Facility Updates for 2011 Where Can You Tighten Up for Added Revenue?!

Posted by: Edelberg & Associates

ED volumes continue to climb, joblessness combined with the economic downturn promise to make it a challenging year for hospitals. There is a lot of emphasis on patient satisfaction, safety and security and each require resources to manage effectively. However, for our EDs, as visits soar and payment bottoms out, we need to assure we are capturing all services and coding them appropriately.
Here’s what Medicare pays for ED facility visits in 2011:

  • Visit Code Description OPPS Payment
  • 99281 Emergency dept visit $51.77
  • 99282 Emergency dept visit $87.25
  • 99283 Emergency dept visit $139.14
  • 99284 Emergency dept visit $222.58
  • 99285 Emergency dept visit $329.54


Here are a few things you can do that may give you a revenue opportunity without risking compliance liability:

  • Revisit your ED nursing levels and the content of each. The higher acuity levels (99284 and 99285) reflect the highest and best resources you provide. If they aren’t documented and utilized appropriately by nursing, coding and billing staff you are allowing too much revenue to slip away. Have nurses and coding staff take another look at the services that each level supports and move things around if necessary. Here are some ideas:
  • CT scans, Ultrasounds, Doppler, VQ Scans all indicate a higher level of acuity for patient whose chief complaint requires a higher level of ED resources. Patients who require these services often qualify for 99284 level of service.
  • Patients getting IV’s? Although these services are billed separately, they indicate higher acuity and higher resources for the ED. These patients often qualify for a 99284 level of service.
  • Patient intubated? That’s critical care. Did doctors and nurses remember to document time spent bedside with the patient? Critical care for the facility requires bedside time.
  • Patient treatment requires that a consultant come to the ED to treat a fracture or dislocation? The resources necessary to support the service of outside consultants and all that go with it generally qualify for a 99284.
  • Patient going to observation? Observation can be billed ONLY if the ED service is a 99284, 99285 or Critical Care. Be sure to identify all services to support the patient visit that transitions to observation. Under coding the ED level may result in lost revenue for the observation visit as well.
  • Patient presents with suicidal ideations, requires nursing observation and additional assessments to support patient care and assist family with finding the right solution? Don’t undervalue your services. Although these patients don’t get much in the way of identifiable ED interventions (meds, diagnostic tests, surgical procedures) the time and resources can be significant. Be sure mental health evaluations and nursing support of the patient and family throughout the ED visit are identified correctly.

Modifications to billing rules for Observation make it imperative that you assure your 99284 and 99285 ED services are defined appropriately. Observation is a billable and valuable service. However, as a composite service requiring billing of an ED visit (99284, 99285) or 99291 (Critical Care) in addition to Observation during or following the ED visit, Medicare will drop the payment for Observation and pay only the ED level if the code combination isn’t right. You are vulnerable to a significant financial loss to your institution and may reflect a lack of knowledge of similar issues in other departments as well. (Where there’s smoke there’s Medicare!)


Improperly defined nursing criteria can really affect your Observation revenue if you are unable to bill the 99284, 99285 or 99291 Critical Care required in addition to the Observation service. The new Observation payment rules require that and ED 99284, 99285 or 99291 Critical Care be billed in addition to the Observation service. A payment of either $329.54 (99285) or $222.58 (99284) will be made for the ED visit as required for payment for Observation (Extended Facility Assessment and Management Composite Level II). Observation is then paid at an additional $714.33. So, if you bill it right, the ED and observation stay will provide you a minimum payment of either $1043.87 (99285 with Extended Assessment/Observation) or $936.91 (99284 with Extended Assessment/Observation). Multiply this times the number of times your ED provides treatment at this level and you have a significant financial reward for your efforts. Remember, content of the code levels determines how they are billed so if don’t under-reporting your higher acuity levels as a result of over conservative nursing criteria that is too restrictive or being used incorrectly.


APC Group Title SI 2011 Relative Weight 2011 Payment Amount
8002 Level I Extended Assessment & Management Composite V 5.7236 $394.22
8003 Level II Extended Assessment & Management Composite V 10.3712 $714.33
HCPCS Code Short Descriptor APC Relative Weight Payment Rate
G0378 Hospital observation per hr N
G0379 Direct admit hospital obs Q3 0604 .7602 $52.36
Medicare OPPS Observation Payment 2011


Medicare is aware that the dramatic change in the observation billing concept may encourage hospitals to rethink how they are billing the associated E/M levels. In the 2009 final rule, Medicare expressed, We do not expect to see an increase in the proportion of visit claims for high level visits as a result of the new extended assessment and management composite APCs 8002 and 8003 adopted for CY 2008 and finalized for CY 2009. Similarly, we expect that hospitals will not purposely change their visit guidelines or otherwise upcode clinic and emergency department visits reported with observation care solely for the purpose of composite APC payment. As stated in the CY 2008 OPPS/ASC final rule with comment period (72 FR 66648), we expect to carefully monitor any changes in billing practices on a service-specific and hospital-specific level to determine whether there is reason to request that Quality Improvement Organizations (QIOs) review the quality of care furnished, or to request that Benefit Integrity contractors or other contractors review the claims against the medical record. This doesn’t prevent adjusting your ED criteria.


But beware of a sudden increase in higher acuity ED visit codes (99284-85 and 99291 Critical Care) without rationale. Your documentation must support the level of service—the easiest place for an auditor to look and find fault with your coding. For example, if your physicians and/or nurses are forgetting to identify the amount of time spent performing critical care services and you can’t support 30 minutes of more but bill it anyway, you may find payment overturned on audit. ED’s provide a much higher volume of critical care than is usually billed because of documentation problems so (1)be sure it’s documented when performed; (2)be sure it’s billed when documented correctly, and (3) be sure all agree as to the content of critical care and how it should be documented before payers come calling.


If documentation templates are still in use in your ED and they’ve been modified and re-modified over time, create a task force to take another look at your process and content in order to assure that all of the elements necessary for coding are there and being used correctly by your coding staff. Physician documentation supports professional and technical billing and the better-documented services appear, the less likely payers are to recoup payments if services are billed correctly.

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    Talk To Our Team Today

    Get in touch and we'll be happy to personally assist you all the way through.