FAQs: CPT® codes & health tech innovation

1. What is the CPT® code set?
2. How can I determine whether a code already exists for the procedure or service my product enables?
3. What are the different code sets and how do they interact with the CPT code set?
4. Which category of CPT code should I apply for?
5. What are the requirements for a CPT code?
6. Do CPT codes describe medical devices or equipment?
7. How are CPT codes valued?
8. How do CPT codes address digitally enabled services that span multiple modalities?
9. How are CPT codes used in Medicare health plans versus commercial health plans?
10. How can I apply for an AI-related CPT code?

What is the CPT® code set?

Current Procedural Terminology (CPT®), Fourth Edition, is a set of codes, descriptions and guidelines intended to describe procedures and services performed by physicians and other qualified health care professionals (QHPs), or entities. CPT codes do not describe diagnoses (ICD-10) or general tools, such as electronic health records (EHRs).

My company is developing a reimbursement strategy for a new device. How can I determine whether a code already exists for the procedure or service my product enables?

It is important to familiarize yourself with the code set and the guidelines to determine whether a code already exists for the procedure or service your product enables. Remember: the CPT code must accurately describe the procedure or service being performed, rather than approximate that procedure or service. When identifying an existing code for a procedure or service, all of the language within a code descriptor and its associated guidelines should be assessed. This includes information in the descriptor that may be enclosed in parentheses.

There are a number of resources available to help you familiarize yourself with existing CPT codes. The CPT® Professional Edition codebook is published once a year and contains the current, complete set of five-digit CPT codes, descriptors and official guidelines to code medical services and procedures properly.

Some sections of the CPT code set are published as PDFs on the AMA website. Category III CPT codes, a temporary set of codes and corresponding descriptors for emerging technologies, services and procedures, are released to the market biannually.

Another CPT resource of interest is CPT® Knowledge Base, a subscription database of over 4,000 commonly asked coding questions submitted from across the spectrum of specialties and answered by CPT experts, and you may find that your specific use case has been addressed in one of them! To start using CPT Knowledge Base, register or log in to select a package.

What are the different code sets that are used in health care, and how do they interact with the CPT code set?

There are several interrelated but distinct standardized code sets that are used in health care in the U.S. to facilitate communication between stakeholders.

Current Procedural Terminology (CPT) codes describe the service or procedure performed by a physician or other health care provider. CPT codes are the most widely accepted medical nomenclature used across the country to report medical, surgical, radiology, laboratory, anesthesiology, genomic sequencing and evaluation and management (E/M) services under public and private health insurance programs. In the Healthcare Common Procedure Coding System (HCPCS) coding system maintained by the Centers for Medicare & Medicaid Services (CMS), CPT codes are referred to as HCPCS Level I codes.

Diagnosis-related Group (DRG) codes classify hospital cases into groups that are expected to use similar resources, allowing hospitals to receive a fixed payment for treating patients with similar diagnoses. While CPT codes detail what was done during care, DRG codes use that information, along with diagnoses, to determine the overall payment for an inpatient hospital stay.

HCPCS Level II codes are used primarily to identify products, supplies and services not included in CPT codes, such as ambulance services or durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) when used outside a physician's office.

HCPCS G codes are procedural and service codes, but they are specific to the Medicare program.

International Classification of Diseases, 10th Edition (ICD-10) codes are diagnosis codes—identification classifications for why a patient shows up at the physician’s office or hospital. Both CPT and ICD-10 codes appear on a claim, but they are doing different things: CPT codes describe what procedures are performed and ICD-10 codes describe why.

Which category of CPT code should I apply for?

To support innovation at all stages and meet diverse data tracking needs, the CPT code set is structured into distinct categories:

Category I CPT codes are the most widely recognized and commonly used codes for established medical and laboratory procedures, services, and technologies. They are often covered by both public and commercial payers and must meet a high standard of clinical evidence.

Category II CPT codes describe performance measurements for quality-of-care tracking.

Category III CPT codes are temporary CPT codes used to track and report emerging medical technologies, procedures and services that do not yet meet the criteria for Category I status. These codes help collect data on utilization, effectiveness and clinical adoption to support potential future inclusion in Category I. A Category III code is good for five years, after which it can be renewed for an additional five years or requests can be made to convert it to Category I.

Administrative Multianalyte Assays with Algorithmic Analyses (MAAA) codes describe laboratory procedures that use results from assays of various types. Algorithmic analysis using these results is performed and reported typically as a numeric score or probability. MAAAs are typically unique to a single clinical laboratory or manufacturer.

Proprietary Laboratory Analyses (PLA) codes describe proprietary clinical laboratory analyses and can be either provided by a single ("solesource") laboratory or licensed or marketed to multiple providing laboratories that are cleared or approved by the Food and Drug Administration (FDA). This category includes but is not limited to Advanced Diagnostic Laboratory Tests (ADLTs) and Clinical Diagnostic Laboratory Tests (CDLTs), as defined under the Protecting Access to Medicare Act of 2014 (PAMA).

What are the requirements for a CPT code?

All code requests must meet general criteria for Category I and Category III CPT codes, as well as specific criteria designated for Category I codes and Category III codes. The CPT Editorial Panel uses these criteria to ensure alignment with the code set’s structure and nomenclature standards.

Do CPT codes describe medical devices or equipment?

The primary purpose of CPT codes is to describe the professional services or procedures that physicians or other qualified health care professionals provide. However, each Category I code typically has practice expenses associated with it. The practice expense component accounts for the clinical staff time, disposable supplies and medical equipment that can be attributed directly to the patient for that individual service when the patient receives it in the non-facility setting, such as the physician’s office. Therefore, CPT codes describe the medical devices and equipment that physicians use in their offices to deliver their professional services.

How are CPT codes valued?

Following each CPT Editorial Panel meeting, approved Category I codes are sent to the AMA/Specialty Society RVS Update Committee (RUC) to determine the appropriate resources associated with the procedure or service. These recommendations are then forwarded to CMS for ultimate determination in the yearly Medicare Payment Schedule.

How do CPT codes address digitally enabled services that span multiple modalities?

Over the past several years, the CPT Editorial Panel has significantly expanded the availability of digital medicine and telemedicine code options to address new care modalities such as remote clinician-to-clinician consultations and remote monitoring services for patient care. To help physicians navigate virtual care delivery, the AMA, in collaboration with Manatt Health, developed a digital medicine coding handbook that outlines CPT coding guidance for common digital medicine encounters.

CPT codes also support team-based care, to ensure that patients whose treatment needs require increased coordination across diverse care teams and specialties are fully supported in their health improvement journey. Medical team discussion, chronic and complex chronic care, principal care management for shorter-term coordination, and specialized service needs for behavioral health integration and psychiatric collaborative care are just some examples of team-based care supported by the CPT code set.

To better understand digitally enabled care used in value-based care, the AMA has also conducted research showing that physicians and other providers are looking for ways to provide and report modality-agnostic care. In other words, they want to provide care when the patient needs it, for however long they need it, with whatever device they need for treatment. The AMA and the CPT Editorial Panel are committed to reviewing ways to evolve the code set to support the delivery of high-value care to patients and meet the needs of physicians, health professionals, health systems, policymakers and payers.

How are CPT codes used in Medicare health plans versus commercial health plans?

As a uniform language of medicine embedded across the health care ecosystem, CPT codes are used the same way across health plans—to describe services and procedures performed. A payer may have separate coverage determinations, in which they want something specific in the documentation, but that doesn’t affect the codes themselves. By providing a single, trusted framework for describing clinical services, the CPT code set supports interoperability, thereby reducing administrative friction across the health care ecosystem.

How can I apply for an AI-related CPT code?

Overall, applications for AI-related CPT codes follow the same process as other medical services and procedures. If no existing codes accurately describe your AI-enabled service or procedure, you can submit a code change application (CCA) to request a new code or updates to an existing code through the CPT Smart App. Once in the application, you will be prompted to answer a few AI-specific questions about the service or procedure in addition to the standard questions. These AI-specific questions provide consistent data across code proposals for the CPT Editorial Panel to consider in their review process and help the Panel members to make informed and thoughtful decisions about AI applications in a quickly developing area of medicine.

At its September 2021 meeting, the CPT Editorial Panel accepted the addition of Appendix S to provide guidance for classifying various artificial intelligence/augmented intelligence (AI) applications. This guidance should be consulted for CCAs that describe work associated with the use of AI-enabled medical services and/or procedures.