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Multi-Day Observation Claims Don’t Have to Mean Rejections

Multi-Day Observation Claims Don’t Have to Mean Rejections

Confused about multi-day observations? Well, you’re not along. Multi-day observation medical billing claims can cause a lot of confusion. In order to get the correct reimbursements on your medical billing claims, you need to be sure that your multi-day observation billings are reported correctly – otherwise you’re practice isn’t receiving the maximum reimbursements for the services rendered and you’re in effect – losing money.

A main rule of thumb when doing medical billing for multi-day observation is to report per day of service. This means that if a patient is admitted late at night and isn’t discharged until the next morning, you report both service dates. The two current procedural terminology codes to use would be 99218-99220 for the initial observation evaluation. The other code you should use is 99217 (observation care discharge day management).

A common medical billing mistake that is made is to bill code 99234-99236 instead. This is incorrect because it means “observation or inpatient hospital care”. These medical billing codes includes the initial visit and the discharge costs. Reimbursement would be unfairly less then the services provided.

When using CPT code 99217 it is necessary to provide the necessary documentation to prove medical necessity. Documentation of an initial examination, hospital discussion with the patient, continued care instructions, and discharge preparation of records is required to validate the medical billing of the two CPT codes together. When billing Medicare for observation medical services you must know their rules. In order to report same day observation codes, the patient must be in the hospital for at least eight hours. Anything less does not warrant separate reimbursement. Usually private insurance payers are not this strict.

However, the best way is to record and submit the initial evaluation time and discharge time for medical billing purposes, this will ensure that you have your medical documentation right and the carrier should not have an issue reimbursing your practice for these services.

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