Can you explain Medicare’s policy regarding when an inpatient admission changes to outpatient?


Under the hospital Condition of Participation (CoP) at 42 C.F.R. §482.12(c), patients are admitted to the hospital or critical access hospital (CAH) as inpatients only on the recommendation of a physician or licensed practitioner permitted by the state to admit patients. In addition, every Medicare patient must be under the care of a physician or other type of practitioner listed in the regulation (“the practitioner responsible for care of the patient”). In some instances, a practitioner may order a beneficiary to be admitted as an inpatient, but upon reviewing the case, the hospital’s utilization review (UR) committee determines that an inpatient level of care is not medically necessary.

Taking this into consideration, the Centers for Medicare & Medicaid Services (CMS) obtained the following condition code from the National Uniform Billing Committee (NUBC), effective April 1, 2004:

Condition Code 44–inpatient admission changed to outpatient: For use on outpatient claims only, when the physician ordered inpatient services, but upon internal utilization review performed before the claim was originally submitted, the hospital determined that the services did not meet its inpatient criteria.


CPT® copyright 2021 American Medical Association (AMA). All rights reserved.

Fee schedules, relative value units, conversion factors and/or related components are not assigned by the AMA, are not part of CPT, and the AMA is not recommending their use. The AMA does not directly or indirectly practice medicine or dispense medical services. The AMA assumes no liability for data contained or not contained herein.

CPT is a registered trademark of the American Medical Association.