There are three rules that govern observation coding. Let’s use for example a case in which a surgeon admits a patient for observation at 9 p.m. and releases the patient the next day, at 1 a.m. Follow these three rules, and you will be all set. 1. If a physician admits a patient for observation and releases the patient on a different date of service, if the total duration of the observation stay is more than eight hours, you should report 99218-99220 with 99217. If a stay lasts multiple days, you may report one unit of 99218-99220 for each date of service, except the date when they physician discharges the …