Health Information Management

Report condition code 51 for nondiagnostic services unrelated to inpatient stay

JustCoding News: Outpatient, December 14, 2011

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Consider this scenario: A 42-year-old female patient presents to the ED with ankle pain after falling from a ladder. The patient receives IV pain medication, and diagnostic x-rays confirm an uncomplicated fracture. The nurse places a splint on the patient's ankle, and the physician writes a prescription for oral pain medication. The physician then discharges the patient.

Later the same day, the patient experiences an allergic reaction and returns to the ED. The physician diagnoses the patient with an adverse allergic reaction to the narcotics, administers IV medication, and admits the patient for continued monitoring due to a history of acute and chronic asthma as well as diabetes.

Does the inpatient admission include both visits, or should coders report them separately?

Three-day payment window
The three-day rule defines certain preadmission services as inpatient operating costs, meaning they are bundled and billed as part of the inpatient claim, and payment is made as part of the applicable diagnosis-related group payment.

Under the three-day rule, CMS assumes all preadmission diagnostic and related nondiagnostic services occurring three calendar days prior to admission are related. Coders can separately bill clinically unrelated nondiagnostic preadmission services.

Prior to June 25, 2010, CMS only considered the outpatient nondiagnostic services related if there was an exact match between the first-listed diagnosis code and the inpatient principal diagnosis code. However, CMS now defines "related" as "clinically associated with the reason for a patient's inpatient admission."

If the facility provides non¬diagnostic outpatient services that are unrelated to an inpatient admission—and those nondiagnostic outpatient services occur within three calendar days prior to the admission—the facility can bill those unrelated services on a separate outpatient claim, says Debbie Mackaman, RHIA, CHCO, regulatory specialist for HCPro, Inc., in Danvers, MA. As a result, the facility may be reimbursed for the unrelated services under the appropriate APC.

CMS created condition code 51 (attestation of unrelated outpatient nondiagnostic services) as a way for facilities to identify those services that are unrelated and for which separate outpatient reimbursement is appropriate. Coders should report condition code 51 on the outpatient claim for the unrelated services. The FI/MAC should pay the claim without question; however, the claims are subject to review, explains Mackaman.

In the scenario described above, the admission is most likely clinically related to both ED visits, and all outpatient charges should be included on the inpatient claim, Mackaman says. "Basically, the patient wouldn't be having an allergic reaction to the narcotics if she did not fracture her ankle."

However, under the three-day rule, all outpatient charges would have to be included on the inpatient claim regardless of the clinical relationship. If outpatient services are provided on the day of the inpatient admission, all diagnostic and non-diagnostic services must be included on the inpatient claim.

Unrelated visit
Consider another scenario: The same patient described previously (i.e., the one who fell from a ladder) returns to the ED suffering from chest pain instead of an allergic reaction. The physician orders diagnostic studies, and then admits the patient after discovering she has an acute myocardial infarction.

Again, even though the ED visit is clearly not clinically related in this scenario, because all of the outpatient services (diagnostic and non-diagnostic) were provided on the day of the inpatient admission, the facility must bill all outpatient charges on the inpatient claim under the 3-day rule. Coders should not report condition code 51 for the ED E/M visit and or any other nondiagnostic services because those nondiagnostic services were provided on the day of the inpatient admission, Mackaman says. CMS continues to require facilities to bill all diagnostic outpatient services on the inpatient claim in both scenarios. 

Consider a third scenario: A woman is scheduled to undergo breast reduction surgery on Friday. The day before the surgery, she slips on ice, falls, and breaks her wrist. She goes to the ED for treatment of her wrist fracture on Thursday and is then admitted Friday for her planned surgery.

"This is not part of the three-day window and should be coded out with the addition of a condition 51 code on the [outpatient] claim," says Nancy Reading, RN, BS, CPC, CPC-I, coding analyst for CodeRyte in Bethesda, MD.

Documenting unrelated services
In order for coders and billers to correctly assign condition code 51, providers must clearly document why they provided the outpatient services, Reading says. That documentation must also support the fact that these services are not clinically associated with the inpatient stay.

Providers must document that they are treating an unrelated condition, Reading says. "Care of that condition should not be included in the inpatient admission if there is sufficient evidence that it is not related."

Staff members should never assume a condition is unrelated, Reading warns. "Always look for provider clarification, and if in doubt, generate a provider query," she says. The clinical documentation improvement team can handle this task concurrently during the inpatient stay.

Avoid under- and overusage
Condition code 51 is relatively new. CMS introduced it in April, so facilities may not be reporting it, Mackaman says. Staff members may incorrectly assume that all of the nondiagnostic services are actually related to the inpatient admission and that all nondiagnostic services are subject to the three-day payment window.On the other hand, some facilities may be reporting condition code 51 incorrectly for services that do fall within the three-day window or for services that are not supported by provider documentation as being separate or unrelated, Reading says.

Communicate information across the facility
Effective communication between clinical staff, HIM/coding, and patient financial services staff is paramount. Larger facilities may struggle with opening the lines of communication because of the silo effect, Mackaman says. The silo effect refers to the lack of communication and cross-departmental support often found in large companies. Teams work only on their own goals, often ignoring the needs of others, and information gets lost.

"You can't have a billing system that automatically rolls outpatient charges into the inpatient account based on a date," Mackaman adds. "A staff member must manually review claims in those situations."
When necessary, coders should be able to communicate with clinical staff members to clarify whether the outpatient services are related, she says. After that is determined, coding or billing staff need to inform patient financial services whether to roll the outpatient charges onto the inpatient bill or report the charges separately on the outpatient claim with condition code 51.

Set up a solid process to ensure compliance at your facility, Mackaman says. Start with the dates of service for the outpatient accounts compared to the inpatient admission date. The three-day window only applies to the three calendar days immediately before the inpatient admission.

If the dates overlap, facilities need to determine which diagnostic charges will always be billed on the inpatient claim and which nondiagnostic charges should or should not be billed on the claim based on the clinical relationship and the date of inpatient admission. "It is not an automatic decision based on a computer system date and time,"  Mackaman says. Because of the potential for over- or underpayments and the recovery audit contractor and Office of Inspector General focus on this subject, facilities should audit their processes and their claims to reduce their overall risk.

Editor’s note: This article was originally published in the December issue of Briefings on APCs. E-mail your questions to Senior Managing Editor Michelle A. Leppert, CPC-A, at

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