Observation Room Services

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Observation Room Services

• Empire Medicare Services
• Provider Outreach Education

EMPIRE MEDICARE SERVICES A Division of Empire
HealthChoice Assurance, Inc., a CMS-Contracted
Agent http//www.empiremedicare.com
http//www.cms.hhs.gov
PET1108 (11/06)
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Objective

• To give a basic understanding of the coverage and
  billing guidelines for observation room services

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Acronyms
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Agenda

• Observation services - defined
• Observation time
• Observation coverage documentation
• Observation billing
• Direct admission to observation
• Separate APC payment for observation
• Observation services not covered

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Observation Services - Defined

• Observation care is a well-defined set of
  specific clinically appropriate services that
  include
• Ongoing short-term treatment
• Assessment and reassessments performed before a
  decision can be made regarding whether to admit
  or discharge the beneficiary

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Observation Time

• Begins at time placed in observation bed
• Ends when beneficiary is admitted or discharged
• All clinical or medical interventions have been
  completed
• Admitted as an inpatient
• Discharged from hospital
• Including follow-up care furnished by hospital
• Observation time may include medically necessary
  services and follow-up care
• Before discharge

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Coverage Documentation
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Coverage Criteria

• Beneficiary must be under care of a physician
  during period of observation
• Documented in medical record by admission,
  discharge, and progress notes
• Timed, written, and signed by a physician

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Medical Record Documentation

• Should include
• Physicians order admitting patient to
  observation
• Initial evaluation/reevaluation
• Observation room notes
• Lab reports
• X-ray reports
• Medication sheet
• Coverable diagnosis

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Medical Record Documentation(cont.)

• Should also include
• Admission note
• Patient status should reflect
• Improvement
• Decline
• Release/discharge note
• Admission to inpatient
• If applicable
• Admission/discharge time

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Billing Requirements
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Billing Requirements
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HCPCS Code G0378

• OPPS will determine whether G0378 is separately
  payable
• APC 0339 or
• A packaged service
• Hospitals bill HCPCS code G0378 for any
  beneficiary in observation status
• Regardless of condition

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HCPCS Code G0379

• When observation services are result of a direct
  admission to observation status
• Report G0379
• Without an associated ER visit
• Hospital outpatient clinic visit or
• Critical care service
• When beneficiary is admitted directly to
  observation care by a physician
• Report G0379

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Direct Admission to Observation

• To receive separate payment, claim must show
• HCPCS codes G0378 and G0379 with same date of
  service,
• No services with status indicators T or V (or
  critical care (APC 0620)) provided on same day as
  HCPCS code G0379, and
• Observation care does not qualify for separate
  payment under APC 0339.

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Observation services

• Separate payment may be made for
• Congestive heart failure
• Chest pain, or
• Asthma

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Observation services (cont.)

• ICD-9-CM diagnosis codes eligible for separate
  payment reviewed annually
• List of qualifying ICD-9-CM diagnosis codes
  published on OPPS Web page
• www.cms.hhs.gov/IdentifiableDataFiles/03_Hospital
  OPPS.asp

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Separate APC Payment for Observation Services

• All of following requirements must be met
• Diagnosis requirements
• Beneficiary must have one of three medical
  conditions
• Congestive heart failure
• Chest pain, or
• Asthma
• Enter diagnosis in either admitting or primary
  diagnosis field(s)
• Or both

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Separate APC Payment for Observation Services

• Observation time
• Documented in medical record
• Observation time begins with admission to
  observation bed
• Observation time ends when all clinical or
  medical interventions are complete
• Including follow-up care
• Number of units for G0378 must equal or exceed
  eight hours

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Separate APC Payment for Observation Services
(cont.)

• Additional hospital services
• Emergency department visit (APC 0610, 0611,
  0612), or
• Clinic visit (APC 0600, 0601 or 0602), or
• Critical care (APC 0620), or
• Direct admission to observation reported with
  G0379 (APC 0600)
• No T status indicator reported on same day or
  day before observation care

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Separate APC Payment for Observation Services
(cont.)

• Physician evaluation
• Beneficiary must be under care of a physician
• Medical record must include documentation that
  physician explicitly assessed patient risk
• To determine beneficiary would benefit from
  observation care

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Separate APC Payment for Observation Services
(cont.)

• Bill all other services associated with
  observation care on same claim
• Direct admission to observation
• Hospital clinic visits
• Emergency room visits, critical care, and T
  status procedures
• If observation care does not meet all
  requirements, then its a packaged service

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Observation Services Not Covered

• Services not reasonable and necessary for
  diagnosis or treatment
• Services provided for convenience of patient,
  patient's family, or doctor
• For example, following an uncomplicated treatment
  or procedure

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Observation Services Not Separately Payable

• Services covered under Part A inpatient stay
• Such as medically appropriate inpatient admission
• Services part of another Part B service
• For example, postoperative monitoring during a
  standard recovery period
• Standing orders for observation following
  outpatient surgery

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Observation Services Not Covered (cont.)

• If all noncovered services
• Submit claim with condition code 21
• ABN should not be issued for reasonable and
  necessary observation services
• Do not confuse a packaged payment with noncoverage

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References

• Observation Billing PUB 100-4, Chapter 4,
  Section 290
• Observation Coverage PUB 100-2, Chapter 6,
  Section 20.5

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National Provider Identifier (NPI)

• Providers required by law to apply for NPI
• Include your legacy identifiers when applying
• Must have by 05/23/2007
• CMS page for NPI news and educational products
  (articles, fact sheets and NPI viewlet)
• http//www.cms.hhs.gov/NationalProvidentStand/
• Online NPI application tool
• https//nppes.cms.hhs.gov
• To request paper application
• Call 1-800-465-3203

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Provider Inquiries
Written Inquiries 400 S. Salina St. Syracuse, NY
13202 Attn Provider Inquiries

• Call Center Inquiries
• 1 [phone]
• TTY Inquiries
• 1 [phone]
• Automated Inquiries
• 1 [phone]
• Email Inquiries
• partaprovider_at_empireblue.com

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