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POLICY

Observation care has become a growing trend in recent years as an alternative for patients who require services beyond the first hours in the emergency room, but do not need acute hospital care. In 1999, Blue Cross & Blue Shield of Mississippi (BCBSMS) implemented an observation policy that allows patients to remain in an "observation status" in the hospital up to 48 hours.

Current Procedural Terminology (CPT) provides codes to report evaluation and management (E/M) services provided to patients designated/admitted as "observation status" up to 24 hours. Codes are provided for the initial hospital care (99218-99220) and for observation care discharge (99217). However, under BCBSMS 48-hours observation policy, the observation care may span three calendar days. The attending physician may find it necessary to perform a follow-up evaluation and management (E/M) service on the second calendar day that the patient is in observation. If this occurs, BCBSMS will allow the physician to bill for the second calendar day by using the lowest level initial observation care E/M code, code 99218. The appropriate code from the initial observation care code range (99218-99220) should be used to report observation care services for the first calendar day that the patient is in observation. The observation care discharge code (99217) should be used to report observation discharge services.

When patients are admitted and discharged from an "observation status" on the same calendar day, use the appropriate code from code range 99234-99236 (observation or inpatient care services, including admission and discharge services).

See the CPT manual for coding rules for patients who are admitted to the hospital as an inpatient from an "observation status".

POLICY EXCEPTIONS

None

POLICY GUIDELINES

POLICY HISTORY

9/2011: Statement added, "This policy applies to services prior to January 1, 2011. Providers should be refer to the new subsequent observation care codes which became effective on January 1, 2011."

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