Appeal type: Practitioner Services
Decision: Unfavorable

 
We decided that the Plan does not have to pay for procedure codes 99220 and 99226 provided on September 
30, 2022, and October 2, 2022. 
 
You asked the Plan to pay for procedure codes 99220 and 99226. You say that the medical records support the 
billing of procedure codes 99220 and 99226. The Plan denied your request. The Plan says the medical records 
do not support the billing of procedure codes 99220 and 99226. 
 
The Plan must follow Medicare rules. Medicare rules say that providers must report services correctly. 
Providers must report services with the appropriate CPT code. 
 
In this case, the CPT Code Manual definition of code 99220 is Initial observation care, per day, for the 
evaluation and management of a patient, which requires these 3 key components: A comprehensive history; A 
comprehensive examination; and Medical decision making of high complexity. Counseling and/or coordination 
of care with other physicians, other qualified health care professionals, 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 outpatient hospital "observation status" are of high severity. Typically, 70 minutes are spent at the bedside and on the patient's hospital floor or unit. The definition of code 99226 is Subsequent observation care, 
per day, for the evaluation and management of a patient, which requires at least 2 of these 3 key components: A 
detailed interval history; A detailed examination; Medical decision making of high complexity. Counseling 
and/or coordination of care with other physicians, other qualified health care professionals, or agencies are 
provided consistent with the nature of the problem(s) and the patient's and/or family's needs. Usually, the 
patient is unstable or has developed a significant complication or a significant new problem. Typically, 35 
minutes are spent at the bedside and on the patient's hospital floor or unit. 
 
We asked our coder to carefully review the case file and apply the relevant Medicare rules to determine if the 
Plan was correct in denying the request to pay for procedure codes 99220 and 99226. Our reviewer says that 
the medical records do not support the billing of procedure codes 99220 and 99226. Our reviewer found the 
history and physical (H and P) does not contain a comprehensive examination. As such, the billing of CPT 
code 99220 on September 30, 2022, is not supported. On October 2, 2022, the resident note contains a detailed 
examination, but no high-complexity medical decision making. Subsequent issues arose and were documented 
by the attending physician. These issues are noted to have been devoid of instability, and the associated 
medical decision making was problem focused. As such, the billing of CPT code 99226 is not supported. 
 
We looked at this coder's review, the file, and Medicare rules. Based on this information, we decided that 
Medicare rules for coverage of procedure codes 99220 and 99226 have not been met. Therefore, we decided 
that the Plan does not have to pay for procedure codes 99220 and 99226 provided on September 30, 2022, and 
October 2, 2022.