Outpatient hospital services are those services provided to a person who has not been admitted by the hospital as an inpatient but is registered on the hospital records as an outpatient and receives services from the hospital.
Charges for observation time must be submitted on a CMS-1450 (UB-04) claim form via eMOMED using revenue code 0762 with procedure code G0378 and the actual number of hours the participant was in observation as units billed. Hospitals should round to the nearest hour. Observation time ends when all medically necessary services related to observation care are completed. Observation care may end prior to discharge if other medically necessary services do not meet the definition of observation care or when the patient is admitted inpatient or discharged. Do not include the time participants remain in the hospital after treatment has finished in the observation time when submitting the claim.
Direct admit to observation (G0379) is not payable by MHD as it is considered included in the payment for hospital observation per hour (G0378). Refer to the Observation Time section of the Hospital Manual for further information.
If the observation time exceeds 24 hours, only one (1) observation code (G0378) may be billed. If the hospital has a patient in an observation room for more than 24 hours, the additional observation hours must be absorbed as an expense to the hospital. Those charges cannot be billed to MHD or the participant. Although, diagnostic and procedural services provided to participants who remain in observation status after the 24-hour period of observation has expired can be billed to MHD. These charges must not be submitted on the same claim with the observation units (G0378) of up to 24 hours. A separate claim must be submitted for diagnostic and procedural services provided after the initial 24 hours of observation. Do not include additional observation hours on this claim, as MHD will only reimburse up to 24 hours. After the 24 hours of observation have been exhausted, all diagnostic and procedural services must have the necessary authorizations before services are rendered.
Refer to the Fee Schedules for a list of procedures that require prior authorization.
If the stay spans past midnight, only one (1) date of service is billed, which is the date the patient was placed in observation status. For example, the patient was placed under observation on 1/1/24 at 4:00 p.m. and discharged/admitted to inpatient on 1/2/24 at 6:00 a.m. The claim should be submitted for date of service, 1/1/24, with revenue code 0762, procedure code G0378, and 14 units. Refer to the Outpatient Hospital Services Exceeding 24 Hours section of the Hospital Manual for further information.
MO HealthNet Division’s policy on observation is different than Medicare’s policy. Refer to section 20.6 of the Medicare Benefit Policy Manual for Medicare’s policy.