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from Subsection 6A - Financial – Coding and Reimbursement
Published online by Cambridge University Press: 27 June 2025
General Medicare observation reimbursement guidelines for hospital (facility) services are reviewed. Tables on the Medicare observation Healthcare Common Procedure Coding System (HCPCS) codes, Current Procedural Terminology (CPT) private payer observation codes, Typical Medicare facility reimbursement rates, Medicare observation composite Ambulatory Payment Classifications (APCs) and reimbursement are included. This chapter contains a walk-through of the Centers for Medicare and Medicaid (CMS) requirements related to registration, documentation, charging, coding, and billing of facility observation services. Facility observation reimbursement, compliance oversight for observation services and condition code 44 are discussed. The scrutiny by Recovery Audit Contractors (RACs) focusing on one-day inpatient and observation stays is discussed.
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