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Observation Codes (new or established patients), 3 key components required.

Patient, who does not have an illness severe enough to meet acute inpatient criteria, does not need acute inpatient care but needs hospitalization. Further info about the severity can be obtained to determine if the patient can be treated on an outpatient basis. If patient admitted as outpatient then status updated to inpatient, services provided as outpatient are bundled into the initial inpatient hospital admission code.

Initial observation care codes

Used to designate beginning of observation status in a hospital. Observation admission can only be reported for the 1st day of service. Services performed in sites other than observation area (Dr. office, nursing home, etc.) and precede admission to observation status are included into the Initial Observation Care codes and not coded separately.

If patient is admitted to observation status then is ill enough to be admitted to the hospital, an Initial Hospital Care code not observation code is used to report the service (T/F)


Subsequent Hospital Care codes are used to report what information?

Used by physicians to report daily hospital visits while the patient is hospitalized.

Concurrent Care

More than one physician provides service to a patient on the same day for different conditions. Subsequent care codes can be used by several physicians, of different specialties, on the same day.

Attending Physician

Legally responsible for the care and treatment provided to the patient. Usually a provider of primary care.

Request for consultation

A physician asking for advice or an opinion (Requesting Physician)


Physician providing advice or consultation (would use consultation codes to report services)

Referral (as defined by 3rd party payers)

Total transfer of care of a patient. The physician accepting the referral would not use consultation codes.

Define consultation

Service provided by a physician whose opinion or advice regarding the management or diagnosis of a specific problem has been requested.

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