Patient's Guide to Medical Codes

Medical codes are used to describe diagnoses and treatments, determine costs, and reimbursements, and relate one disease or drug to another.

Patients can use medical codes to learn more about their diagnosis, the services their practitioner has provided, figure out how much their providers were paid, or even to double-check their billing from either their providers or their insurance or payer. Learn more about these medical coding systems.

CPT Codes (Current Procedural Terminology)

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CPT codes are developed by the American Medical Association to describe every type of service (i.e., tests, surgeries, evaluations, and any other medical procedures) a healthcare provider provides to a patient. They are submitted to insurance, Medicare, or other payers for reimbursement purposes.

Patients may be interested in looking at CPT codes to better understand the services their doctor provided, to double-check their bills, or negotiate lower pricing for their healthcare services.

HCPCS Codes (Healthcare Common Procedure Coding System)

HCPCS codes are used by Medicare and are based on CPT codes. Patients who use Medicare, especially those who have needed ambulance services or other devices outside of the doctor's office, may want to learn more about HCPCS codes. There are two levels:

  • Level I HCPCS codes mirror CPT codes and are used to identify medical services and procedures ordered by physicians or other licensed professionals.
  • Level II HCPCS codes are alphanumeric and identify non-physician services like ambulance rides, wheelchairs, walkers, other durable medical equipment, and other medical services that don’t fit readily into Level I.

ICD Codes (International Classification of Diseases)

International Classification of Diseases (ICD) is published by the World Health Organization (WHO). This diagnostic classification system is the international standard for reporting diseases and health conditions. It uses death certificates and hospital records to count deaths, as well as injuries and symptoms.

ICD codes change over time, so they have a number appended to them to show which set of codes is being used. Introduced in the late 1970s, the ICD-9 code set was replaced by the more detailed ICD-10 code set on October 1, 2015. 

ICF Codes for Disabilities

The International Classification of Functioning, Disability, and Health, commonly known as ICF, is a framework for measuring health and disability related to a health condition. Where the ICD classifies disease, the ICF looks at how functional a person is in their environment.

Diagnostic Related Grouping (DRG)

The diagnostic-related group (DRG) system categorizes different medical codes. Hospital services are categorized based on a diagnosis, type of treatment, and other criteria for billing purposes.

This means that hospitals are paid a fixed rate for inpatient services corresponding to the DRG assigned to a given patient, regardless of what the real cost of the hospital stay was, or what the hospital bills the insurance company (or Medicare) for.

The assumption is made that patients that fit the same profile will need approximately the same care and services. There are about 500 different DRGs. They are updated annually to add new diagnoses or circumstances.

NDC Codes (National Drug Codes)

The NDC, or National Drug Code, is a unique, numeric identifier given to medications. The NDC is 10-digits divided into 3-segments. The first segment identifies the product labeler (i.e., the manufacturer, marketer, repackager, or distributor of the product). The second segment identifies the product itself (i.e., drug-specific strength, dosage form, and formulation). The third segment identifies the package size and type.

The code is present on all nonprescription (OTC) and prescription medication packages and inserts in the US. It should be noted that just because the number is assigned, that does not mean the drug has been approved by the FDA. The FDA publishes a list of NDC codes in the NDC Directory which is updated daily. If you are curious about the NDC for a drug you take, you can research it at the FDA website.

CDT Codes (Code on Dental Procedures and Nomenclature)

CDT Codes allow dentists to get into the coding act. The CDT Code, which refers to the Code on Dental Procedures and Nomenclature, is a set of procedural codes for oral health and related services.

DSM-IV-TR Codes for Psychiatric Illnesses

DSM-IV-TR codes are used to diagnose psychiatric illnesses. They are published and maintained by the American Psychiatric Association. DSM-IV-TR stands for Diagnostic and Statistical Manual of Mental Disorders, 4th Edition, Text Revision.

While you may see these codes in existing patient records, the 5th edition of the DSM was published in 2013 and recommends ICD-10 codes for psychiatric conditions. These also change over time, as there was a revision in October​ 2017.

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Article Sources
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  1. American Medical Association. CPT (Current Procedural Terminology). Updated 2019.

  2. Centers for Medicare & Medicaid Services. HCPCS - General Information. Updated November 8, 2019.

  3. Centers for Medicare and Medicaid Services. ICD-10: October 1, 2015.

  4. World Health Organization. International Classification of Functioning, Disability and Health (ICF). Geneva: World Health Organization; 2001.

  5. MedPac.gov. Hospital acute inpatient services payment system. Updated October 2018.

  6. U.S. Food and Drug Administration. National Drug Code Directory. Updated November 18, 2019.

  7. CDT 2020: Dental Procedure Codes. American Dental Association; 2019.

  8. American Psychiatric Association. Diagnostic and Statistical Manual of Mental Disorders, 4th Edition, Text Revision (DSM-IV-TR). American Psychiatric Association; 2000.

  9. American Psychiatric Association. Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition. Arlington, VA: American Psychiatric Association; 2013.