Oncology & Hematology Coding Alert

CPT^® extends MDM elements across more E/M codes.

CPT^® 2023 features a huge shakeup in the hospital inpatient or observation care evaluation and management (E/M) services. Not only will you have to change the way you report observation care, but you’ll also have to apply the medical decision making (MDM) elements CPT^® introduced in 2021 for the office/outpatient evaluation and management (E/M) services along with new time parameters to determine the appropriate service levels for observation care, hospital admissions, and same-day observation and discharges.

Here’s what you need to know.

Erase These Observation Care Codes

Effective Jan. 1, 2023, you will no longer be able to report 99218-99220 (Initial observation care, per day, for the evaluation and management of a patient …), which you currently use to report initial outpatient hospital observation services; 99224-99226 (Subsequent observation care, per day, for the evaluation and management of a patient …), which you currently use to report subsequent outpatient hospital observation services; or 99217 (Observation care discharge day management …), which you currently use to report “all services provided to a patient on discharge from outpatient hospital ‘observation status’ if the discharge is on other than the initial date of ‘observation status’” per the soon-to-be-deleted codes and their descriptors.

Report 2023 Observation, Admissions, and Same-Day Discharges Like This

Instead, you will use one of the following existing hospital care codes, which have received extensive descriptor revisions:

• 99221 (Initial hospital inpatient or observation care, per day, for the evaluation and management of a patient, which requires a medically appropriate history and/or examination and straightforward or low level medical decision making. When using total time on the date of the encounter for code selection, 40 minutes must be met or exceeded)
• 99222 (… moderate level of medical decision making … 55 minutes must be met or exceeded)
• 99223 (… high level of medical decision making … 75 minutes must be met or exceeded)
• 99231 (Subsequent hospital inpatient or observation care, per day … which requires a … straightforward or low level of medical decision making. When using total time … 25 minutes must be met or exceeded)
• 99232 (… moderate level of medical decision making … 35 minutes must be met or exceeded)
• 99233 (… high level of medical decision making … 50 minutes must be met or exceeded)
• 99234 (Hospital inpatient or observation care… including admission and discharge on the same date, … straight­forward or low level of medical decision making … 45 minutes must be met or exceeded)
• 99235 (… moderate level of medical decision making … 70 minutes must be met or exceeded)
• 99236 (… high level of medical decision making … 85 minutes must be met or exceeded)

You’ll notice CPT^® has brought the code descriptors in line with the current office/outpatient E/M service codes. This means you will be using the same MDM elements to determine service level.

Additionally, “the new time guidelines for the observation care, hospital admission and same-day discharges are the same as those CPT^® introduced in 2021 for the office/outpatient E/M services, though the listed times for the new codes are different and must be met or exceeded rather than being time ranges,” notes Leah Fuller, CPC, COC, senior consultant, Pinnacle Enterprise Risk Consulting Services, in Charlotte, North Carolina.

“CPT^® also indicated that these time parameters include time on or off the inpatient unit or in or out of the outpatient office,” Fuller adds. CPT^® has also added a new guideline stating, “When using MDM or total time for code selection, a continuous service that spans the transition of two calendar dates is a single service and is reported on one calendar date. If the service is continuous before and through midnight, all the time may be applied to the reported date of the service.”

Applying the Inpatient/Observation Codes Correctly

As you have in the past, you’ll report initial service codes 99221-99223 for the first hospital inpatient or observation status encounter with the patient, and if the following occur:

• “The patient has not received any professional services from the physician or other qualified health care professional or another physician or other qualified health care professional [QHP] of the exact same specialty and subspecialty who belongs to the same group practice [this includes advanced practice nurses and physician assistants working with the physician or QHP] during the stay” per CPT^® guidelines, and
• The patient’s admission and discharge do not occur on the same day. “However, if the patient is admitted and discharged at the same encounter (one visit), an initial service code is appropriate” says Fuller.

If the patient has received services during the stay from the physician or other QHP of the exact same specialty and subspecialty and in the same practice, then you’ll use subsequent service codes 99231-99233. For patient admission and discharge on the same day, you’ll use 99234-99236, which require two or more encounters (at least an admission encounter and a discharge encounter) on the same date. And for discharges on a day other than the day of admission, you’ll continue to use 99238 (Hospital inpatient or observation discharge day management; 30 minutes or less on the date of the encounter) and 99239 (… more than 30 minutes on the date of the encounter). Only the physician or other QHP responsible for discharge services should use 99238 and 99239; you should report other medically necessary services, including coordinating post-discharge services and instructions to the patient and/or family/caregiver, by other physicians or other QHPs with 99231, 99232, or 99233.

And remember: You should regard a patient transition from observation to inpatient as a single stay. CPT^® 2023 also makes it clear that, for all these codes, “the problem addressed is the problem status on the date of the encounter, which may be significantly different than on admission,” and “may not be the cause of admission or continued stay.” Last, you will still report admissions for patients 28 days of age or younger with 99477 (Initial hospital care, per day, for the evaluation and management of the neonate …).

Watch Out for Incoming Associated Prolonged Service Codes

As the codes are time-based, CPT^® is planning to introduce three more new prolonged service codes, which you will use when the initial hospital inpatient or observation care service exceeds 90 minutes, the subsequent hospital inpatient or observation care service exceeds 65 minutes, and the same-date admission and discharge service exceeds 100 minutes.

For the full list of 2023 E/M code and guideline revisions, go to https://www.ama-assn.org/system/files/2023-e-m-descriptors-guidelines.pdf.