CPT Codes in Medical Billing

CPT (Current Procedural Terminology) codes are a standardized system developed and maintained by the American Medical Association (AMA). They cover a wide range of medical procedures, services, and tests performed by qualified healthcare professionals. CPT codes help healthcare providers submit accurate and detailed claims to insurance companies, government programs, and patients. CPT codes are also used to study health trends and patterns, understand how people use medical services, and develop healthcare documentation.

What Are CPT Codes?

All CPT codes have five characters and can be either numeric or alphanumeric. These codes offer a uniform language for describing medical services and procedures corresponding to Evaluation and Management, Anesthesia, Surgery, Radiology, Pathology and Laboratory, Medicine, and Genomic sequencing.

CPT codes ensure uniformity and clarity in communication between healthcare providers, insurers, and other entities. There are thousands of CPT codes and they are updated every year.

Types of CPT Codes

CPT codes are an integral part of the medical billing process. Each code provides an accurate description of a specific medical procedure or service such as a routine check-up, a surgical or nonsurgical procedure, a diagnostic test, or a therapy session. By capturing healthcare data accurately and consistently, CPT codes ensure that health claims are processed properly for Medicare, Medicaid, and other health programs.

CPT codes are divided into three categories. Category I comprises the most frequently used CPT codes and covers the majority of procedures rendered in both inpatient and outpatient settings, including hospitals. Category II codes serve as additional tracking codes primarily utilized for performance management. Category III codes are temporary and outline emerging and experimental technologies, services, and procedures.

Medical billing services primarily involve working with Category I codes to help healthcare providers report procedures or services to insurance.

• Evaluation and Management: 99202-99499
• Anesthesia: 00100-01999, 99100 – 99140
• Surgery: 10004 – 69990
• Radiology: 70010 – 79999
• Pathology and Laboratory: 80047 – 89398
• Medicine Services and Procedures: 90281 – 99607

Within each of these code fields, there are subfields that correspond to how that topic applies to a particular field of healthcare. For instance, under Anesthesia, codes 01916-01942 describe anesthesia for radiological procedures, codes 01951-01999 describe anesthesia services for burn excision/debridement, obstetrical, and other procedures, and codes 99151-99157 describe moderate (conscious) sedation services.

There are specific guidelines for the use of CPT codes in each field. For example, guidelines for Evaluation and Management (E/M) services have criteria for determining the level of service based on factors like: History (details about the patient’s symptoms, medical history, and reason for the visit), Examination (the extent of the physical examination performed), and Medical Decision Making (complexity of the decision-making involved in the patient’s care, including the nature of the problem, diagnostic procedures, and management options).

Each level of E/M service (e.g., office visits, hospital visits) has specific documentation requirements and criteria that must be met to assign the appropriate code. These guidelines help ensure accurate reporting of services rendered during patient encounters.

CPT Code Modifiers

CPT codes come with modifiers, which are two-digit additions to the code itself. These modifiers explain specific details about the procedure, like whether it was done bilaterally or if multiple procedures were performed simultaneously. CPT modifiers play a crucial role in ensuring precise coding. Here are some commonly used CPT modifiers:

25: Significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of the procedure or other service
26: Professional component
59: Distinct procedural service

Using CPT modifiers helps ensure providers receive accurate reimbursement for their services.

Medical Billing with CPT Codes

The coding process in medical billing begins with a qualified coder evaluating a patient’s records to translate the services and products provided to the patient into accurate codes in the medical report. Each procedure described by its CPT code and possibly, modifier, is accompanied by an ICD code that demonstrates the medical necessity. This report, which also includes the patient’s demographic information and medical history, is called the “superbill.”

The biller will then use the superbill to prepare the claim and submit it to the insurance company. The payer will use codes to process the claim and decide how much the healthcare provider should be reimbursed, and calculate the amount that the patient has to pay.

Procedures billed (CPT) must correspond to the medical necessity and diagnosis (ICD-10) for accurate claim submission. Local coverage determinations (LCD) outline the specific conditions where certain services are considered medically reasonable and necessary. Accurate coding according to LCDs is super important for compliance with payer policies. If the codes do not correspond, the provider would face a lot of claim denials.

Challenges of CPT Coding

Finding the right CPT code to report your services and adhering to coding guidelines and regulations while avoiding errors or fraudulent practices is crucial. However, this is not easy.

The CPT Editorial Panel makes additions, deletions, or revisions to existing codes every year. Staying current with these updates can be demanding and time consuming. Navigating these challenges requires ongoing education, attention to detail, and a comprehensive understanding of medical procedures and guidelines. Even a small error in CPT coding can lead to claim denials and reimbursement issues, impacting your practice’s payments.

Medical Necessity

Procedures billed (CPT) must correspond to the medical necessity and diagnosis (ICD-10) for accurate claim submission. Local coverage determinations (LCD) outline the specific conditions where certain services are considered medically reasonable and necessary. Accurate coding according to LCDs is super important for compliance with payer policies. If the codes do not correspond, the provider would face a lot of claim denials.

Coding Audits

Practices should implement regular coding audits to ensure that the coding accurately reflects the services provided to the patient.  This would catch any billing/coding errors which can lead to claim denials and financial loss. This would also identify potential undercoding or overcoding which can trigger an audit.  Sometimes, providers don’t maximize their reimbursement because they are not coding to the highest specificity.  This is based on RVUs which are a part of the Resource-Based Relative Value Scale (RBRVS), a system developed by CMS. This is used to determine reimbursement rates. When coders assign codes to the services provided by healthcare professionals, these codes are linked to RVUs. So, by understanding RVUs, coders ensure they use the right codes that match the complexity and effort involved in each service.

Continuing Education for Coders

Stay abreast of rules and changes so you don’t bill outdated codes. The CPT Editorial Panel makes additions, deletions, or revisions to existing codes every year. Staying current with these updates requires ongoing education, attention to detail, and a comprehensive understanding of medical procedures and guidelines.

Outsource: Overcome the Challenges of CPT Coding

Even a small error in CPT coding can lead to claim denials and reimbursement issues, affecting your practice’s payments. Finding the right CPT code to report your services and adhering to coding guidelines and regulations while avoiding errors or fraudulent practices is crucial.  However, this is not easy.

The best solution is to outsource the task to experts. Experienced AAPC certified coders in medical billing companies stay on top of the rules of CPT coding and will ensure that you assign codes to the highest level of detail and specificity.