99221, 99218, 99234 CPT® Code Descriptions, Progress Note, RVU, Distribution.

This 99221, 99218 and 99234 CPT® lecture reviews the procedure code definitions, national distribution data, RVU values and progress note requirements for the low level initial hospital service encounter. CPT stands for Current Procedural Terminology. I have chosen to discuss these three codes together because their coding guidelines are the same with regards to the level of service provided. What is the difference between these three initial hospital service encounter codes? CPT® 99221 is the low range (level 1) initial inpatient hospital H&P encounter code. CPT® 99218 is the low range (level 1) initial hospital observation H&P encounter code used only by the attending physician or non-physician practitioner (NPP). CPT® 99234 is the low range (level 1) admit and discharge same day bundled encounter code used only by the attending physician or NPP. CPT® 99234 can be used in both inpatient and observation same day admit and discharge scenarios.  Before the level of service can be decided, understanding which set of  initial hospital encounter codes are appropriate is necessary.  

CHOOSING THE CORRECT INITIAL HOSPITAL SERVICE CODE GROUP

 

All three of these initial hospital encounter codes represent the lowest level of service under the Healthcare Common Procedure Coding System (HCPCS) for initial inpatient, observation and admit and discharge same day bundled hospital encounters. Before physicians and NPPs can choose the right level of CPT® service (low, medium or high), they must first understand which group of CPT® codes apply in their initial hospital service encounter (inpatient, observation, same/day admit and discharge, critical care). For readers who need further help in determining the correct group of codes to consider for their admission, I refer them to my post on how to choose the right group of CPT® hospital admission codes. At that lecture, I help guide the physician and other NPPs through a series of questions that help them determine which set of initial hospital encounter codes apply to their patient's situation. This process can become quite complex. I recommend understanding it well before proceeding with this coding lecture. Once the correct group of codes are determined, the practitioner can determine the correct level of service. The rest of this lecture describes the the level 1 (low) initial hospital service encounter codes 99221, 99218 and the bundled admit and discharge same day code 99234.

The mid level hospital admission for inpatient, observation and same day admit and discharge hospital codes (99222, 99219 and 99235 respectively) and the high level hospital admission for inpatient, observation and same day admit and discharge hospital codes (99223, 99220 and 99236 respectively) are described elsewhere on The Happy Hospitalist as part of my complete collection of CPT® lectures. I am a board certified internist and hospitalist with over ten years of clinical experience at a  community hospitalist program in a  large hospital system. I have written an extensive collection of evaluation and management (E/M) lectures over the years to help physicians and NPPs (nurse practitioners, physician assistants, clinical nurse specialists and certified nurse midwives) understand the complex world of hospital and clinic based evaluation and management coding requirements. Some of these lectures were written several years ago, but their information remains highly relevant today.

Once the clinician has chosen the correct group of initial hospital care codes, the right CPT® level of service that documentation supports should then be defined. The rest of this coding lecture details the requirements for the low level initial encounter codes. For the purposes of simplicity, the billing requirements for 99223 = 99220 = 99236. The billing requirements for 99222 = 99219 = 99235. The billing requirements for 99221 = 99218 = 99234. This is why I have chosen to bundle these three initial hospital service CPT® evaluation codes together for discussion.

My collection of lectures and accompanying coding resources are used by myself to make sure I stay compliant with the rules and regulations of the Centers for Medicare & Medicaid Services (CMS). All CPT® lectures I have written are organized here in one easy-to-find location. Always remember the billing clinician has a responsibility to make sure their documentation supports their  level of service they are submitting for reimbursement. The volume of chart documentation written in the chart  should not be used to determine the level of billed service. What matters most are the details of the documentation as defined by the rules discussed in this and other CPT® lectures. The CMS E/M services guide referenced below says the care provided must be "reasonable and necessary". In addition, all progress notes must be dated and have a legible signature or proof of signature attestation.

99221, 99218, 99234 CODE DESCRIPTIONS


My interpretations detailed below are based on my review of the 1995 and 1997 E&M guidelines, the CMS E&M guide and the Marshfield Clinic audit point system for medical decision making. These resources can be found in my hospitalist resources section. The Marshfield Clinic point system is voluntary for Medicare carriers but has become the standard compliance audit tool used by most Medicare carriers. You should check with your own Medicare carrier in your state to verify whether or not they use a different standard than that which I have presented here in my free educational discussion. I recommend all readers obtain their own up-to-date CPT® reference book as the definitive authority on CPT® coding. I have provided access to Amazon through the 2014 CPT® standard edition pictured to the right. These three CPT® codes can be used by any qualified healthcare practitioner to get paid for their hospital initial service evaluations. How does the AMA define codes 99221, 99218 and 99234?

CPT® 99221 is defined by the AMA as:
Initial hospital care, per day, for the evaluation and management of a patient, which requires these three key components: a detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making of straightforward or low complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the problem(s) requiring admission are of low severity. Physicians typically spend 30 minutes at the bedside and on the patient's hospital floor or unit.
CPT® 99218 is defined by the AMA as:
Initial observation care, per day, for the evaluation and management of a patient, which requires these three key components: a detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making of straightforward or low complexity. Counseling an/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the problem(s) requiring admission to "observations status" are of low severity.  Physicians typically spend 30 minutes at the bedside and on the patient's hospital floor or unit.
CPT® 99234 is defined by the AMA as:
Observation or inpatient hospital care, for the evaluation and management of a patient including admission and discharge on the same date which requires these three key components: a detailed or comprehensive history; a detailed or comprehensive examination; and medical decision making of straightforward or low  complexity. Counseling and/or coordination of care with other providers or agencies are provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually the presenting problem(s) requiring admission are of moderate severity. Physicians typically spend 40 minutes at the bedside and on the patient's hospital floor or unit.
From the descriptions detailed above one can see the requirements for CPT® 99221, 99218 and 99234 are identical.  The only difference is the typical time spent on the admission and discharge same date encounter is 40 minutes instead of 30  minutes.  This is why these three codes can be grouped together when discussing the E/M guidelines. Time based billing is allowed with these three CPT® codes under certain circumstances. I have detailed those discussions at the provided link. However, documentation of time is not required to stay compliant with CMS rules. If billed without time as a consideration, these three codes should be billed based on the documentation rules establisehd in the 1995 or 1997 guidelines referenced above. The three relevant components to a hospital initial service care note are the:
  1. History 
  2. Physical Examination 
  3. Medical Decision Making Complexity (MDM)
For all initial hospital encounter evaluations, the highest documented three out of three for history, physical and MDM determines the correct CPT® service code. Compare this with the highest documented two out of three components being required for hospital subsequent care encounters. Again,  the level of service for all three groupings of initial hospital encounters from 99221-99223, 99218-99220 and 99234-99236 are determined by the highest  three out of three components from history, physical exam and MDM.  Rephrased another way,  the level of service is determined by the lowest level of documentation from any one of those three areas.  Since this lecture details a level 1 (lowest) service, all three components (history, physical and MDM) must meet the minimum requirements for a level 1 (detailed below) to bill an initial hospital encounter code 99221, 99218 or 99234.  

What happens if the minimum requirements for a 99218 are not met?  The clinician should bill for the service that most represents what their documentation supports.  In this case, documentation would likely support a code from the inpatient or outpatient or observation subsequent care CPT® groups. This reference (in question 2) explains substitution of subsequent care codes for initial hospital encounter codes.   Remember, if you don't document your work, it's considered not done.  Documentation is key to staying compliant.   The following discussion details the absolute minimum documentation requirements for CPT® codes 99221, 99218 and 99234. In addition, remember a face-to-face encounter is always required for all E/M encounters.
  • Detailed history
    • Requires 4 elements from the history of present illness (HPI) OR documentation of the status of three chronic or inactive medical conditions.   HPI elements are location, quality, severity, duration, timing, context, modifying factors and associated signs and symptoms.
    • Requires  documentation about the system related to the problem in the HPI plus 2-9 additional review of systems.  ROS is an inventory of body systems.  The E/M rules recognize the following systems for ROS purposes:  constitutional symptoms, eyes, ears/nose/mouth/throat, cardiovascular, respiratory, gastrointestinal, genitourinary, musculoskeletal, integumentary (skin and or breast), neurological, psychiatric, endocrine, hematologic/lymphatic and allergic/immunologic.  Those systems with positive or pertinent negative responses must be individually documented.
    • Requires documentation from 1 pertinent element from past medical history (illnesses, operations, injuries and treatments) or family history or social history. These components together are referred to as the PFSH.
  • Detailed physical exam:
    • 1995 guidelines: An extended examination of the affected body area(s) and other symptomatic or related organ systems(s).
    • 1997 guidelines: An extended examination of the affected body area(s) or organ system(s) and any other symptomatic or related body area(s) or organ system(s).  For general multi-system examinations, documentation should include at least six organ systems or body areas with at least two elements identified by a bullet in each.  Alternatively, a detailed examination may include documentation of at least twelve elements identified by a bullet in two or more organ systems or body areas.  Physical exam is complex for E/M. This process is thoroughly detailed in the CMS E/M reference guide (pages 31-32 for the 1995 guidelines and pages 49-81 for the 1997 guidelines)
    • Note the wordage difference with body area vs organ systems. They are not the same. This stuff is complex.  A review of the acceptable body areas and organ systems can be found in that CMS E&M reference guide on pages 31 and 32.  The recognized body areas are head (including face), neck, chest (including breasts and axillae), abdomen, genitalia (including groin and buttocks), back (including spine) and each extremity. The recognized organ systems are constitutional (including vital signs and general appearance), eyes, ears/nose/mouth/throat, cardiovascular, respiratory, gastrointestinal, genitourinary, musculoskeletal, skin, neurological, psychiatric, hematologic/lymphatic/immunologic.
  •  Medical decision making of straightforward or low complexity (MDM): Medical decision making  is split into three additional components, the highest 2 out of the 3 levels in MDM of which are used to determine the overall level of MDM. The level is determined by a complex system of points and risk. What are the three components of MDM and the minimum required level of points and risk as defined by the Marshfield Clinic audit tool?
    • Diagnosis (1 point) 
    • Data (0 points) 
    • Risk (minimal) The table of risk can be found on page 20 of the CMS E/M reference guide.
The medical decision making point system is quite complex. I have a detailed a cheat sheet reference to it on my E/M pocket cards described below. These cards help me understand everyday what type of care my documentation supports. I carry these cards with me at all times and reference them all day long. They help me understand what level of service my evaluation qualifies for and they have prevented me from under and over billing thousands of times over the last decade.

CLINICAL PROGRESS NOTE EXAMPLE OF 99221

Chief complaint: My leg is red
HPI:  28 yo Male with 3 day history left calf pain. 6/10, dull, constant. Associated edema, erythema. (4 elements from HPI)
PFSH:  Smoker  (One element from PFSH)
ROS:  No lightheaded symptoms, CP or SOB. (2-9 ROS systems with cardiovascular and respiratory)
Exam: 120/80 85 102.7 temp, well appearing (9 organ systems with at least 2 bullets each)
HENT:  Normal
Eyes:  Normal
CV:  Normal
Respiratory:  Normal
GI:  Normal
Psychiatric:  Normal
Lymphatic:  Normal
Neurological:  Normal
Skin:  Edema, warmth, redness right leg, lines consistent with cellulitis, marked with skin marker.
Labs/Data:  None
Impression
  1. Cellulitis (4 points for new problem, further workup planned under the number of diagnosis for medical decision making
Plan
Start antibiotics. See orders.  (moderate risk for prescription drug management).
This patient meets criteria for a level one initial hospital encounter because it contains the minimum required medically necessary and reasonable elements for a level one initial hospital admission encounter but fails to rise to a level two or three for all three components.  Remember, for initial hospital encounters, the lowest level of documentation from history, physical and MDM determines the overall level of care.  The history is a level one history and the physical is a level 2/3 physical.    Medical decision making is moderately complex based on diagnosis (4 points makes = level 3) and risk table (prescription drug management = level 2).  Data  component of MDM provides no input variables.  This means the overall MDM is a level 2 as the highest two out of three for MDM is level 2.    Here's the quick look
  1. History (level 1)
  2. Physical (level 2/3)
  3. MDM (level 2)
Since the history is only a level 1 history, this initial hospital admission E/M encounter  would only rise to a 99221, 99218 or 99234, depending on which group of codes is appropriate for the patient's clinical scenario.  If the history failed to include 4 elements of HPI, this note would not qualify for any initial encounter code.  In fact, it would only qualify for a level two subsequent care note as even a level three subsequent care note (99233) requires 4 elements of HPI or the status of three chronic medical conditions.  This is why documentation is so important with E/M coding.

DISTRIBUTION OF HOSPITAL INITIAL CARE CODES 99221, 99218 AND 99234


What is the distribution of CPT® 99221, 99222 and 99223 for internal medicine in the country? One Medicare contract carrier actually showed us the results in a January, 2013 pdf presentation (based on January 2011 through December 2011 data). I was unable to find data on the other initial hospital care codes 99219 and 99235 for internal medicine exclusively.  However, I do provide data for all of these codes below on an all-comer basis. Here is their analysis for internal medicine.
  • 99221:  about 4% of total for these hospital initial visit codes. 
  • 99222: about 28% of total for these hospital initial visit codes.
  • 99223: about 68% of total for these hospital initial visit codes.
Notice how few times a level 1 initial hospital encounter visit is billed to Medicare. Most patients who are sick enough to be admitted into the hospital require a comprehensive history and physical exam.  To bill anything higher than a level one initial hospital encounter visit requires a comprehensive history and comprehensive physical.  That means if an E/M encounter does not contain at least 4 elements of the HPI (or documentation of the status of three chronic medical conditions), documentation from all three elements in  PFSH, documentation to support 10+ review of systems, and a physical exam that supports nine organ systems with 2 bullets each, the highest initial hospital encounter code that can be billed is a level 1!  Why am I able to document the things I did above and have it comply with E/M rules?  I have provided a list of these and other high impact E/M coding pearls at my lecture on level 3 hospital procedure codes 99223, 99220 and 99236.  I will not repeat those details here, but I recommend all readers review them at their convenience to understand their significance as they relate to the  progress note documentation example detailed above.  For example, writing normal on physical exam elements is allowed.  So is the notation for identifying when a complete review of systems has been performed.  These and other important coding pearls are detailed in the lecture linked above and their use, can simplify documentation requirements for the clinician.

One additional resource described the ten year trend (2001-2010) of E/M coding trends.   The OIG published a report in May, 2012 titled Coding Trends of Medicare Evaluation and Management Services.    As you can see, the proportion of 99221 vs 99222 vs 99223 has remained consistently constant over the last 10 years.  This data is for all Medicare E/M charges in this code group and not limited to internal medicine.  As you can see, in 2010, 55% of initial inpatient hospital care codes were 99223, 36% were 99222 and 9% were 99221.  Note, compared with the data above, internists as a whole bill at a higher intensity of service with 68% level three 99223 compared with 55% for all-comers in 2010.

Initial-Inpatient-Hospital-Care-10-Year-Coding-Trend-Table-2001-2010

In the same resource (on page 23), the OIG also published ten year E/M coding trends for the initial observation admission codes 99218-99220 and the admit and discharge same day codes 99234-99236.    This data is not exclusive to internal medicine.  A trend toward submitting higher intensity of service was observed.  The national distribution for  initial observation care codes in 2010 was 54% for 99220, 36% for 99219 and 11% for 99218.  For the admission and discharge same day codes, the 2010 data data showed the proportions as 40% for 99236, 41% for 99235 and 19% for 99234.

Admission-And-Discharge-Same-Day-Care-10-Year-Coding-Trend-E/M-Table-2001-2010-OIG

How often are CPT® codes 99221, 99218 and 99234 billed to Medicare?  Here is data from the most recent 2011 CMS Part B National Procedure Summary Files data (2011 zip file) showing how many CPT® 99221, 99218 and 99234 encounters were billed and the dollar value of their services for Part B Medicare.
  • 99221
    • Allowed services - 1,945,614
    • Allowed charges - $189,139,554.64
    • Payments - $148,287,703.97
99221-99223 National Procedure Summary File CMS 2011
  • 99218
    • Allowed services - 118,313
    • Allowed charges - $7,503,160.62
    • Payments - $5,778,527.97
99218-99220 National Procedure Summary File CMS 2011
  • 99234
    • Allowed services - 64,825
    • Allowed charges - $8,530,745.89
    • Payments - $6,610,587.44
99221-99223 Medicare Part B National Procedure Summary File 2011


RVU VALUE 


How much money does a CPT ® 99221, 99218 and 99234 pay in 2014?  That depends on what part of the country you live in and what insurance company you are billing.    All CPT® codes are paid in relative value units (RVUs).  I have previously discussed the complex nature of RVUs here.    Here are the raw RVU values and their dollar value in my geographical area:
  • 99221:  Work RVU 1.92.  Total RVU 2.85.  Dollar value of about $95
  • 99218:  Work RVU 1.92.  Total RVU 2.78.  Dollar value about $95
  • 99234:  Work RVU 2.56.  Total RVU 3.79.  Dollar value about $127.
I have provided a complete list of RVU values on common hospitalist E/M .  The 2013 RVU dollar value conversion rate is 35.8228.  I have my entire collection of E/M lectures organized here.  In addition, using my Google search engine embedded in the sidebar can help you find what you're looking for from The Happy Hospitalist.  I've tried to make this complex process as simple as possible to help others understand how important documentation is to stay compliant and to get appropriately paid for the work  provided.  It took me years of daily diligence and carrying my E/M pocket reference card around  with me at all times to get comfortable with medical billing and coding.  Remember, what code you bill is entirely dependent on how you document, not how much you document.



LINK TO E/M POCKET REFERENCE CARD POST


EM Pocket Reference Cards Using Marshfield Clinic Point Audit



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3 Outbursts:

  1. What are the criteria and payments for observation status vs admission status??

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  2. anon. The utilization review folks at your hospital can help you determine if the patient needs to be observation status. There are several giant books of rules that state what qualifies as an admission and what doesn't. My utilization folks let me know. If I admit a patient and they don't believe the hospital would get paid for a full admit, I change it to an observation status. Payment rates for docs for observation vs admission do vary. In my state a 99221 pays about $80. The equivalent 99218 pays $57. The observation discharge code 99217 pays about the same as a less than 30 minute discharge (99238) (about $60 for both). Other than screwing the doctor, I don't know why CMS would pay an observation status less, since it requires the exact same components as a full admit. It's hogwash.

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  3. After 10 frustrating years in the outpatient world, I have finally seen the light and joined a hospitalist group. I need some SERIOUS 411 on coding and appreciate your witty and informative blog. I have NO CLUE how to code obs patients. Please advise!!!

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