Since the Centers for Medicare & Medicaid Services (CMS) stopped recognizing consultation codes (99241–99245; 99251–99255) in January 2010, there have been conflicting guidelines for reporting observation and hospital care services.

A comparison of Current Procedural Terminology (CPT®) and CMS guidelines for reporting initial and subsequent observation and hospital care was first presented in the May 2011 AAP Pediatric Coding Newsletter™ (volume 6, number 8) ("One Patient, 2 Physicians"). However, CPT 2012 included revisions to observation codes and new guidelines for reporting those services with prolonged care service codes. In addition, in August 2011, the CMS revised its Medicare policies addressing reporting observation care and prolonged physician services. The CMS policy changes were published on August 26, 2011, in Transmittal 2282, and can be found at or in the Medicare Claims Processing Manual, Chapter 12, section 30.6.8A and 30.6.10 (

It is important to understand...

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