Chronic but Stable; Cookie-Cutter Notes; Billing for Observation Services

Coding questions? We've got the answers

Chronic but Stable

Q: If a patient presents with multiple chronic illnesses that are stable, and the physician reviews the status of these illnesses as part of the office visit, can the physician bill an E&M visit in addition to the physical exam? I've always told docs that reviewing stable chronic illnesses is part of a preventive service and does not warrant billing an additional office visit. However, I can't find documentation to prove this anywhere.

A: Preventive services don't include evaluating or managing chronic problems - whether they are stable or not. If you read the description for preventive services in CPT, it does tell you that problems that do not require the significant, additional work associated with a 99201-99215 (meaning taking a patient history relevant to those problems and associated MDM) should not be coded separately.

CPT is saying if the chronic problem is a "by the way," brought up secondary to the preventive service, or maybe requires a prescription refill (with which there is no associated status or history in the HPI and no obvious assessment in the A/P) - then it shouldn't be coded as a separate E&M. But if the physician documents the status of chronic problems in the HPI, and also echoes them in the A/P - then they are in fact quite billable in addition to the preventive service.

Cookie-cutter Notes

Q: When our practice purchased our EHR one of the selling points was that in the physician charting section every note could be constructed to open up with a complete normal review of systems area and a complete normal physical exam. As I read more about cloning and repetitive documentation, I' m starting to wonder if this is a safe practice for my providers. Are they at risk if they document this way?

A: Great question! And the answer is that they may well be at risk depending on how much they rely on the pre-formatted version of ROS and PE that the EHR sets forth as a template.

What we are hearing from Medicare Administrative Contractors (MACs) and the Office of the Inspector General (OIG) is that repetitive documentation, or cloning, is becoming more pervasive and constitutes a medical necessity violation. In other words, as regulators see more and more notes that appear to have been written essentially by the computer, and are either out of proportion to or out of touch with the nature of the problems described in the HPI and A/P, they get the sense that the disjointed portions of the note may just be "filler" and therefore designed to qualify for a higher level of service code. That is their fear.

The truth is probably somewhere between deliberate overcoding/over-documentation and plain-old user error. If you are seeing excessive, cookie-cutter documentation in the ROS and PE sections of the record, then your provider is likely just moving too quickly through these areas rather than taking the time to customize her findings. Some of this may just be carelessness, some may be due to a cumbersome system, or some may just be haste. After all, the EHR just does what it is programmed to do.

But that said, it is particularly disturbing to reviewers or auditors when elements of the HPI are contradicted in the ROS - the credibility of the whole note comes into question. Likewise when the chief complaint and HPI are all about a particular body area or problem, and the documented exam for that area or system is identical to the last five patients who did not have issues in that area, it raises a red flag.

So yes, if the EHR is used carelessly then the impression given may point to behaviors you don't want to suggest. See the element from the 2011 OIG Workplan for physicians below.

"Medicare contractors have noted an increased frequency of medical records with identical documentation across services. We will also review multiple E&M services for the same providers and beneficiaries to identify electronic health records (EHR) documentation practices associated with potentially improper payments."

Taking Vitals With Lab Results

Q: I have a family practice clinic. When a patient comes in for lab results, am I required to take her vitals and document them in the medical record to be able to bill for that charge?

A: We need to backtrack a little and determine what you mean when you say "comes in for lab results." Is this a meeting with you the physician/practitioner? Is it a meeting with nursing or support staff? The answer also depends on which code you bill.

Those things will determine the answer. Because you asked if you had to take vitals it makes me wonder if there is a history/exam aspect to this or if the nature of the visit is counseling - talking to the patient about lab results and/or disease management. If it is counseling or just talking to the patient, then you document the time and the content and that dictates the code. There is no need to address elements of history and exam (including vitals).

If the encounter for "f/u lab" is with support staff, then you can't get past level one, and even then vitals aren't required because the 99211 doesn't have a history/exam requirement.

Billing for Observation Services

Q: We have a situation where our physician goes to the hospital to see a patient in observation. The patient is later admitted by a provider from another group. The hospital converts the observation portion of the stay to inpatient after he is admitted.

Our issue is that we want to bill an outpatient visit because that's what we did while the patient was in observation, but these get denied because the place of service has been changed to inpatient.

A: Yep - you found a crack in the system. This crops up in several ways when hospitals obey hospital coding rules and the result is sometimes to leave the physician coding out in the cold so to speak.

Observation services are indeed outpatient services and need to be reported with place of service 22, outpatient hospital. Once the hospital starts changing the status of the patient to accommodate its own billing requirements you may indeed get a denial for place of service. If you use place of service 21, inpatient hospital, you may get a denial for incorrect code with place of service.

Now that we have the new observation, subsequent visit codes 99224-99226 we even have special codes for some of these visits - but still have the place of service issue. The real mystery is what place of service do you use for codes 99234-99236, same-day admit/discharge for either observation or hospital admits?

No matter which way you play, you may get a denial - so prepare to do some explaining. There's no easy answer for this one.

Bill Dacey, CPC, MBA, MHA, is principal in the Dacey Group, a consulting firm dedicated to coding, billing, documentation, and compliance concerns. Dacey is a PMCC-certified instructor and has been active in physician training for more than 20 years. He can be reached at or

This article originally appeared in the July/August 2011 issue of Physicians Practice.


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