What is a CPT Code in Medical Billing?

According to the Centers for Medicare & Medicaid Services, in the United States, insurers process over 5 billion healthcare claims a year.

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To be able to process all of these claims, healthcare professionals need to provide details on the services and procedures they provide.

Of course, there are many factors that go into making sure claims get processed, but one of the most important ones is for all organizations to understand the information provided. Especially insurance companies.

That is why the American Medical Association’s (AMA) published the Current Procedural Terminology (CPT) system for Medicare, Medicaid, and other healthcare programs.

Let’s look at what a CPT code is, the different types, and how it can help you collect on your revenue.

Current Procedural Terminology (CPT) is a fixed coding system that consists of both terms and identifying codes. These CPT codes are universally accepted medical vocabulary that are made up of 5 characters. Healthcare professionals use these codes to bill public and private insurance companies for the services and procedures they provide.

Making sure to accurately promote communication by adhering to this system can help with:
* Tracking healthcare utilization.
* Developing medical guidelines and other forms of healthcare documentation.
* Conducting research.
* Identifying the correct services for patients.
* Medical care reviews.
* And more

There is more than one type of CPT code and they can either be numeric or alphanumeric, depending on the service or procedure provided.
Let’s start with Category I CPT Codes. Medical coders will spend most of their time dealing with Category I CPT codes. These codes describe the medical procedures and services provided by healthcare professionals.

They exist in 6 separate sections, depending on which field of healthcare they pertain to:
* Anesthesiology
* Evaluation and Management
* Surgery
* Radiology
* Pathology and Laboratory
* Medicine

The introduction of new Category I codes is released annually.
Category II CPT Codes are known as supplemental tracking codes. Referred to as performance measurement codes, these alphanumeric codes collect data in relation to quality care. The code contains four digits, followed by the character F. These codes are not required, but are helpful for providing further information for future patient management.

Note that Category II codes never replace Category I or III codes. Category II CPT codes come out three times a year: in March, July, and November.
Next is Category III CPT Codes. These are temporary tracking codes, in an alphanumeric format, for new technologies within the medical field. This allows for better data collection as well as assessments of any new services or procedures. These codes collect information to help promote the widespread usage of new and emerging technologies. Ideally, these codes eventually move into the Category I section of CPT.

New Category III CPT codes come out twice a year, in January and July. These codes remain active for five years from the date of publication waiting for acceptance into Category I. If at the end of 5 years the code is still in Category III, the procedure must move to Category I as an “unspecified procedure” code.

Last are Proprietary Laboratory Analyses (PLA) Codes.

PLA codes describe proprietary clinical laboratory analyses. These codes can be either provided by a single laboratory or “sole source”. Or Licensed/Marketed to multiple laboratories approved by the Food and Drug Administration (FDA).

PLA codes include tests such as Advanced Diagnostic Laboratory Tests, Clinical Diagnostic Laboratory Tests, and more.

To ensure healthcare data is accurate, thus resulting in faster and more consistent revenue collection, a standardized coding system is essential. Knowing which codes to use and when can mean the difference between streamlining your revenue cycle and a high claim denial rate.

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