Some interesting replies in this thread.
The OP is correct, what is being asked is sketchy and not how I understand observation to be used.
A few points->
(1) Time. The classic teaching is that it demands at least 8hrs. This is true for SAME-DAY observation when billing MEDICARE. If you cross midnight, thats two different days, and thus two different codes, and thus you don’t need 8hr. As well, other payers set their own policies, and I understand some will use 4-6hr. CPT definitions for observation DIFFER from CMS demands for Medicare payment.
(2) Observation, philosophically, is using an extended period of time to treat and observe the patient to decide if a lengthy inpatient stay is required, or if you can send them home. It is NOT time waiting for a test that is only available certain times of day, or waiting room time, or ED boarding time waiting for an inpatient bed that is inevitable. ACEP gives this handy example list:
“OBSERVATION:
- Intoxicated head injury patient observed to r/o significant injury.
- Questionable overdose observed to r/o significant toxicity.
- Chest pain with repeat testing to rule out ischemia.
- Dehydrated patient observed to administer fluids and ability to retain oral liquids.
- Kidney stone observed to repeat x-rays and/or adequate pain control for possible admission.
- Asthmatic requiring repeat treatments and serial exams to determine response to treatment.
- Headache patients requiring repeat treatments and serial exams to determine if they improve with treatment.
- Abdominal pain patients requiring serial exams to determine response to treatment.
Examples of cases where coding Observation services would generally not be indicated:
- Patient waiting on in-patient admission bed.
- Patient awaiting ride home.
- Lengthy procedures (laceration repair, reductions, etc…).
- Broken CT/MRI/Ultrasound/… equipment.
- Busy emergency department and delay in assessments due to volume or staffing.
- Waiting for consultant. “
- A personal pet peeve—> ED OBSV at 10pm so they can get a lower extremity U/S to r/o DVT @0800 the next AM. Nope. Not observation.
(3) The requirements to bill for observation differ for professional and facility billing. The hospital requirements (especially for Medicare) are more arduous, and require:
A. A physician order to place in observation
B. An ED visit code from that day (we are speaking of ED observation specifically)
C. 8hr of time elapsing, starting with the order A.**
D. While actively being cared for in observation, care must be documented in the medical record with an order for observation, admission notes, progress notes, and discharge instructions all of which are dated, timed, written, and signed by the physician or midlevel if applicable.
E. The medical record must include documentation that the physician used "risk stratification" criteria to determine that the patient would benefit from observation care.
**you can’t count time the patient is off unit without an RN, say in radiology for hours not being monitored, having a prolonged test (HIDA). You also can’t count time the patient is sitting in the room after being discharged from OBS, say waiting 90min for a BLS ambulance back to a nursing home.
