Corporate Compliance

Billing inpatient-only procedures for an outpatient

Compliance Monitor, October 28, 2005

Q. Our utilization management staff is being asked to change patient types based on the CMS inpatient-only procedure list.

Occasionally, however, the patient is not being admitted to an inpatient unit, but rather is discharged from the post anesthesia recovery room or a "transitional, short-stay unit" (usually within a few hours), with most being discharged on the same day as admission. There is no order to admit the patient as an inpatient.

I have called our fiscal intermediary (FI), and initially was told to change the patient to an inpatient. But when I mentioned the patient did not transfer to an inpatient unit-and there would be no room and bed charge-the FI advised me to bill for an outpatient and amend a comment to the bill explaining that we are aware the procedure code is on the inpatient-only list, but that the case was done as an outpatient rather than an inpatient.

Is this the best way to handle this situation?

A. Prior to the outpatient code editor (OCE) update that occurred in April 2005, providers were able to bill an inpatient-only procedure on an outpatient claim by appending the procedure code with modifier CA.

The purpose of this was to accommodate outpatients who undergo inpatient-only procedures on an emergency basis and who expire before they can be admitted to the hospital.

However as of the April update, a new edit has been added to ensure that these claims are only paid when a patient has expired. This new edit requires that a patient status code of 20 (patient expired) be present on the outpatient claim when a CA modifier is used. Otherwise the claim will be returned to the provider.

With the exception of this situation, CMS has provided no sanctioned method to bill inpatient-only procedures on an outpatient claim.

I would suggest contacting the CMS regional office in your area to get guidance on your question. You can find contact information at the following link

This answer was provided by Kathleen Ochal, product manager, revenue cycle product management, Siemens Medical Solutions

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