Medical Observation Versus ER Charge – Video

Alicia: Q: Observation vs. ER: My question is simple, when there is a 760 OBV charge on the claim with a 450 ER charge as well. That claim is no longer an ER bill, correct?

In the answer, there’s more of a description of what the person was asking, a little more detail, didn’t want to put it all on that first slide. She went on to say: I can’t get clear answers. You can really tell when you’re getting feedback from a coder versus getting feedback from a coder with a billing background. My question is simple – which we read earlier.

The patient status has changed to observation and since the claim was coded with an observation, the claim should be processed as an observation or outpatient, not an ER bill. I had a co-worker that believes that the claim is still an ER because the observation hours were under 23 hours. I tried to explain that the observation would dominate the ER because the patient status changed and it does not matter how long the person was in observation. Is this correct?

Medical Observation Versus ER Charge – Video

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A: Tiffany is correct. It has changed status to an observation.

I went in and pulled some information, I got this little scheme here. Specialty Services, it goes on to say: “Charges for patients requiring treatment room services or patients placed under observation. Patient’s Reason for Visit should be reported in conjunction with 0762” and these codes are Volume 3 codes, so not ones that you’re probably still looking at if you’re an outpatient coder. “Only 0762 should be used for observation services.

Observation services are those services furnished by a hospital on the hospital’s premises, including use of a bed and periodic monitoring by a hospital’s nursing or other staff, which are reasonable and necessary to evaluate an outpatient’s condition or determine the need for a possible admission to the hospital as an inpatient. Such services are covered only when provided by the order of a physician or another individual authorized by State licensure law (meaning, like PA’s and stuff like that) and hospital staff bylaws to admit patients to the hospital or to order outpatient tests. Most observation services do not exceed one day. Some patients, however, may require a second day of outpatient observation services. The reason for observation must be stated in the orders for observation. Payer should establish written guidelines that identify coverage of observation services.” In other words, you need to check with the payer.

Now, that’s giving you a description of outpatient and most hospitals in their outpatient services will designate how many hours that is, so that’s what this other person is thinking, “Oh, it wasn’t enough hours.”

Now, for the ER Room though: “Charges for emergency treatment to those ill and injured persons who require immediate unscheduled medical or surgical care. Observation or hold beds are not reported under this code. They are reported under revenue code 0762, ‘Observation Room.’”

So, Tiffany was correct in what she was saying, if a person comes into the ER and let’s say they suspect appendicitis. The blood work came back, but not quite elevated enough on the white blood count. They’ve got pain, they’ve got nausea and vomiting; but they’re just not sure. They don’t want to take him in and open him up, unless they have to. So, what they’re going to do is not keep him in the ER. They’ll go ahead and hold him in the observation because they’re pretty sure it’s going to go ahead and be something that needs an appendectomy, but until that point they’re going to just keep him in observation. They are no longer an ER status. As soon as they turn them into an observation status, that is what you’re going to code for – observation, not ER. Timing doesn’t really matter on this. There’re rules that individual hospitals have or different insurance companies may have, but the codes are all based on the status of the patient not the time of the patient that they’re in the ER or in observation.

Read More about Medical Observation

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AAPC – ER billed with Observation Charge

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