Hit and Miss: AMA Misses Opportunity to Simplify Hospital E&M Coding

AMA scores a hit with new guidelines; misses simplification of one subset of hospital E&M codes.

It was a happy day in 2020 the American Medical Association (AMA), the owner of the CPT® code set, announced a modification to the Evaluation and Management E&M coding guidelines for the office or outpatient visit code set (99201 – 99215) that became effective Jan. 1, 2021. Not only did they delete 99201, the low-level new patient visit code, which was rarely if ever used, but they also dramatically changed the rules for choosing a visit code, eliminating the need for a specific number of elements of the history, review of systems, and physical examination.

Instead of counting bullet points to meet a specific visit level, the new guidelines rely on either time or medical decision-making. Not one person would mourn the loss of the bloated progress note, full of superfluous information.

While there was elation in the physician office visit coding world, there was frustration expressed by hospital physicians at being left behind. For the time being, patient visits that took place in the hospital, either as inpatient or outpatient, and even in the emergency department, would still require use of the coding rules that date to the 1990s, including specific elements of history, including the all-important family history, especially important in octogenarians, asking about 10 body systems (for the dreaded Review of Systems) and examining the required number of body parts, regardless of the reason for the visit.  Yes, that meant if a urologist was called to evaluate a hospital patient with urinary retention, their examination of the head and neck would still need to be performed for some codes.

That frustration lasted “only” two years as the AMA announced in July 2022 that these same changes would extend to the hospital setting on January 1, 2023, including the emergency department and outpatients who are receiving observation services, basing code choice on either medical decision-making or time spent, with the emergency department visit codes limited to medical decision-making. The details of these coding guidelines, along with the other changes adopted, can be found in a summary from the AMA found here, or from numerous locations on the internet, such as this fantastic article by my friend Dr. Erica Remer from ICD10monitor.com.

Now here is where the AMA messed up. Throughout these new guidelines, they refer to the use of codes 99221-99223 for initial visits and 99231-99239 for subsequent visits and discharge day services for billing “Hospital Inpatient and Observation Care Services.” But there are an increasing number of patients who are hospitalized neither as inpatient nor as outpatient receiving observation services. The typical patient is the patient having an elective surgery scheduled as outpatient who spends a night (or two or three depending on their payer source) in the hospital for routine recovery. In these cases, the surgeon will usually consult either a hospitalist or specialist to manage the patient’s chronic medical illnesses during their stay.

Since these patients are receiving neither “Hospital Inpatient” nor “Observation Care Services,” the use of the code set 99221-99223 for initial visits and 99231-99239 for subsequent and discharge day services is not appropriate. So, what codes should be used? In email correspondence with the AMA staff, I was informed that, “Based on the information provided, the hospitalist E&M is correctly reported with the appropriate code from the E&M Office or Other Outpatient code series, 99202-99205, 99212-99215 based on whether the patient is a new or established patient, and the level of E&M service provided by the hospitalist.” That means instead of choosing from one of three codes for the first visit, 99221-99223, the physician will need to first determine if the patient is a new or established patient using the CPT guidelines and then depending on that, choose one of 4 visit levels (99202-99205 for new patients and 99212-99215 for established patients) using the E&M coding guidelines specific to office or other outpatient codes.

This is the opportunity the AMA missed. They could have specified the use of the 99221-99223 and 993231-99239 code set for “Hospital Inpatient, Outpatient and Observation Care Services” to standardize code choice for physicians. That would truly have simplified the code choice, eliminated the use of “office visit” codes in the hospital, and prioritized patients over paperwork.

The question that arises is what would happen if a hospitalist coded a visit of a hospital outpatient not receiving observation services with the Observation Care Services codes. In theory, the payer’s claim processing system would compare the professional fee charges to the facility fee charges, see no line-item charge for HCPCS G0378 and deny the physician claim. The frequency with which this actually happens is a mystery as I have yet to see a Medicare contractor report the results of an audit of “physician hospital visit accuracy based on place of service and appropriate code set.” I suspect the auditors have much bigger fish to fry. And as we all know, commercial payers will never share the target or the results of their audits.

Finally, it should be noted that in a very informal poll of coders who code office visits, many reported that the notes they review in 2022 continue to include elements that are no longer required such as the complete review of systems and a comprehensive examination just as they did prior to 2021, suggesting that many physicians remain unaware of the new coding rules. I would hope that prior to these rules for hospital visits taking effect on Jan. 1, 2023 every hospital will train all their physicians, from emergency medicine to hospitalists to specialists, on the new guidelines. I suspect that every single physician will rejoice in knowing they no longer have to ask questions or examine body parts that are completely irrelevant to the patient’s current medical care and would be able to spend more time actually providing patient care and documenting the elements that truly matter.

Programming note: Listen every Monday morning when Dr. Hirsch makes his Monday Rounds on Monitor Mondays 10 Eastern and sponsored by R1-RCM.