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Last Modified: 5/18/2024 Location: FL, PR, USVI Business: Part A, Part B

Improve your billing of hospital inpatient or observation discharge day management codes

Evaluation and management (E/M) services are a significant contributor to the Medicare Part B improper payment error rate, which includes hospital discharge day management codes. The top issues identified for this code set relate to insufficient documentation and incorrect coding. These E/M services include the following CPT codes:
99238 – Hospital inpatient or observation discharge day management; 30 minutes or less
99239 – Hospital inpatient or observation discharge day management; more than 30 minutes
As explained in the CPT manual, these codes are to be utilized to report all services provided to a patient on the date of discharge, if other than the initial date of inpatient status. To report services for a patient who is admitted inpatient or observation and discharged on the same date, use codes 99234-99236 for observation or inpatient hospital care including admission and discharge of the patient on the same date. To report concurrent care services provided by an individual other than the practitioner performing the discharge day management service, use subsequent hospital inpatient or observation care codes (99231-99233) on the day of discharge.
Additional guidance is provided within the Centers for Medicare & Medicaid Services (CMS) Internet-only manual (IOM):

Hospital inpatient or observation discharge day management service

A 'Hospital Inpatient or Observation Discharge Day Management Service' (CPT code 99238 or 99239) is a face-to-face E/M service between the attending provider and the patient. The E/M discharge day management visit shall be reported for the date of the actual visit by the physician or qualified nonphysician practitioner (NPP), even if the patient is discharged from the facility on a different calendar date. Only one hospital inpatient or observation discharge day management service is payable per patient, per hospital stay.
Only the attending provider of record reports the discharge day management service.
Medicare pays for the paperwork of patient discharge day management through the pre- and post-service work of an E/M service.

Initial hospital inpatient or observation care on day following visit

Medicare pays both visits if a patient is seen in the office on one date and admitted to the hospital on the next date, even if fewer than 24 hours has elapsed between the visit and the admission.

Initial hospital inpatient or observation care and discharge on same day

When the patient is admitted to inpatient hospital or observation care for less than eight hours on the same date, then 'Initial Hospital Inpatient or Observation Care' (CPT code range 99221–99223) shall be reported by the provider. The 'Hospital Inpatient or Observation Discharge Day Management' service (CPT code 99238 or 99239) shall not be reported for this scenario.
When a patient is admitted to inpatient initial hospital or observation care and discharged on a different calendar date, the physician shall report an 'Initial Hospital Inpatient or Observation Care' (CPT code range 99221–99223) and a 'Hospital Inpatient or Observation Discharge Day Management' service (CPT code 99238 or 99239).
When a patient has been admitted to inpatient hospital or observation care for a minimum of eight hours but less than 24 hours and discharged on the same calendar date, 'Hospital Inpatient or Observation Care Services' (including admission and discharge services), from CPT code range 99234-99236, shall be reported.

Hospital inpatient or observation discharge management and death pronouncement

Only the physician who personally performs pronouncement of death shall bill for the face-to-face 'Hospital inpatient or observation Discharge Day Management Service' (CPT code 99238 or 99239). The date of the pronouncement shall reflect the calendar date on the day the service was performed, even if paperwork is delayed to a subsequent date.

Hospital inpatient or observation discharge management and nursing facility admission on same day

When a patient is discharged from a hospital and admitted to a nursing facility on same day, MACs shall pay the hospital inpatient or observation discharge code (CPT code 99238 or 99239) in addition to a nursing facility admission code when billed by the same physician with the same date of service.
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