The CPT® code set and structure
Current Procedural Terminology (CPT) code: A standardized code that represents a specific medical service or procedure, maintained and updated by the AMA-convened CPT Editorial Panel. CPT codes are used by physicians, other qualified healthcare professionals (QHPs), payers, regulators, vendors, and healthcare technology organizations, wherever healthcare procedures and services need to be consistently reported—especially in documentation, reimbursement and operational workflows.
Category I CPT code: The most widely recognized and commonly used CPT codes, describing established procedures and services that meet a high standard of clinical evidence. Published annually and typically go through the RUC valuation process. Learn more.
Category III CPT code: Temporary CPT codes describing emerging medical technologies, procedures and services, used to collect data on utilization, effectiveness and clinical adoption to support a potential future conversion to Category I CPT codes. Published three times a year, effective for five years, and do not go through the RUC valuation process. Payment is determined by individual payer policy, and in most cases, Category III codes are not used for reimbursement by CMS or private payers. Learn more.
CPT Proprietary Laboratory Analyses (PLA) code: CPT PLA codes let labs or manufacturers identify their specific advanced diagnostic laboratory tests (ADLT) or FDA-cleared/approved clinical diagnostic laboratory tests (CDLT), especially where no Category I CPT code exists. Unlike Category III CPT codes, CPT PLA codes typically carry a real Medicare payment rate under the Clinical Laboratory Fee Schedule. Learn more.
Healthcare Common Procedure Coding System (HCPCS): A collection of codes and descriptors that represent procedures, supplies, products, and services that may be provided to Medicare beneficiaries and to the individuals enrolled in private health insurance programs.1
- HCPCS Level I: CPT codes and descriptors copyrighted by the American Medical Association. These are five-position numeric codes representing physician and nonphysician services.
- HCPCS Level II: Five-position alpha-numeric codes representing primarily items and nonphysician services that are not represented in the CPT code set, such as ambulance services or durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) when used outside a physician's office.2 HCPCS Level II also includes codes and descriptors copyrighted by the American Dental Association’s current dental terminology, seventh edition (CDT-7/8). These are five-position alpha-numeric codes comprising the D series. All other HCPCS Level II codes and descriptors are approved and maintained jointly by the alpha-numeric editorial panel (consisting of CMS, the Health Insurance Association of America, and the Blue Cross and Blue Shield Association).3
International Classification of Diseases, Tenth Revision, Clinical Modification (ICD-10-CM): A standardized system used to code diseases and medical conditions (morbidity) data. Physicians and other QHPs use ICD-10-CM codes when diagnosing patients. ICD-10-CM is an adaptation of ICD-10, copyrighted by the World Health Organization (WHO). The development and maintenance of this clinical modification is the responsibility of the National Center for Health Statistics (NCHS) as authorized by WHO.4
Modifiers: Two-position codes added to a CPT code to indicate that a special condition applied to the care provided, without changing the CPT code’s underlying definition.
Qualified healthcare professional (QHP): An individual who is qualified by education, training, licensure/regulation (when applicable), and facility privileging (when applicable) who performs a professional service within their scope of practice and independently reports that professional service.
Unlisted CPT codes: Can be used by physicians and other QHPs to document services that don’t have a specific CPT code. When an unlisted code is used, the service or procedure should be properly documented in the medical record.
The CPT Editorial Panel and code-change process
Code change application (CCA): How updates to the CPT code set are proposed. All CPT code change applications are reviewed and evaluated by the CPT/HCPAC Advisory Committee and the CPT Editorial Panel. All interested parties can submit comments on all applications.
CPT Editorial Panel (Panel): The independent body of physicians and other healthcare professionals convened by the AMA to ensure that CPT codes remain up to date and reflect the latest medical care provided to patients.
National medical specialty societies: Within the context of the CPT Editorial Panel process, medical specialty societies assign CPT Advisors who review all applications to the CPT Editorial Panel and provide comments. Specialties also play an important role in submitting CPT code change applications to the CPT Editorial Panel and in the subsequent survey process for Category I CPT codes going through the RUC process. In addition, many organizations may meet with potential applicants to help them consider next steps for their new technologies as they relate to CPT coding.
Payment and valuation policy
Alternative payment models (APMs): Payment approaches that deviate from traditional fee-for-service payment by incorporating additional factors such as quality measures, cost efficiency or patient outcomes.
AMA/Specialty Society RVS Update Committee (RUC): An independent group of volunteer physicians and other healthcare professionals that provides the federal government with recommendations on the resources needed for medical procedures and services. RUC recommendations are informed by input from thousands of healthcare professionals, and help ensure patient access to medical innovation by incorporating real-world, front-line perspectives into payment decisions. Learn more.
Centers for Medicare & Medicaid Services (CMS): The federal agency that provides health coverage to more than 160 million individuals through Medicare, Medicaid, the Children’s Health Insurance Program, and the Health Insurance Marketplace.5 CMS is the largest payer using the CPT code set, and RUC recommendations directly inform how CMS values clinician services on the Medicare Physician Payment Schedule.
Clinical Laboratory Fee Schedule (CLFS): Medicare’s payment system for laboratory tests described by Category I CPT codes or CPT PLA codes.6 New CPT PLA codes are typically priced through cross-walking or gap-filling, and advanced diagnostic laboratory tests (ADLTs) are priced based on the lab’s own reported private-payer rate.
Fee-for-service (FFS): A traditional payment methodology where physicians and other QHPs are reimbursed a predetermined amount for each individual medical service or procedure performed. Under this model, each service is typically identified by a specific code (such as CPT codes) and coverage for that service varies by payer.
Path to payment: The various reimbursement methodologies that healthcare payers use to determine compensation for medical procedures and services. These models range from traditional fee-for-service arrangements to complex value-based payment structures. In addition, the models provide a framework for new innovations to achieve clinical adoption, leading to sustainable business.
Payer: An entity that finances or reimburses healthcare services, including government programs (Medicare, Medicaid), private insurance companies, self-insured employers, and patients paying out-of-pocket. Health insurance payers establish coverage policies, negotiate reimbursement rates and process claims for medical services.
Relative Value Unit (RVU): RVUs are used to represent the value of resources needed to perform procedures and services described in the CPT code set. Each RVU accounts for the time, skill and intensity involved in delivering care, and together they create a relative ranking system known as the Resource-Based Relative Value Scale (RBRVS). Learn more.
Resource-Based Relative Value Scale (RBRVS): Physician payment system used by the Centers for Medicare & Medicaid Services (CMS) and most other payers that is structured to align payment for physician services with the resources required to provide them. Its goal is to help establish a consistent method of comparing procedures and to support the development and modernization of fee schedules or payment methodologies. Learn more.
Value-based care: A healthcare delivery and payment approach that rewards physicians and other QHPs for achieving positive patient outcomes and cost efficiency rather than the quantity of services provided.
Clinical AI and digital health
AI-enabled medical services: Healthcare services that incorporate artificial intelligence and machine learning technologies to enhance clinical decision-making, diagnostic accuracy, treatment planning, or operational efficiency.
Clinical effectiveness: The degree to which healthcare interventions, treatments or services produce desired patient outcomes under real-world clinical conditions.
Clinical utility: Whether using a test, device or algorithm’s output actually changes clinical management or improves patient outcomes, beyond simply being accurate.
Clinical validity: Whether a test or algorithm accurately measures or detects what it claims to measure or detect.
Clinically Meaningful Algorithmic Analyses (CMAA): A coding framework proposed by the CPT Editorial Panel’s Digital Medicine Coding Committee for algorithmic services that produce medically actionable outputs without physician or other QHP work at the point of care. As of this writing, CMAA is still in development and has not been finalized as a CPT code category.
CPT Appendix S / AI taxonomy: The CPT Editorial Panel’s guidance for classifying AI-enabled medical services and procedures, based on the work performed by the algorithm on behalf of the physician or other QHP: assistive (detects clinically relevant data for the physician or QHP to interpret), augmentative (analyzes data to produce a clinically meaningful output the physician or QHP interprets), or autonomous (analyzes data and produces a clinically actionable conclusion without physician or QHP interpretation). Learn more.
Digital health: The broad field encompassing the use of digital technologies to improve healthcare delivery, patient outcomes, and health system efficiency. This includes telemedicine, mobile health apps, wearable devices, electronic health records, health information exchanges, and other technology-enabled healthcare solutions.
Digital medicine: A subset of digital health that specifically focuses on evidence-based software and digital therapeutics used to prevent, manage, or treat medical conditions. This includes FDA-approved digital therapeutic applications, software as medical devices (SaMD), and clinically validated digital interventions that complement or replace traditional medical treatments.
Software as a Medical Device (SaMD): Software intended for one or more medical purposes without being part of a hardware device, subject to its own FDA regulatory pathway. SaMD products are a common entry point for companies pursuing CPT coding for digital medicine and clinical AI services.
U.S. Food and Drug Administration (FDA): The federal agency of the U.S. government that is responsible for protecting the public health by ensuring the safety, efficacy, and security of human and veterinary drugs, biological products, and medical devices; and by ensuring the safety of the nation’s food supply, cosmetics, and products that emit radiation. FDA clearance or approval is often a prerequisite for certain categories of CPT codes, including many Category I CPT codes and certain diagnostic tests that are eligible for CPT PLA codes.
1Centers for Medicare & Medicaid Services. HCPCS Code. Physician Supplier Procedure Summary Data Dictionary. data.cms.gov/resources/physician-supplier-procedure-summary-data-dictionary. Accessed Oct. 18, 2026.
2Centers for Medicare & Medicaid Services. Healthcare Common Procedure Coding System (HCPCS). www.cms.gov/medicare/coding-billing/healthcare-common-procedure-system. Accessed Oct. 18, 2026.
3Centers for Medicare & Medicaid Services. HCPCS Code. Physician Supplier Procedure Summary Data Dictionary. data.cms.gov/resources/physician-supplier-procedure-summary-data-dictionary. Accessed Oct. 18, 2026.
4U.S. Centers for Disease Control and Prevention. ICD-10-CM. www.cdc.gov/nchs/icd/icd-10-cm/index.html. Accessed Oct. 18, 2026.
5Centers for Medicare & Medicaid Services. About Us. www.cms.gov/about-cms. Accessed Oct. 18, 2026.
6Centers for Medicare & Medicaid Services, Medicare Learning Network. Clinical Laboratory Fee Schedule. www.cms.gov/files/document/mln006818-clinical-laboratory-fee-schedule.pdf. Accessed Oct. 18, 2026.
Disclaimer: This information does not supersede specific coding guidance published in the CPT codebook, which is subject to change and further modification by the CPT Editorial Panel. Establishment of a CPT code does not imply approval, endorsement, or sponsorship of the medical procedure or service by the AMA. A CPT code does not guarantee coverage, reimbursement, or payment. The AMA disclaims responsibility for any errors or omissions and for any consequences attributable to or related to any use, reliance, or interpretation of the information herein.
