Consulting LLC, in Shrewsbury, NJ. "Essentially, CPT® is clarifying that patients that are in observation are always in an outpatient status," Cobuzzi adds. Catch the Update in Introductory Comments You have to look closely to notice, but the preamble to the "Initial Observation Care, New and Established Patient" section of CPT® also has the words "outpatient hospital" inserted before the term "observation status." For example, the passages now states. "The following codes are used to report the encounter(s) by the supervising physician or other qualified health care professional with the patient when designated as outpatient hospital 'observation status.'" This verbiage indicates that observation services are only allowed in the outpatient hospital setting, whereas the presumption in the past was that observation was a "status" and not a defined place. The fact that observation status is now limited to the outpatient hospital setting could be a concern for surgeons depending on whether they're performing services at facilities deemed not to be outpatient hospitals. POS: Given the new restriction, the place of service for observation services should be outpatient hospital (22), not emergency department (23) or inpatient (24), says Glenn Littenberg MD, a physician in Pasadena, Calif.