Current Procedural Terminology (CPT)

All billing and coding professionals will inevitably come across the term CPT, which refers to Current Procedural Terminology. CPT was and is developed by the American Medical Association (AMA) and is used today by all the major players in the health care system- medical providers, insurance companies, state and federal health care programs, and billing and coding professionals.

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The alert reader will be wondering why there is a need for CPT when there is the ICD (International Statistical Classification of Diseases), the subject of a previous entry. The answer is that although CPT is similar to the ICD, CPT is focused on identifying medical services provided. The ICD is used more as a code source for diagnosing.

The AMA reports its CPT is the most widely accepted coding system in both the private and public health insurance. Medical billing and coding professionals will need to be familiar with CPT codes and classifications when they are providing their services. Although many state, federal, and private insurance programs require submissions according to CPT, the AMA holds the copyright on this system of classification. Therefore, using CPT involves official sanction by the AMA, typically through licensing fees covered by health care providers.

The AMA maintains an ongoing consultation with field professionals and releases new and amended CPT versions on at least an annual basis. As of this writing the most current version is the 2014 edition of CPT-4.

CPT is structured into three primary categories:

  • Category I contains codes with six main procedural sections:
    • Evaluation and management
    • Anesthesia
    • Surgery
    • Radiology
    • Pathology and laboratory
    • Medicine
  • Category II codes: these are determined through a highly collaborative process with the major players in the health care industry, and are aimed at categorizing patient services. This section is currently comprised of 11 sections including:
    • Physical exams
    • Therapeutic and preventative measures
    • Patient management
    • Diagnosis or screening measures
    • Patient safety
  • Category III codes are reserved for procedures involving emerging technologies and concepts. These can include the latest advances in treatments derived from gene sequencing or stem cell research to new techniques resulting from the most recent advancements in the understanding of psychology and human behavior.

The AMA offers a variety of products through its website designed to make coding and classification according to the CPT more easily accessible for medical billing and coding professionals.

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CPT with Medicare and Medicaid

Medical billing and coding professionals who work with the federal Medicare and Medicaid programs will be familiar with the Healthcare Common Procedure Coding System (HCPCS). This is the system of classification/coding for reimbursement for services provided to patients covered under either of these two federal programs. HCPCS itself is divided into two subsystems: Level I HCPCS and Level II HCPCS.

As it so happens, Level I HCPCS uses the CPT-4 coding system developed by the AMA. This means billing and coding professionals who are already familiar with CPT should not have any problems creating or submitting claims that fall under the coverage of Medicare and Medicaid.

Level II HCPCS is a different story, and billing and coding professionals will have to learn the separate set of codes for these services which cover things like ambulance services and medical equipment such as orthotics and prosthetics.

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