Health Information Management

Q/A: Billing for observation stay of fewer than eight hours

APCs Insider, May 28, 2010

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Q: If a patient’s observation stays is fewer than eight hours on the same date of service, is billing both the ED level and the observation with the number of hours when it’s fewer than eight appropriate?

A: CMS expects hospitals to report services that are ordered, medically necessary, and provided to beneficiaries.

Facilities should report observation hours totaling fewer than eight with HCPCS code G0378 to reflect the service provided. CMS instructions do not state that an observation stay of fewer than eight hours should not be reported. CMS requires eight hours be provided before payment is made as part of the Extended Assessment and Management Composite.

Remember that reporting all medically necessary services on claims is important for future rate setting.



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