EM Coding Alert

Is it an observation, consultation, or an office visit? Refresh your E/M coding skills for inpatients.

Evaluation and management (E/M) coding in the hospital setting continues to challenge even experienced coders because observation services, inpatient admissions, consultations, and office visits may look nearly identical in a patient’s medical record. When coders select from the wrong E/M code set, it can lead to denials.

Instead of focusing on the patient’s physical location at the hospital, coders should consider the patient’s official status, the provider’s role, and the intent of the encounter documented in the medical record to select the correct E/M code set. Refresh your knowledge on how these key elements interact to perfect your E/M coding skills.

Start With Patient Status: Observation vs. Inpatient

Start with confirming the patient’s status at the time of service; this is the first and most critical step in the E/M code selection process. Medicare and most commercial payers label observation services as outpatient care, even for patients physically located inside the hospital.

If the patient’s medical record and the payer’s policy support office/outpatient E/M reporting rather than observation-specific codes, use the 99202-99215 (Office or other outpatient visit …) code set.

Inpatient status begins only when a provider writes a formal inpatient admission order. After that, coders should no longer use observation codes and opt for inpatient E/M codes even if the patient is discharged on the same day. Select the most appropriate code from the following:

• 99221-99223 (Initial hospital inpatient or observation care …)
• 99231-99233 (Subsequent hospital inpatient or observation care …)
• 99234-99236 (Hospital inpatient or observation care, for the evaluation and management of a patient including admission and discharge on the same date …)
• 99238-99239 (Hospital inpatient or observation discharge day management)

When coders infer status from unit names or bed assignments instead of reviewing the admission order, they may select an erroneous code. To avoid this, always verify the order and its timestamp. If the patient’s status changes during the encounter, align E/M selection with the patient’s status at the time the provider delivered the service.

Know When to Apply Consultation Codes

Coders should define a consultation based on whether the provider delivers an opinion and returns care to the requesting provider, not based on the complexity of the work. To report a consult, another provider or qualified healthcare professional must document a request for an opinion or advice related to a specific clinical question.

For example, a hospitalist requests that a cardiologist evaluate a patient’s abnormal echocardiogram (EKG) and provide recommendations for management and documents this request in the patient’s medical record. The cardiologist reviews the EKG, examines the patient, documents findings and treatment recommendations, and returns care to the hospitalist. This qualifies as a consultation, even if the evaluation is relatively straightforward.

However, if a cardiologist sees a patient with the same abnormal EKG but assumes ongoing management of the cardiac condition, writes daily progress notes, and adjusts medications, this does not qualify as a consultation even if the work is complex, because the cardiologist has taken over care.

Medicare no longer recognizes the following consultation code sets:

• 99242-99245 (Office or other outpatient consultation …)
• 99252-99255 (Inpatient or observation consultation for a new or established patient …)

Instead, Medicare requires providers to report initial or subsequent hospital care. Some commercial payers do continue to allow consult codes, so it is critical that coders review each payer’s policy.

Avoid treating standing orders as consult requests or allowing multiple specialities to bill consultations without documented requests. When the documentation does not clearly support all consultation criteria, use inpatient E/M codes.

Know When to Use Outpatient E/M Codes in the Hospital Setting

As mentioned previously, office or other outpatient E/M codes can apply even when a patient is physically located in a hospital. Report these codes when the patient remains in outpatient or observation status and the provider does not bill inpatient or observation E/M services for the same encounter.

This is often relevant in hospital-based clinics or provider-based departments where patients receive outpatient services before admission. In these situations, the documentation in the patient’s medical record must clearly support outpatient status.

Do not report office E/M codes separately when the same provider admits the patient to inpatient or observation status on the same date and the visit is integral to the admission decision. Coders must review whether the service stands alone or forms part of the admission process before selecting the E/M code.

For example, a hospitalist evaluates a patient in a hospital-based outpatient clinic for worsening shortness of breath and the hospitalist reviews labs, performs an exam, and determines that the patient requires hospital-level care during the visit. The same hospitalist then writes an order to admit the patient to observation or inpatient status later that day.

Although the initial encounter occurred in an outpatient clinic and meets the documentation requirements for an office E/M visit, the service is integral to the admission decision. Because the same provider performed both the evaluation and the admission on the same date, the coder should use only the appropriate initial observation or inpatient E/M code, not a separate office E/M code.

Let’s review an example of when coders should report an office E/M code separately. If a primary care physician evaluates a patient in a hospital-based clinic for abdominal pain and recommends emergency department (ED) evaluation, but does not admit the patient, and later that day a different provider admits the patient to observation status, the coder should use a separate office E/M code.

Review Your Decision-Making Process for E/M Codes

Ask yourself these questions to help take the guesswork out of E/M coding:

• What was the patient’s official status at the time of service?
• Did the provider assume ongoing management of the patient?
• What does the payer allow for this scenario?

Correct distinctions between observation, consultation, and office or inpatient E/M services are the key to selecting the correct codes. Focus on patient status, provider role, and documented intent rather than the patient’s physical location. Instead of guessing and potentially selecting an inappropriate code, you should ask providers follow-up questions if a patient’s documentation is unclear.

Michelle Falci, BA, M Falci Communications LLC