Condition code 44 has been problematic for hospitals since its inception in 2004 due to CMS’ unclear language, multiple changes to the observation billing rules, and inconsistent guidance.
CMS has seen an increase in the number of extended observation stays and wants to know why. That was the reason it gave for holding an August 24 listening session regarding the matter. The reason providers misuse observation services may not have been as interesting as the solution proposed by some callers—namely, that CMS should abolish observation services.
