Place of Service code (POS)
Place of Service (POS) codes are two-digit numeric identifiers on the CMS-1500 claim form that tell payers where a healthcare service was delivered. CMS maintains the official POS code set. The POS code directly affects reimbursement: the same CPT code typically pays a different amount depending on whether the service was delivered in an office (POS 11), an off-campus outpatient hospital (POS 19), an on-campus outpatient hospital (POS 22), urgent care (POS 20), or a telehealth setting (POS 02 or POS 10). Using the wrong POS code is a billing error that changes how much you collect.
Why this matters for your clinic
POS codes directly drive reimbursement rates. Medicare pays more for the same CPT code in a non-facility setting (like a physician office, POS 11) than in a facility setting (like an on-campus outpatient hospital, POS 22, or off-campus outpatient hospital, POS 19) because in a facility setting the facility separately bills for its overhead. Billing the wrong POS code means collecting at the wrong rate, which is either an underpayment or a compliance risk depending on which direction the error runs.
Telehealth POS codes are the highest-error category in 2026. CMS introduced POS 10 (telehealth provided in the patient's home) alongside the existing POS 02 (telehealth not provided in the patient's home) effective January 2022. POS 02 vs POS 10 each trigger different reimbursement rates. Many billers still default to POS 02 for all telehealth, which causes denials when the patient is at home.
For multi-location practices, POS code discipline is a quality control issue. If providers are billing from an off-campus outpatient hospital but using POS 11, or billing telehealth with the wrong place of service code, systematic payment errors accumulate before anyone catches them. Regular POS code audits by service type and location are part of a healthy billing quality program.
What good looks like
CMS publishes the complete Place of Service code set on its website, including effective dates for each code. The POS code list is updated periodically. For telehealth, CMS issues updated guidance in each annual Physician Fee Schedule final rule, which takes effect January 1 of the following year.
Example
A physician group operates both an independent office and a hospital-based outpatient clinic. Services at the independent office should use POS 11. Services at the hospital-based clinic should use POS 22. If the billing team defaults all claims to POS 11, the hospital-based services are billed at the higher non-facility rate. Medicare will either recoup the difference on audit or flag the claims for review. Conversely, if the independent office uses POS 22 by mistake, the practice undercollects the facility premium it is legitimately entitled to.
Side-by-side
| POS code | Description | Setting type | Common use |
|---|---|---|---|
| 02 | Telehealth Provided Other Than in Patient's Home | Facility/non-facility (varies) | Telehealth from a clinic, originating site, or rural health site |
| 03 | School | Non-facility | School-based health services |
| 04 | Homeless Shelter | Non-facility | Shelter-based care |
| 09 | Prison/Correctional Facility | Non-facility | Inmate care |
| 10 | Telehealth Provided in Patient's Home | Facility (Medicare) | Telehealth with patient at home (since Jan 2022) |
| 11 | Office | Non-facility | Most common — independent clinic, default POS |
| 12 | Home | Non-facility | Provider visits patient's residence |
| 13 | Assisted Living Facility | Non-facility | Care delivered in assisted living |
| 14 | Group Home | Non-facility | Group home care |
| 19 | Off Campus Outpatient Hospital | Facility | Hospital-affiliated outpatient clinic NOT on the main campus |
| 20 | Urgent Care Facility | Non-facility | Walk-in urgent care |
| 21 | Inpatient Hospital | Facility | Hospital admissions |
| 22 | On Campus Outpatient Hospital | Facility | Hospital outpatient department on main campus |
| 23 | Emergency Room — Hospital | Facility | ER visits |
| 24 | Ambulatory Surgical Center | Facility | Outpatient surgery |
| 31 | Skilled Nursing Facility | Facility | SNF care (Medicare Part A) |
| 32 | Nursing Facility | Non-facility | Long-term nursing care |
| 49 | Independent Clinic | Non-facility | Freestanding non-physician clinic |
| 50 | Federally Qualified Health Center | Non-facility | FQHC services |
| 53 | Community Mental Health Center | Facility | CMHC behavioral health |
| 65 | End-Stage Renal Disease Treatment Facility | Facility | Dialysis |
| 71 | State or Local Public Health Clinic | Non-facility | Public health services |
| 72 | Rural Health Clinic | Non-facility | RHC services |
| 81 | Independent Laboratory | Facility | Lab-only services |
| 99 | Other Place of Service | Varies | Settings not otherwise classified |
From Sorso
POS code errors at the payer system level tend to stay invisible until there is an audit or a contract review. We include a POS code spot-check in every billing review we conduct because the financial impact can be significant and the fix is usually a simple workflow correction.
Founder of Sorso. 19 years in corporate finance. Managed a $450M loan portfolio before building a fractional CFO firm exclusively for healthcare clinics.
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