Physicians, hospitals, accountable care organizations, and health plans are increasingly adopting value-based care (VBC) arrangements that aim to align physician payment with performance on quality, cost, and patient experience. Recently published AMA research shows that while fee for service remained the most common payment method for physician practices in 2024, complete reliance on fee for service is declining as more physicians report that their practices receive all revenue from alternative payment models (APMs).
Given the importance of the transition to value-based care, the AMA has also conducted extensive research, in collaboration with Manatt Health, examining how Current Procedural Terminology (CPT®) codes facilitate existing value-based care arrangements and can help accelerate further growth in adoption. These findings show that CPT codes serve as essential infrastructure for implementing and managing any value-based care payment model, including APMs.
“The landscape for value-based care has evolved, from experimentation to a more mature, digitally enabled ecosystem,” said Lori Prestesater, the AMA’s senior vice president of Health Solutions. “What we’re seeing now is a fundamental shift in how care is delivered, coordinated and measured, driven by technology, team-based models and a growing focus on modality-agnostic care to meet patients where they are.”
These transformative changes demand a corresponding evolution of health care resources, including significant expansion of the CPT code set to accommodate emerging care delivery approaches, she noted.
Below, we walk through how CPT codes currently enable the adoption of APMs and how the CPT code set is evolving to better meet the needs of the rapidly evolving market.
Patient attribution and population management
The foundation of APMs rests on accurate patient attribution—determining which patients fall under a health care organization's accountability. Through analysis of CPT-coded claims data, payers and physicians or other qualified health care professionals (QHPs) can implement sophisticated attribution methodologies, typically assigning patients based on their primary care utilization patterns.
“This process proves particularly valuable when determining the plurality of care delivery, a key factor in patient attribution that can only be assessed through careful analysis of CPT-based claims data,” Prestesater added.
Innovation in developing care bundles
Physicians and other qualified health professionals have undergone a digital transformation that has revolutionized patient-physician interactions, expanding them well beyond traditional office visits. Asynchronous communication platforms, remote-monitoring systems and other digital tools have created new possibilities for care delivery.
Meanwhile, digital health and medical device companies entering the market over the past decade have pioneered innovative care models that transcend conventional fee-for-service structures, requiring new approaches to service bundling and payment.
In a digitally enabled environment, existing and emerging health care organizations use CPT codes to develop comprehensive care bundles that reflect modern health care delivery. Such bundles encompass services delivered by diverse provider types, including physicians, nurses, coaches and peer supporters. They accommodate multiple care modalities, combining in-person visits with digital interactions, both synchronous and asynchronous. This flexible framework allows organizations to implement care models supporting frequent patient engagement without creating financial barriers through per-interaction copayments.
Streamlined contracting processes
The integration of CPT codes into alternative payment models facilitates efficient contracting between payers and health care organizations offering digitally enabled care. Rather than developing custom payment mechanisms for each new care delivery approach, organizations can use the existing payment infrastructure that relies on CPT codes.
“This standardization accelerates the contracting process and enhances payers' willingness to pilot innovative care models designed to improve outcomes,” Prestesater said.
The use of CPT codes also ensures these interactions become part of the broader claims-data ecosystem, supporting comprehensive analysis for cost-management and quality-improvement initiatives.
“This integration proves particularly valuable for organizations implementing new care delivery models, as it provides a familiar framework for documenting and analyzing novel approaches to patient care,” Prestesater noted.
How the CPT code set is evolving
The CPT code set continues to evolve in response to the shifting landscape of health care delivery and payment. In recent years, the CPT Editorial Panel has taken deliberate steps to support care models that prioritize coordination, outcomes and flexibility in how care is delivered.
Notably, the Panel approved foundational coding infrastructure for digital health services, including remote physiologic monitoring and remote therapeutic monitoring, enabling scalable reporting and payment for technology-enabled care outside the traditional clinic visit.
To ensure the code set continues to meet the needs of innovative, digitally enabled, and modality-agnostic care models, the CPT Editorial Panel launched a dedicated Value-Based Care Workgroup. This group is actively reviewing opportunities to modernize the code set to support longitudinal care, team-based delivery and evolving service types, laying the groundwork for broader adoption of high-value care.
“These additions reflect the code set's responsiveness to emerging care delivery patterns and payment models,” Prestesater said.
What lies ahead
As health care continues its value-based transformation, CPT codes serve increasingly strategic functions that go well beyond traditional service documentation. Health care organizations that are implementing APMs rely on CPT data to define and manage attributed patient populations, develop innovative care delivery approaches and establish efficient payment mechanisms. This data also supports comprehensive performance analysis, enabling health care organizations to refine their approaches to value-based care delivery continuously.
“As health care organizations advance their value-based initiatives, strategic use of CPT codes remains fundamental to success,” said Prestesater.
The continued evolution of the CPT code set will play a crucial role in supporting innovative care delivery models and payment arrangements, ultimately contributing to health care's broader transformation toward value-based care.
Learn more with the AMA-Manatt report, “Accelerating the adoption of value‑based care: The essential role of Current Procedural Terminology (CPT)” (PDF).
