Physicians providing services in the outpatient department of a hospital need to urgently review their place of service (POS) coding practices. As of October 1, 2012, CMS has implemented it's new place of service coding instructions per CR7631.

Billing for outpatient hospital procedures have come under the scrutiny of the Office of the Inspector General (OIG). The OIG has determined one of the most common POS coding errors is represented by the incorrect use of code 11,“office”, for services provided in the outpatient department of a hospital.

The CMS ruling instructs providers to use the place of service that represents the setting in which the beneficiary received the face-to-face service. Unless a provider has a separately maintained office space in the hospital or medical campus where the services was rendered, the POS is considered “outpatient hospital” and must show POS code 22.

You may wonder why using POS code 11 instead of 22 makes a difference. For services paid under the MPFS, there is a reduced reimbursement of procedures billed by providers in the outpatient hospital department. This reduction is based upon the facillity bearing the costs, such as support staff and equipment, that are required for the services to be rendered instead of the provider. Therefore, providers that incorrectly submit POS code 11 are being overpaid for their outpatient hospital procedures, and if audited, are subject to paying refunds to Medicare.

Take the time now to review the configuration of your physician billing system to ensure the POS codes that are being submitted for all of your service locations are set up correctly. Iridium Suite medical claims billing software is designed to contain a comprehensive table of all your practice service locations with built-in POS coding tied to each one. This is just one of the many ways in which Iridium Suite enables you and your staff to submit the most accurate and complete billing as possible.