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Observation vs. outpatient physician billing in hospital setting

Best answers
I do billing for a group of hospital based physicians (hospitalists). We have one facility that is notorious for having patients admitted under "extended hospital outpatient" status. Most often these are placement issues - not accepted by SNF, not appropriate for rehab, no family to care for them, etc. Oftentimes the patients start out as inpatient, but then outpatient orders (NOT observation) are dropped as the patient no longer meets inpatient criteria.

We have had a very difficult time finding clear documentation on how to bill these services. Initially we thought that the claims would be billed as observation follow up's (99224-99226); however, the more we are looking into this, it seems as though we should be billing 99212-99214. Does anyone have resources regarding this situation (especially for Medicare patients)?

Thank you! :D

Pam Brooks

True Blue
Local Chapter Officer
Dover Seacoast New Hampshire
Best answers
EXT (Extended Care) is an outpatient status, not an Observation status, and thus you would use the 99212-99215 code sets. The Observation codes in CPT are specifically for patients admitted to observation, which is a different level of care than EXT. I don't have any resources right off the top of my head, but know this from the perspective of patient care in the facility. I'll look around, though.