American College of Physicians: Internal Medicine — Doctors for Adults ®


Documentation of medical necessity, part three

The last in a three-part series

From the January ACP Hospitalist, copyright © 2013 by the American College of Physicians

By Richard Pinson, MD, FACP

Our last two columns in November and December 2012 discussed clinical indicators of inpatient medical necessity for patients admitted with certain problematic, high audit-risk conditions. This month's column is the third in this series and completes that discussion.

“Medical necessity” is a vague standard, subject to broad interpretation based on clinical practice and judgment. Essentially, it means an illness must be severe enough, and the required services intense enough, that care can only be given safely and effectively in the hospital.

Photo by Thinkstock.

Photo by Thinkstock.

To provide some objective guidance, industry-standard guidelines have been developed over the past 30 years based on medical literature and professional practice guidelines. The most recognized and frequently used are the InterQual and Milliman criteria, which have been validated by research and decades of clinical use. These guidelines are intended to be used as screening tools, so clinical judgment with supporting documentation of medical necessity should take precedence. They are not intended as clinical practice standards of care or replacements for physician judgment and expertise.

Some typical parameters for inpatient medical necessity in common problematic conditions are discussed below.

Acute chest pain, acute coronary syndrome (ACS), acute myocardial infarction (AMI)

The evaluation and management of patients with these problems poses clinical and documentation challenges. Rapid technologic advances have changed both pathophysiologic understanding and expectations for a setting that provides effective care and sufficiently regards patient safety.

Patients presenting with acute chest pain represent a group with high risk but low frequency of potentially life-threatening conditions. No one wants to “miss” or delay treatment for unstable angina or AMI (whether ST-elevated MI [STEMI] or non-ST-elevated MI [NSTEMI]). Current guidelines indicate that most patients who need immediate evaluation of chest pain can be managed initially in observation if all of the following criteria are met:

  • Chest pain relieved prior to admission orders
  • Vital signs stable
  • Electrocardiogram (EKG) showing no significant findings or unchanged from prior EKG
  • Unremarkable chest X-ray for acute disease
  • Normal cardiac markers, especially troponin level in non-ischemic range

Documentation of only “atypical” or “nonspecific” chest pain, “angina,” or “rule out MI” does not support inpatient admission.

On the other hand, the following confirmed or suspected findings clearly justify inpatient care, assuming that clinicians provided aggressive recommended management consistent with the diagnosis:

  • “ACS” with left bundle branch block (new or undetermined age)
  • Significant EKG changes of:

In other, less certain cases, it is essential to document your clinical reasoning for, and management plans requiring, an inpatient admission. Keep in mind that “unstable angina” is a key diagnostic term that supports inpatient status whenever characterized by increasing severity, duration, frequency, or intensity. Also, for coding purposes, ACS is considered simply “unstable angina,” so if an NSTEMI is suspected, it needs to be documented. This is most confusing when the significance of an elevated troponin level goes unclarified.

Any reference to actual or suspected cardiac ischemia in conjunction with acute congestive heart failure, syncope, hypertensive crisis or aortic stenosis implies inpatient care is needed.

Remember that the patient must require the currently recommended management for serious, potentially life-threatening unstable angina or ACS to support an inpatient admission with these diagnoses. Anything less implies he or she could be managed in observation.

Bronchospastic conditions

The inpatient clinical criteria for asthma, chronic obstructive pulmonary disease (COPD) exacerbation or other causes of acute bronchospasm are well delineated. The following would typically qualify for inpatient admission:

  • Failed outpatient management for two or more days
  • Peak expiratory flow (PEF) <40% at any point
  • PEF <80% and lack of response to three doses of inhaled short-acting beta-agonist
  • Room air pO2 less than 60 mm Hg or pulse oximetry less than 90%
  • Arterial blood gas (ABG) showing pCO2 greater than 50 mm Hg and/or pH less than 7.30

Otherwise, unless the reason for inpatient care is clearly identified, observation care would usually be expected.

It is common to miss the opportunity to obtain room air pulse oximetry or ABG, as well as the necessary PEF measurements before and after three doses of short-acting beta-agonists. PEF can easily be measured at the bedside by a nurse or respiratory therapy professional using a simple, hand-held, peak-flow meter. These assessments are important quality-of-care indicators and management tools; it is most important to provide these during the initial emergency department presentation and management of patients.

The expected medically necessary inpatient care includes, at a minimum:

  • Supplemental oxygen with pulse oximetry or ABG
  • Bronchodilator nebulizer (including metered dose inhaler) every four hours or more
  • Corticosteroids given orally, or intravenously three times per day


Always be sure to document your clinical reasoning for an inpatient admission with specific reference to the clinical findings that support your decision. If you honestly expect the patient to require more than 24 hours of inpatient care, document this fact and ensure that such inpatient services are actually provided. When the case for inpatient medical necessity is weak, it may be prudent to use observation care before finalizing an admission decision, especially if advice from case management will later be available.

Richard Pinson, MD, FACP, is a certified coding specialist and cofounder of HCQ Consulting in Houston. This content is adapted with permission from HCQ Consulting.



Ask Dr. Pinson

Q: I work as a hospitalist in upstate New York. Our hospitalist group rounds on inpatient floors and ICU patients and does admissions in the emergency department (ED). I have a few questions. First, if an ED doctor gives an admission to a hospitalist, but the hospitalist sees the patient and the patient wants to leave the ED before admission, who discharges the patient: the ED doctor or the hospitalist? And, if it is the hospitalist doing the discharge, is it coded as regular discharge (239, 238, 237), a consult (254, etc.), or an ED visit?

A: It may depend on interdepartmental policy, but if the hospitalist is called by the ED physician to see the patient, performs the three key components of an E/M service, and the patient is discharged, one would expect the hospitalist to have assumed care of the patient and make the discharge arrangements. In this case, the Centers for Medicare and Medicaid Services (CMS) instructs both the ED physician and the hospitalist to file claims using the ED service codes (99281-99285). CMS no longer accepts consultation codes. Other payers may have a different policy, but they tend to follow CMS’ lead.

Q: If the above patient wants to sign out against medical advice (AMA) in the ED a few hours after the hospitalist has already admitted the patient in the ED, should the hospitalist provide prescriptions and fill out all discharge papers like a regular discharge? What will be the coding for that same day? Will it be for an admission or discharge, and does the hospitalist need to re-dictate for a discharge/AMA, when an admission history and physical was already dictated?

A: Similar to the answer above, the hospitalist has assumed care of the patient and thus would make discharge arrangements. As for coding, CMS regulations indicate that the patient is admitted when the inpatient order is written and executed. So, assuming that the three key components of an E/M service are performed and discharge takes place on the same date, the “Observation or Inpatient Care Services (Including Admission and Discharge Services),” codes 99234-99236, would be appropriate, not the emergency department code. The hospitalist should perform, manage and document the admission and the discharge circumstances. If the H&P was already dictated, a brief discharge note could be written or dictated supplementing the H&P.

Got a coding question? E-mail us.


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