CurrentColorado Rocky Mountain Health PlansPolicy N/A

Hospital inpatient and observation care and discharge services reimbursement

Defines UnitedHealthcare Community Plan reimbursement rules for hospital inpatient and observation evaluation and management (E/M) services (initial, subsequent, admission/discharge same date, and discharge day management) billed on CMS-1500 or UB04 where specified for the Medicaid product.

Policy Summary

PayerColorado Rocky Mountain Health Plans

PolicyHospital inpatient and observation care and discharge services reimbursement

Policy CodePolicy N/A

Change TypeNo material change

Effective DateN/A

Next Review DateN/A

Key ActionInitial observation care must be billed only by the Admitting/Supervising Physician or QHP who ordered and was responsible for observation care.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

99221-99223Initial hospital inpatient or observation care CPT codes

99231-99233Subsequent hospital inpatient or observation care CPT codes

99234-99236Admission and discharge same date CPT codes

99238-99239Discharge day management CPT codes

One

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Only one discharge day management payable per patient per stay

Coverage and Documentation Requirements

Coverage criteria

Coverage and documentation requirements for billing inpatient and observation evaluation and management (E/M) services.

Initial hospital inpatient or observation care (CPT 99221-99223) must be billed only by the Admitting/Supervising Physician or Other QHP who ordered and was responsible for the patient during the observation care stay; a physician or QHP without inpatient admitting privileges but authorized to furnish hospital outpatient observation services may bill these codes.

When a patient is admitted to observation status for less than 8 hours on a calendar date, Initial Hospital Inpatient or Observation Care CPT codes (99221-99223) may be reported consistent with CMS guidance.

For same-day admission and discharge reporting, Hospital Inpatient or Observation Care (including admission and discharge) CPT codes 99234-99236 are reportable when the patient is in observation status for a minimum of 8 hours but less than 24 hours on the same calendar date.

ALL of the following

Documentation meeting E/M requirements for history, examination, and medical decision making.
Documentation stating the stay for hospital treatment or observation care involved 8 hours, but less than 24 hours (when reporting admission and discharge on same date).
Documentation identifying the Admitting/Supervising Physician or Other QHP was present and personally performed the services, and that the admission and discharge notes were written by the Admitting/Supervising Physician or Other QHP.

When a patient remains in observation for more than two calendar dates, subsequent hospital inpatient or observation care codes (CPT 99231-99233) should be used; these visits include review of records, diagnostic results, and changes since the last assessment.

Hospital inpatient or observation care codes are not separately reimbursable when performed within the assigned global period of a procedure or service; such services are included in the global package.

Duplicate or Repeat Services handling: when duplicate or repeat initial, subsequent, admission/discharge, or discharge services CPT codes are submitted for the same patient within the same stay by any Physician or QHP other than the Admitting/Supervising Physician or Other QHP, only one physician/QHP will be reimbursed.

Discharge day management (CPT 99238-99239): only one Hospital Inpatient or Observation Discharge Day Management service is payable per patient, per hospital stay; the service is reported only by the Admitting/Supervising Physician or Other QHP of record and includes the final examination, discussion of the stay, instructions for continuing care, and preparation of discharge records regardless of whether time spent is continuous.

Applicable CPT Codes and Time Thresholds

Hospital inpatient/observation E/M codesCPTCovered

99221-99223	Initial Hospital Inpatient or Observation Care
99231-99233	Subsequent Hospital Inpatient or Observation Care
99234-99236	Hospital Inpatient or Observation Care Services (including admission and discharge on the same date)
99238-99239	Hospital Inpatient or Observation Discharge Day Management

Minimum observation time for 99234-99236

RequirementMinimum observation time for reporting CPT codes 99234-99236 is at least 8 hours but less than 24 hours on the same calendar date.

Documentation neededMedical record must state the stay involved 8 hours but less than 24 hours of hospital treatment or observation care.

Provider presenceDocumentation must identify the Admitting/Supervising Physician or Other QHP was present and personally performed the services.

Minimum time for initial observation reporting if less than full day

Allowance for short staysInitial observation CPT codes (99221-99223) may be reported when a patient is admitted to observation status for less than 8 hours on a calendar date.

Billing restriction

Billing Responsibility and Reimbursement Limits

Billing Rule

Bill initial observation care only by the Admitting/Supervising Physician or Other QHP

Initial observation care CPT codes (99221-99223) may be reimbursed only when billed by the Admitting/Supervising Physician or Other QHP who ordered the observation services and was responsible for the patient during the observation stay; initial observation codes may be reported for patients admitted to observation status for less than 8 hours on a calendar date.

Admitting/Supervising Physician or Other QHP must have ordered the hospital outpatient observation services and been responsible for the patient during the observation stay.
Initial observation codes (99221-99223) are reportable for patients admitted to observation status for less than 8 hours on a calendar date.

Denial Risk

Only one provider reimbursed for duplicate/repeat inpatient/observation E/M codes

Key Definitions

Duplicate or Repeat Services

DefinitionDuplicate or Repeat Services are CPT codes for Initial or Subsequent Hospital Inpatient or Observation Care, Hospital Inpatient or Observation Care Services (including admission and discharge), or Hospital Inpatient or Observation Discharge Services submitted for the same patient within the same stay by any other Physician or QHP other than the Admitting/Supervising Physician or Other QHP.

ScopeIncludes initial, subsequent, admission/discharge, and discharge day management CPT codes when submitted by another practitioner for the same stay.

Reimbursement consequenceWhen such duplicate or repeat codes are submitted by other physicians/QHPs, only one physician/QHP will be reimbursed for the same patient and stay.

Admitting/Supervising Physician or Other QHP

DefinitionAdmitting/Supervising Physician or Other Qualified Health Care Professional (QHP) is the physician or QHP who ordered the hospital inpatient or observation care services and who was responsible for the patient during the observation care stay.

Policy Summary

PayerColorado Rocky Mountain Health Plans

PolicyHospital inpatient and observation care and discharge services reimbursement

Policy CodePolicy N/A

Change TypeNo material change

Effective DateN/A

Next Review DateN/A

Key ActionInitial observation care must be billed only by the Admitting/Supervising Physician or QHP who ordered and was responsible for observation care.

SourceLink

On This Page

Initial observation codes must be billed only by the Admitting/Supervising Physician or Other QHP who ordered and was responsible for the patient during the observation stay.

DocumentationMedical record should include dated and timed orders detailing the observation services and assessment of patient risk for observation care.

When duplicate or repeat inpatient/observation E/M CPT codes are submitted for the same patient within the same stay by any other Physician or QHP (other than the Admitting/Supervising Physician or Other QHP), only one Physician or QHP will be reimbursed.

Duplicate or repeat services include initial, subsequent, admission/discharge, or discharge services submitted for the same patient within the same stay by another Physician or QHP.

Billing Rule

Limit one discharge day management (99238/99239) per stay; report by Admitting/Supervising Physician/QHP

Only one Hospital Inpatient or Observation Discharge Day Management service (CPT 99238 or 99239) is payable per patient per hospital stay and must be reported by the Admitting/Supervising Physician or Other QHP of record.

Discharge day management codes report the total duration of face-to-face time by the Admitting/Supervising Physician or Other QHP for final discharge activities.
Other physicians/QHPs should use subsequent care codes (99231-99233) for their final visit if they are not the Admitting/Supervising Physician/QHP of record.

Billing roleThis Admitting/Supervising Physician or Other QHP is the authorized provider to report Initial Hospital Inpatient or Observation Care CPT codes.

ResponsibilityMust document dated and timed orders, assessment of patient risk for observation care, and signed nursing/progress notes during the observation stay.

Observation Care

DefinitionObservation Care comprises evaluation and management services provided to patients designated as 'observation status' in a hospital, including initiation/supervision of the observation care plan and periodic reassessments.

LocationPatient need not be physically located in a designated observation area; 'observation status' refers to initiation of observation care, not a specific facility area.

ReportingInitial observation services are reported only by the Admitting/Supervising Physician or Other QHP and should incorporate E/M services performed in other sites of service on the same day related to the observation admission.