Evaluating and managing hospital E/M services

Key components of E/M must be documented for every encounter.

The documentation required by Current Procedural Terminology (CPT©) for correct coding and billing of hospital evaluation and management (E/M) services is very complicated and fills the pages of many books. The associated contractual and regulatory requirements could fill many rooms. Still, a basic understanding of the rules, regulations and concepts governing these services can help guide hospitalists on this documentation journey.

The key components of E/M that determine the level of services provided and billable include history, physical exam and medical decision making (MDM), all of which must be documented for every encounter. While in some situations such components as time or coordination of care are the determinative factors, the three key components must still be documented. All documentation and signatures must be legible. Illegible notes are detrimental to patient care and safety; do not meet coding, legal or regulatory requirements; and can be a costly embarrassment if audited or presented in a courtroom.

Photo by Thinkstock
Photo by Thinkstock.

Inpatient and observation encounters are classified as initial or subsequent and are based on calendar days. One encounter may comprise multiple visits and progress notes on a single date. At least one visit must have all three key components. Day-of-discharge services have unique codes and criteria. Whether the patient is considered “new” or “established” does not apply to hospital services.

The initial encounter refers to the first time a physician sees a patient, as an attending physician or as a consultant. Most often this is at the initial history and physical exam (H&P). After that, visits with the patient by the same physician or any physician in the same hospitalist group are subsequent encounters. Other E/M codes, such as critical care and prolonged services as well as additional CPT© procedures or services, may be added to the basic E/M service if certain criteria are met.

For inpatient services, a specific order to “admit” the patient is required by Medicare regulations. Otherwise, payment for services may be denied.

In the academic setting, if teaching physicians wish to submit a claim for professional services, they may independently assess the patient, evaluate clinical data, review and annotate an intern's or resident's note, and authenticate it by signing. Of course, as an alternative, the teaching physician may perform a complete and separate H&P or progress note, but it is not a requirement.

Finally, most payors (including Medicare) no longer recognize consultation codes for inpatient services and do not pay for “comanagement” of patients—that is, two different physicians seeing and treating the patient for the same condition. Under Medicare regulations, only one clinician (usually the attending physician) will be paid for professional services on the same day if the first-listed diagnosis on claims submitted by more than one physician is the same. All physicians involved in a patient's care on the same day must communicate and agree upon the principal condition(s) for which each is billing.