Q&A: Changing from inpatient to outpatient

Q. If the attending physician writes an admission order and later decides that the case should have been outpatient and then writes and order for outpatient, do we still need utilization review (UR) involvement and condition code 44 to change to observation?

A. The condition code 44 process was established by CMS in 2004 to allow the status of an inpatient to be changed to outpatient if the UR committee determines that the patient did not meet the regulatory requirements to be admitted as an inpatient. If a patient has been formally admitted as an inpatient pursuant to a valid admission order from a qualified practitioner then even if that same practitioner determines that the admission order was written in error, review by the UR committee is required.

That said, in a document published January 30, 2014, CMS stated:

“If the physician or other practitioner responsible for countersigning an initial order or verbal order does not agree that inpatient admission was appropriate or valid (including an unauthorized verbal order), he or she should not countersign the order and the beneficiary is not considered to be an inpatient. The hospital stay may be billed to Part B as a hospital outpatient encounter.”

This statement suggests that if that first admission order was given as a verbal order and was not authenticated by the physician, then the condition code 44 process is likely not needed. However, I feel there are regulatory and beneficiary rights issues that are violated with this statement and personally do not advise it be used.

Editor’s note: This question was answered by Ronald Hirsch, MD, FACP, CHCQM, of R1 Physician Advisory Services in Chicago.

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