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CPT Process – How a Code Becomes a Code
What is CPT?
Current Procedural Terminology (CPT®), Fourth Edition, is a listing of descriptive terms and identifying codes for reporting medical services and procedures. The purpose of CPT is to provide a uniform language that accurately describes medical, surgical, and diagnostic services, and thereby serves as an effective means for reliable nationwide communication among physicians, and other healthcare providers, patients, and third parties.
How is CPT used?
CPT descriptive terms and identifying codes currently serve a wide variety of important functions. This system of terminology is the most widely accepted medical nomenclature used to report medical procedures and services under public and private health insurance programs. CPT is also used for administrative management purposes such as claims processing and developing guidelines for medical care review.
The uniform language is likewise applicable to medical education and research by providing a useful basis for local, regional, and national utilization comparisons.
How was CPT developed?
The American Medical Association (AMA) first developed and published CPT in 1966. The first edition helped encourage the use of standard terms and descriptors to document procedures in the medical record; helped communicate accurate information on procedures and services to agencies concerned with insurance claims; provided the basis for a computer oriented system to evaluate operative procedures; and contributed basic information for actuarial and statistical purposes.
The first edition of CPT contained primarily surgical procedures, with limited sections on medicine, radiology, and laboratory procedures. The second edition was published in 1970, and presented an expanded system of terms and codes to designate diagnostic and therapeutic procedures in surgery, medicine, and the specialities. At that time, a five-digit coding system was introduced, replacing the former four-digit classification. Another significant change was a listing of procedures relating to internal medicine.
In the mid to late 1970s, the third and fourth editions of CPT were introduced. The fourth edition, published in 1977, represented significant updates in medical technology and a system of periodic updating was introduced to keep pace with the rapidly changing medical environment. In 1983, CPT was adopted as part of the Centers for Medicare and Medicaid Services (CMS), formerly Health Care Financing Administration's (HCFA), Healthcare Common Procedure Coding System (HCPCS). With this adoption, CMS mandated the use of HCPCS to report services for Part B of the Medicare Program. In October 1986, CMS also required state Medicaid agencies to use HCPCS in the Medicaid Management Information System. In July 1987, as part of the Omnibus Budget Reconciliation Act, CMS mandated the use of CPT for reporting outpatient hospital surgical procedures.
HIPAA and CPT
The Administrative Simplification Section of the Health Insurance Portability and Accountability Act (HIPAA)of 1996 requires the Department of Health and Human Services to name national standards for electronic transaction of health care information. This includes; transactions and code sets, national provider identifier, national employer identifier, security, and privacy. The FinalRule for transactions and code sets was issued on August 17, 2000. The rule names CPT (including codes and modifiers) and HCPCS as the procedure code set for:
• Physician services.
• Physical and occupational therapy services.
• Radiological procedures.
• Clinical laboratory tests.
• Other medical diagnostic procedures.
• Hearing and vision services.
• Transportation services including ambulance.
The Final Rule also named ICD-9-CM volume 1 and 2 as the code set for diagnosis codes, ICD-9-CM volume 3 for inpatient hospital services, CDT for dental services, and NDC codes for drugs.
All health care plans and providers who transmit information electronically are required to use established national standards by the end of the implementation period, October 16, 2003. In addition, all local codes have been eliminated and national standard code sets must be used after October 16, 2003.
Who maintains CPT?
The CPT Editorial Panel is responsible for maintaining the CPT code set. This panel is authorized by the AMA Board of Trustees to revise, update, or modify CPT codes, descriptors, rules and guidelines. The Panel is comprised of 17 members. Of these, 11 are physicians nominated by the National Medical Specialty Societies and approved by the AMA Board of Trustees. One of the 11 is reserved for expertise in performance measurement. One physician is nominated from each of the following: the Blue Cross and Blue Shield Association, America's Health Insurance Plans, the American Hospital Association, and the Centers for Medicare and Medicaid Services (CMS). The remaining two seats on the CPT Editorial Panel are reserved for two members of the CPT Health Care Professionals Advisory Committee (one co-chair "full seat" and one "rotating seat" member at-large).
Five members of the Editorial Panel serve as the panel’s Executive Committee. The Executive Committee includes the Editorial Panel chairman and co-chairman, and three panel members-at-large, as elected by the entire panel. One of the three members-at-large of the executive committee must be a third-party payer representative.
Supporting the CPT Editorial Panel in its work is a larger body of CPT advisors, the CPT Advisory Committee. The members of this committee are primarily physicians nominated by the national medical specialty societies represented in the AMA House of Delegates. Currently, the Advisory Committee is limited to national medical specialty societies seated in the AMA House of Delegates and to the AMA Health Care Professionals Advisory Committee (HCPAC), organizations representing limited-license practitioners and other allied health professionals. Additionally, a group of individuals, the Performance Measures Advisory Committee (PMAC), who represent various organizations concerned with performance measures, also provide expertise.
The Advisory Committees’ primary objectives are to:
1. serve as a resource to the CPT Editorial Panel by giving advice on procedure coding and appropriate nomenclature as relevant to the member’s specialty;
2. provide documentation to staff and the CPT Editorial Panel regarding the medical appropriateness of various medical and surgical procedures under consideration for inclusion in CPT;
3. suggest revisions to CPT. The Advisory Committee meets annually to discuss items of mutual concern and to keep abreast of current issues in coding and nomenclature;
4. assist in the review and further development of relevant coding issues and in the preparation of technical education material and articles pertaining to CPT; and
5. promote and educate its membership on the use and benefits of CPT.
How are suggestions for changes to CPT reviewed?
Specific procedures exist for addressing suggestions to revise CPT, adding or deleting a code, or modifying existing nomenclature.
First, AMA staff reviews all correspondence to evaluate coding suggestions.If AMA staff determines that the Panel has already addressed the question, staff informs the requestor of the Panel’s interpretation. However, if staff determines that the request is a new issue, or significant new information is received on an item that the Panel reviewed previously, the request is referred to appropriate members of the CPT Advisory Committee. If the advisors agree that no new code or revision is needed, AMA staff provides information to the requestor on how to use existing codes to report the procedure.
However, if all advisors concur that a change should be made, or if two or more advisors disagree or give conflicting information, the issue is referred to the CPT Editorial Panel for resolution.
In addition to the Advisory Committee opinions, current medical periodicals and textbooks are used to provide up to date information about the procedure or service. Further data is also obtained about the efficacy and clinical utility of procedures from other sources such as the AMA’s Diagnostic and Therapeutic Technology Assessment Program and various other technology assessment panels.
AMA staff prepares agenda materials for each CPT Editorial Panel meeting. The topics for the agendas are gathered from several sources. Medical specialty societies, individual physicians, hospitals, third-party payers and other interested parties may submit materials for consideration by the Editorial Panel. Panel members receive agenda material at least 30 days in advance of each meeting, allowing them time to review the material and to confer with experts on each subject, as appropriate.
The CPT Editorial Panel meets quarterly, addressing the complex problems associated with new and emerging technologies, as well as the difficulties encountered with outmoded procedures. The Panel addresses nearly 350 major topics a year, which typically involve more than 3,000 votes on individual items.
The Panel actions can result in three outcomes:
• add a new code or revise existing nomenclature, in which case the change would appear in a forthcoming volume of CPT;
• postpone/table an item to obtain further information; or
• reject an item.
A multi-step process naturally means that deadlines are very important. The deadlines for change requests and for Advisory Committee comments are based on a schedule which allows at least three months of preparation and processing time before the issue is ready to be reviewed by the CPT Editorial Panel. The initial step, which includes staff and specialty advisor review, is completed when all appropriate advisors have been contacted and have responded; and that all information requested of a specialty society or an individual requestor has been provided to AMA staff.
Further, the requestor must have completed and submitted a coding change request form. If the advisors’ comments indicate that action by the CPT Editorial Panel is warranted, a second step is then taken by AMA staff to prepare an agenda item that includes a ballot for the request to be acted upon by the CPT Editorial Panel. Once the Panel has taken an action and approved the minutes of the meeting, AMA staff informs the requestor of the outcome. If the requestor wishes to appeal the Panel’s decision, the following appeals process may be followed: AMA staff must receive a written request for reconsideration. The request must contain the reason the requestor believes that the Panel’s actions are incorrect, and should respond to the Panel’s stated rationale for taking the actions that it did. Once this information is received, the issue is referred to the CPT Executive Committee for a decision to reconsider. Unless new information becomes available, when a proposal is rejected for reconsideration, a second request for reconsideration will be entertained not less than one year after the first reconsideration. This request will also respond to the Panel's rationale, and supply those items requested by the panel for inclusion in the reconsideration request.
Category I CPT Codes
Category I CPT codes describe a procedure or service identified with a five-digit CPT code and descriptor nomenclature. The inclusion of a descriptor and its associated specific five-digit identifying code number in this category of CPT codes is generally based upon the procedure being consistent with contemporary medical practice and being performed by many physicians in clinical practice in multiple locations.
In developing new and revised regular CPT codes the Advisory Committees and the Editorial Panel require:
• that the service/procedure has received approval from the Food and Drug Administration (FDA) for the specific use of devices or drugs;
• that the suggested procedure/service is a distinct service performed by many physicians/practitioners across the United States;
• that the clinical efficacy of the service/procedure is well established and documented in U.S. peer review literature;
• that the suggested service/procedure is neither a fragmentation of an existing procedure/service nor currently reportable by one or more existing codes; and
• that the suggested service/procedure is not requested as a means to report extraordinary circumstances related to the performance of a procedure/service already having a specific CPT code.
Category II CPT Codes – Performance Measurement
CPT Category II codes are supplemental tracking codes that can be used for performance measurement. The use of the tracking codes for performance measurement will decrease the need for record abstraction and chart review, and thereby minimize administrative burdens on physicians and other health care professionals. These codes are intended to facilitate data collection about quality of care by coding certain services and/or test results that support performance measures and that have been agreed upon as contributing to good patient care. Some codes in this category may relate to compliance by the health care professional with state or federal law.
The use of these codes is optional. The codes are not required for correct coding and many not be used as a substitute for Category I codes.
Services/procedures or test results described in this category make use of alpha characters as the 5th character in the string (i.e., 4 digits followed by an alpha character). These digits are not intended to reflect the placement of the code in the regular (Category I) part of the CPT code set. Also, these codes describe components that are typically included in an evaluation and management service or test results that are part of the laboratory test/procedure. Consequently, they do not have a relative value associated with them.
Tracking codes for performance measurement are released biannually (January 1 and July 1) on the AMA CPT internet site, http://www.ama-assn.org/go/cpt and published annually in the CPT book as part of the general CPT code set. Codes released on January 1st are effective July 1st, allowing 6 months for implementation, and codes released on July 1st are effective January 1st.
Tracking codes are reviewed by the Performance Measures Advisory Group (PMAG), an advisory body to the CPT Editorial Panel and the CPT Health Care Professionals Advisory Committee (CPT/HCPAC). The PMAG is comprised of performance measurement experts representing the Agency of Healthcare Research and Quality (AHRQ), the American Medical Association (AMA), the Centers for Medicare and Medicaid Services (CMS), the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the National Committee for Quality Assurance (NCQA), and the Physician Consortium for Performance Improvement. The PMAG may seek additional expertise and/or input from other national health care organizations, as necessary, for the development of tracking codes. These may include national medical specialty societies, other national health care professional associations, accrediting bodies, and federal regulatory agencies. PMAG recommendations are then forwarded to the CPT/HCPAC Advisory Committee just as requests for Category I CPT codes are reviewed. The PMAG is interested in:
• measurements that have been developed and tested by a national organization;
• evidence-based measurements with established ties to health outcomes;
• measurements that address clinical conditions of high prevalence, high risk or high cost; and
• well-established measurements that are currently used by large segments of the health care industry
Category III CPT Codes – Emerging Technology
Category III CPT codes are a temporary set of tracking codes for new and emerging technologies. These codes are intended to facilitate data collection on and assessment of new services and procedures. The Category III codes are intended for data collection purposes in the FDA approval process or to substantiate widespread usage. As such, the Category III codes may not conform to the usual CPT code requirements for Category I. The Panel has established the following criteria for evaluating Category III code requests, any one of which is sufficient for consideration by the Editorial Panel: 1) a protocol for a study of procedures being performed; 2) support from the specialties who would use the procedure; 3) availability of U.S. peer-reviewed literature; 4) descriptions of current United States trials outlining the efficacy of the procedure.
These codes will be assigned a numeric-alpha identifier (eg, 1234T). These codes will be located in a separate section of CPT, following the "Category II" section. Introductory language in this code section explains the purpose of the Category III codes.
Since Category III CPT codes are intended to be used for data collection purposes to substantiate widespread usage or in the FDA approval process, they are not intended for services/procedures that are not accepted by the Editorial Panel because the proposal was incomplete, more information is needed, or the Advisory Committee did not support the proposal.
Once approved by the Editorial Panel, the newly added Category III CPT codes are released biannually (January 1 and July 1) on the AMA CPT internet site, http://www.ama-assn.org/go/cpt and published annually in the CPT book as part of the general CPT code set. Codes released on January 1st are effective July 1st, allowing 6 months for implementation, and codes released on July 1st are effective January 1st.
Category III CPT codes are not referred to the AMA /Specialty RVS Update Committee (RUC) for valuation because no relative value units (RVUs) will be assigned. Payment for these services/procedures is based on the policies of payers and local Medicare Carriers. However, the assignment of a CPT Category III code to a service does not indicate that it is experimental or of limited utility, but only that the service or technology is new and is being tracked for data collection. In the Final Rule for the 2002 Medicare Physician Fee Schedule (Federal Register, Thursday, November 1, 2001), the Center for Medicare and Medicaid Services (CMS) stated that they believed that Category III codes “will serve a useful purpose” and that payment for the service is at the discretion of the Carriers, but that the codes could be paid after entered into the computer systems. Local payment determination is reasonable for Category III CPT codes. It is not reasonable to categorically deny payment for CPT Category III codes since they are effectively more specific, more functional versions of unlisted codes which many payers cover with appropriate documentation. Once payment policies are established of a Category III Code, the need for documentation will be minimized since Category III Codes are associated with unique and specific descriptions of the service or procedure. Since Category III codes are part of the CPT code set, all health care payers must be able to accept Category III codes into their systems to comply with the standards for transactions and code sets under HIPAA.
These codes will be archived 5 years from the date of implementation, if the code has not been accepted for placement in the Category I section of CPT, unless demonstrated that a Category III code is still needed. These codes will not be reused.
How can I submit a suggestion for changes to CPT?
CPT’s effectiveness depends on constant updating to reflect changes in medical practice. Suggestions of physicians, medical specialty societies, state medical associations, and those who deal regularly with health care information are the only way to ensure that CPT reflects current practice. Accordingly, the AMA welcomes correspondence, inquiries, and suggestions concerning old and new procedures. Coding change request forms are available through the AMAand are required to initiate a review of a proposed coding change by the CPT Advisory Committee. These forms play a vital role in maintaining and increasing the efficiency of the CPT process.
Questions to answer before submitting suggestions for changes
Interested parties must answer several basic questions before submitting suggestions for changing CPT:
Is the suggestion a fragmentation of an existing procedure/service?
Generally, all the components of a procedure are included in the code for a procedure. For example, CPT code 58150 — Total abdominal hysterectomy (corpus and cervix), with or without removal of tube(s), with or without removal of ovary(s), includes all of the components listed if they are performed at that operative session. Requesting a new code for total abdominal hysterectomy (corpus and cervix), with removal of tubes would be an example of fragmentation. However, if the physician intended to perform an abdominal hysterectomy with bilateral salpingo-oophorectomy but only removed both tubes (bilateral salpingectomy), CPT code 58700 — Salpingectomy, complete or partial, unilateral or bilateral (separate procedure) would be used to report this component of what is normally considered an integral part of a total service.
To summarize, if there are several components of a procedure that are usually performed as part of that procedure, a separate code is not generally assigned for each component, unless the component is performed alone. Then separate procedure is indicated after that procedure.
In the example above, creating a code for total abdominal hysterectomy (corpus and cervix) with removal of tubes would fragment an existing procedure that already includes these components when they are performed as well as additional components (bilateral removal of ovaries).
Can the suggested procedure/service be reported by using two or more existing codes?
Certain procedures describe only a portion of a surgery performed, such as resection of a lesion or tumor. The procedure that is performed after the resection will vary, depending on the individual patient and the extent of the disease or other complicating factors. This may require reporting two or more procedure codes to completely indicate the services (procedures) performed to treat one problem.
Does the suggested procedure/service represent a distinct service?
CPT lists descriptive terms and identifying codes used to report medical services and procedures. Review the proposed coding change/addition. What does the actual service involve? If the only service provided is the review information stored in computers and does not require performance of a test, CPT code 99090 — Analysis of clinical data stored in computers (eg, ECG’s, blood pressures, hematologic data), can be used to report this analysis. While many sophisticated devices and equipment to perform procedures or provide services exist, CPT’s intent is to list those services/procedures in which actual work performance or direct supervision is required from a physician or practitioner. The device/equipment they use is not listed in the code.
Is the suggested procedure/service merely a means to report extraordinary circumstances related to the performance of a procedure/service already included in CPT?
A modifier indicates that a service or procedure performed has been altered by some specific circumstance but not changed in its definition or code.
For example, if a physician performed a cholecystectomy on a patient who was morbidly obese, a cholecystectomy would still be reported. The fact that the physician spent two additional hours performing the surgery (because of the complexity of the procedure due to the obesity) does not change the actual procedure being reported. The physician may add modifier 22 to the reported cholecystectomy code. The physician should attach a copy of the operative report or a narrative note to the claim form when submitting it to the third-party payer, indicating the additional work involved to perform this particular procedure.
If the answers to the preceding questions suggest a new descriptor/code is needed, you may submit your proposal by completing a coding change request form, which will require the following information:
• a complete description of the procedure/service (eg, describe in detail the skill and time involved. If this is a surgical procedure, include an operative report that describes the procedure in detail);
• a clinical vignette which describes the typical patient and work provided by the physician/practitioner;
• the diagnosis of patients for whom this procedure/service would be performed;
• a copy(s) of peer reviewed articles published in US journals indicating the safety and effectiveness of the procedure, as well as the frequency with which the procedure is performed and/or estimation of its projected performance; and
• a copy(s) of additional published literature which you feel further explains your request (eg, practice parameters/guidelines or policy statements on a particular procedure/service);
• evidence of FDAapproval of the drug or device used in the procedure/service if required.
Next, refer to the current section of the CPT to which you believe the proposed code/coding change relates. In your letter, provide the rationale to answer the following questions:
Why aren't the existing codes adequate? (Be very specific.)
What specific descriptors are you proposing? (Suggest wording for what you are proposing as well as placement of the proposed code(s) within the existing code range.)
• Can any existing codes be changed to include these new procedures without significantly affecting the extent of the services? (If not, give reasons why the existing codes are deficient.)
• Give specific rationale for each code you are proposing, including a full explanation on how each proposed code differs from existing CPTcodes.
• If a code is recommended for deletion, how should the service then be coded?
• How long (ie, number of years) has this procedure/service been provided for patients?
• What is the frequency in which a physician or other practitioner might perform the procedure/service?
• What is the typical site where this procedure is performed (eg, office, hospital, nursing facility, ambulatory or other outpatient care setting, patient’s home)?
• Does the procedure/service involve the use of a drug or device that requires FDAapproval?
Coding change request forms to introduce new procedures or to delete or revise procedure codes already in CPT are available at the AMA/CPT Web site http://www.ama-assn.org/ama/pub/category/3866.html or upon request from:
CPT Editorial Research and Development
American Medical Association
515 North State Street
Chicago, IL 60654
When are CPT codes implemented?
As the designated standard for the electronic reporting of physician and other health care professional services under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), CPT codes are updated annually and effective for use on January 1 of each year. The AMA prepares each annual update so that the new CPT books are available in the fall of each year preceding their effective date to allow for implementation.
Category I vaccine product codes, Category II, and Category III codes are typically “early released” for reporting either January 1 or July 1 of a given CPT cycle. In order to comply with HIPAA requirements, the effective dates for these codes have been altered to become effective six months subsequent to the date of release following code set updates. As a result, codes released on January 1st are effective July 1st, allowing 6 months for implementation, and codes released on July 1st are effective January 1st.
What other resources are available to me in using CPT codes?
The American Medical Association has many CPT related products. For a copy of the most recent CPT catalogue, please call (800) 621-8335. A copy will be sent to you promptly.
Content provided by: CPT Editorial & Info Services