AI-generated ICD-10 and CPT codes from clinical notes — Medical Coding Online
E/M Code Categories
E/M codes cover a wide range of patient encounter types. Each category has its own set of codes, level definitions, and documentation requirements. Selecting the correct category is the first step in accurate E/M coding.
| Category | Code Range | Setting |
|---|---|---|
| Office/Outpatient — New Patient | 99202–99205 | Physician office, outpatient clinic |
| Office/Outpatient — Established Patient | 99211–99215 | Physician office, outpatient clinic |
| Hospital Inpatient — Initial Care | 99221–99223 | Hospital admission |
| Hospital Inpatient — Subsequent Care | 99231–99233 | Daily inpatient rounding |
| Hospital Inpatient — Discharge | 99238–99239 | Discharge day management |
| Emergency Department | 99281–99285 | Emergency department visits |
| Observation Care | 99234–99236 | Outpatient observation status |
| Nursing Facility | 99304–99318 | Skilled nursing and long-term care |
| Preventive Medicine | 99381–99397 | Annual wellness and preventive visits |
| Prolonged Services | 99417–99418 | Additional time beyond the highest level |
2025 Office E/M Level Selection: MDM vs. Time
Since January 2021, outpatient E/M level selection for established and new patients is based on either Medical Decision Making (MDM) complexity OR total time spent on the date of service. Physicians choose whichever method best reflects the work performed.
| E/M Level | New Patient | Est. Patient | MDM Level | Minimum Time (New) | Minimum Time (Est.) |
|---|---|---|---|---|---|
| Level 1 | 99202 | 99211 | N/A (nurse visit) | — | — |
| Level 2 | 99202 | 99212 | Straightforward | 15–29 min | 10–19 min |
| Level 3 | 99203 | 99213 | Low complexity | 30–44 min | 20–29 min |
| Level 4 | 99204 | 99214 | Moderate complexity | 45–59 min | 30–39 min |
| Level 5 | 99205 | 99215 | High complexity | 60–74 min | 40–54 min |
Medical Decision Making (MDM) Levels Explained
MDM complexity is determined by three elements. To qualify for a given MDM level, at least two of the three elements must meet or exceed the threshold for that level.
- Element 1 — Number and Complexity of Problems Addressed: minimal, low, moderate, or high
- Element 2 — Amount and/or Complexity of Data Reviewed and Analyzed: minimal/none, limited, moderate, or extensive
- Element 3 — Risk of Complications and/or Morbidity or Mortality: minimal, low, moderate, or high
- Straightforward MDM: 1 self-limited problem + minimal data + minimal risk
- Low MDM: 2 self-limited problems or 1 stable chronic condition + limited data + low risk
- Moderate MDM: 1 undiagnosed new problem or 1 chronic condition with exacerbation + moderate data + prescription drug management
- High MDM: 1 or more chronic conditions with severe exacerbation, or threat to life/limb + extensive data + high risk intervention
Hospital E/M Coding (2023 Guidelines)
Hospital inpatient and observation E/M codes were revised effective January 1, 2023, with new codes for combined inpatient/observation care (99223–99236) and updated MDM and time requirements matching the outpatient revisions.
- Initial hospital inpatient/observation care: 99221–99223 (straightforward to high MDM)
- Subsequent hospital inpatient/observation care: 99231–99233
- Hospital discharge management: 99238 (≤30 min), 99239 (>30 min)
- Time includes all time spent on the date of service — floor time, documentation, coordination
- MDM criteria mirror the outpatient 2021 guidelines
- Prolonged inpatient service: 99418 (each additional 15 minutes beyond the highest level)
Common E/M Coding Errors to Avoid
E/M coding errors are among the most audited issues in physician billing. Upcoding (billing a higher level than supported) and downcoding (billing lower than documentation supports) both have financial consequences — and upcoding carries compliance risk.
- Upcoding E/M level beyond what MDM or time supports
- Downcoding to avoid scrutiny — leaving revenue on the table
- Billing 99213 for every visit regardless of complexity
- Missing the -25 modifier when billing E/M on the same day as a procedure
- Not documenting the complexity elements that justify the selected level
- Using face-to-face time instead of total time for 2021+ time-based coding
- Billing a new patient code (99202–99205) for an established patient
How AI Selects the Correct E/M Level
AI-powered coding tools analyze clinical documentation to identify the appropriate E/M level based on MDM complexity or time documentation — reducing the guesswork and audit risk associated with manual E/M level selection.
- Identify the correct E/M category (new vs. established, outpatient vs. inpatient)
- Assess MDM complexity from clinical notes automatically
- Extract total time documentation when time-based coding is used
- Recommend the E/M code with a confidence score
- Flag modifier -25 when an E/M and procedure are billed same-day
- Reduce audit risk by ensuring documentation supports the selected level
Frequently Asked Questions
- What changed about E/M coding in 2021?
- Effective January 1, 2021, the AMA and CMS revised outpatient office visit E/M guidelines. The 3-component history/exam/MDM approach was replaced with a 2-component system: either Medical Decision Making (MDM) complexity or total time on the date of service. Documentation of a comprehensive history and physical exam is no longer required to support higher-level E/M codes.
- What is the difference between a new patient and an established patient for E/M coding?
- A new patient is one who has not received any professional services from the physician or another physician of the same specialty in the same group practice within the past 3 years. An established patient has received such services within the past 3 years. New patient visits generally have higher reimbursement rates and slightly higher time thresholds.
- Can I bill an E/M and a procedure on the same day?
- Yes, but you must append modifier -25 to the E/M code to indicate it is a significant, separately identifiable evaluation and management service performed on the same day as a procedure. The E/M must be above and beyond the pre-procedure assessment included in the procedure's global period, and the documentation must support both services separately.
- How do I use time-based E/M coding?
- For outpatient E/M visits (2021 guidelines), time includes all time spent by the physician on the date of service related to that patient — including documentation, ordering, reviewing results, and care coordination. It does not have to be face-to-face time. For a 99214 (established patient, moderate), the minimum total time is 30 minutes.
- What is the risk of incorrect E/M coding?
- Consistent upcoding (billing higher E/M levels than documentation supports) can trigger Medicare and commercial payer audits, resulting in recoupment of overpayments, education requirements, and in egregious cases, False Claims Act liability. Downcoding results in significant revenue loss over time. AI tools and regular internal coding audits help maintain compliant, accurate E/M level selection.