Effective April 1, CMS began paying hospitals for observation services for Medicare patients with diagnosis of chest pain, asthma, or congestive heart failure (CHF).
When it is determined that patients with any of these diagnoses can be evaluated/treated within 24 hours with expected rapid improvement of the patient’s condition, observation status is appropriate and the hospital will receive additional payment.
In order for that payment to be made the following criteria must be met:- An Evaluation and Management service must be billed by the physician the day before or day of observation;
- Observation is paid for a minimum of 8 hours and a maximum of 24 hours, as recorded by hospital systems;
- Observation time begins at the clock time appearing on the nurse's observation admission note;
- Observation time ends at the clock time documented in the physician's discharge orders, or, in the absence of such a documented time, the clock time when the nurse or other appropriate person signs off on the physician's discharge order;
- The patient must be under the care of a physician during the period of observation, as documented in the medical record by admission, discharge, and other appropriate progress notes, timed, written, and signed by the physician; and
In order to bill observation services, certain diagnostic tests and services must be provided, based on diagnosis, to assure that the beneficiary is being evaluated, as noted below:- Chest Pain – At least 2 Cardiac Enzyme (CPK or Troponin), 2 Sequential EKG’s
- Asthma – Peak Expiratory Flow Rate (PEFR) or Pulse Oximetry and Nebulizer treatments
- Congestive Heart Failure - Chest X-Ray, EKG, and Pulse Oximetry
The basic principles of Admit to Observation have not changed. These are as follows:
A physician order to ATO is necessary. An order that simply states “admit” will be treated as an inpatient admission. A clearly written order such as “observation admission” or “place patient in outpatient observation” will ensure appropriate classification and payment as observation. Comprehensive history and physical exam. Observation ends when the physician discharges the patient or when the patient is admitted to inpatient status if clinical problems cannot be resolved within 24 hours. Documentation must address problems identified in the H&P, treatment initiated, patient’s response to treatment, major changes in patient’s condition and action taken, status of unresolved problems, discharge planning and follow-up.Attention to these details when making decisions to Admit to Observe will enhance BWH’s ability to be properly compensated for its services.
If you have any questions contact:
Neil Walsh in the Billing Compliance Department at 617-732-9377 or Andy Sussman, MD at ext.2-6240.