Are observation codes submitted by the hour or by the calendar date?

Answer:
Payment for an initial observation care code is for all the care rendered by the ordering physician on the date the patient’s observation services began.

Payment for a subsequent observation care code is for all the care rendered by the treating physician on the day(s) other than the initial or discharge date.

Observation Codes Scenarios:
Reporting Requirements:
Observation Care for less than eight hours on the same calendar date
  • Report an initial observation, CPT code from code range 99218-99220
  • Observation care discharge service, CPT code 99217 cannot be reported
Admission for observation care followed by discharge on a different calendar date
  • Report an initial observation, CPT code from code range 99218-99220 along with,
  • Observation care discharge service, CPT code 99217
Observation care continues for three days
  • Report an initial observation care CPT code from code range 99218-99220 for the first day of observation care,
  • Report a subsequent observation care CPT code from code range 99224-99226 for the second day of observation care, and
  • Report observation care discharge CPT code 99217 for observation care on the discharge date
Observation care continues beyond 3 days
  • Report a subsequent observation care CPT code (99224-99226) for each day between the first day of observation care and the discharge date
Observation care is received for a minimum 8 hours, but less than 24 hours, and discharge occurs on the same calendar date
  • Report an observation or inpatient care services (including admission and discharge services) from CPT code range 99234-99236
  • Observation care discharge service, CPT code 99217 cannot be reported

Resource

Contact Railroad Medicare

Email Railroad Medicare

Contact a specific Railroad Medicare department

Provider Contact Center: 888-355-9165

IVR: 877-288-7600

TTY: 877-715-6397

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