Initial Inpatient or Observation Care Services – CPT
At first glance, AMA CPT coding in 2023 seems simplified in the Hospital Setting. The distinct code set for Observation Services was deleted. The Initial Hospital Inpatient and Observation Care Services code sets merged into the 99221-99233 code set. The guidelines, however, have changed and application of the code set will depend on the patient’s “status”.
E/M Services Performed in Other Sites:
Here is the twist. In previous years, all services performed in other sites were bundled into the final destination hospital code. For example, if the patient was seen in the office and told to go to the hospital, their doc admitted them (same day), they would report only the Initial Inpatient Hospital service. In 2023, that’s now changed. Now, if you choose to report the E/M service, you can, with modifier -25 appended to the “other” E/M service code.
Consultative Services:
The catch, however, is if the initial inpatient service in the hospital is a consultative service, you will not be reporting 99221-99223, or an inpatient consultation code (99252-99255), you will instead report your consult with a SUBSEQUENT Hospital Visit Code, 99231-99233. This guidance pertains to the admitting physician (specialty/group practice).
This also holds true (according to AMA, page 23) “if a consultation is performed in anticipation of, or related to, an admission by another physician or other qualified health care professional, and then the same consultant performs an encounter once the patient is admitted by the other physician or other qualified health care professional. This also applies whether the consultation occurred on the date of the admission, or, a date previous to the admission. It also applies for consultations reported with any appropriate code (e.g. office or other outpatient visit or office or other outpatient consultation).”
Additionally, when reporting an initial hospital inpatient or observation care service, transition from observation level to inpatient, does not constitute a new stay.
Is there any GOOD news?
The good news is that the MDM and Time requirements are the same regardless of the patient’s “status” in the hospital (Initial Hospital Inpatient vs. Observation) when appropriately using the 99221-99233 code set.
I encourage everyone to read through the AMA definitions and guideline changes for 2023. More to come on this topic. CMS just released their CY23 final rule, and if you see Medicare patients, there is sure to be additional guidelines to layer on to this change. To get a sneak peek, turn to (page 504) to learn more about (3. Hospital Inpatient or Observation Care (CPT Codes 99218-99236). Stay tuned to the web site.
January 2023 Clarification: Although CPT combined Inpatient Care and Observation Service codes, the original place of service still stands:
- Inpatient Services: (POS 21)
- Observation Services: (POS 22)
If you would like additional training on these changes, please reach out to [email protected].