What Are CPT Codes?

Current Procedural Terminology (CPT) codes are numbers assigned to each task and service a healthcare provider offers. They include medical, surgical, and diagnostic services. Insurers use the numbers to determine how much money to pay a provider.

Everyone uses the same codes to ensure uniformity. CPT codes are used to track and bill medical services.

They are similar to, but not exactly the same as, codes from the Healthcare Common Procedure Coding System (HCPCS). If you use Medicare, you'll see HCPCS codes in your paperwork instead of CPT codes.

Understanding CPT Codes

A CPT code is a five-digit numeric code. It has no decimal marks. Some have four numbers and one letter.

Codes are assigned to different actions. Some may be used from time to time or not at all. Others are used often. For example, 99213 and 99214 are general check-ups.

CPT codes are developed, maintained, and copyrighted by the American Medical Association (AMA). As health care changes, new codes are assigned to new services. Current codes may be revised and old, unused codes thrown out. Thousands of codes are used and updated every year.

The codes don't mean that everyone defines a service the same way. They also don't ensure that different healthcare providers get paid the same amount for a service. Those things are outlined in the contracts between providers and insurers.

For example, Healthcare Provider A may perform a physical check-up (99396) and be paid $100 by your insurance company. If you went to Healthcare Provider B, the payment for that same CPT code might only be $90.

Categories

There are several categories of CPT codes, including:

• Category I: Procedures, services, devices, and drugs, including vaccines
• Category II: Performance measures and quality of care
• Category III: Services and procedures using emerging technology
• PLA codes, which are used for lab testing

Examples

Here are some examples:

• 99214 may be used for an office visit
• 99397 may be used for a preventive exam if you are over 65
• 90658 indicates a flu shot
• 90716 may be used for the chickenpox vaccine (varicella)
• 12002 may be used when a healthcare provider stitches up a 1-inch cut on your arm

Some CPT codes indicate bundled services. That is, one code describes several services performed together.

How CPT Codes Are Used

CPT codes directly affect how much a patient will pay for medical care. For that reason, offices, hospitals, and other medical facilities are strict about how coding is done. They usually hire professional medical coders or coding services to make sure services are coded correctly.

Initial Coding

Your healthcare provider or their office staff will usually start the coding process. If they use paper forms, they will list which CPT codes apply to your visit. If they use an electronic health record (EHR) during your visit, it will be noted in that system. Systems usually allow staff to call up codes based on the service name.

Verification and Submission

After you leave the office, medical coders and billers examine your records. They make sure the correct codes are assigned.

The billing department then submits a list of your services to your insurer or payer. Most healthcare providers store and transfer this information digitally. Some may still be done by mail or fax.

Claim Processing

Your health plan or payer then uses the codes to process the claim. They decide how much to pay your healthcare provider and how much you may owe.

Research

Health insurance companies and government officials use coding data to predict future health care costs for the patients in their systems. State and federal government analysts use coding data to track trends in medical care. This information helps to plan and budget for Medicare and Medicaid.

Where You Will See CPT Codes

You'll see CPT codes in many different documents as you move through a health care experience.

Discharge Paperwork

As you leave an appointment or are discharged from a facility, you receive paperwork. It includes a summary of the services you had, including the codes.

The five-character codes are usually CPT codes. There are other codes on that paperwork, too. These include ICD codes, which may have numbers or letters. These usually have decimal points.

Bills

When you receive a medical bill, it will have a list of services. Next to each service will be a five-digit code. That's usually the CPT code.​

Explanation of Benefits

When you receive an explanation of benefits (EOB) from your payer, it will show how much of the cost of each service was paid on your behalf. Each service will be matched with a CPT code.

Matching CPT Codes to Services

If you want to know more about these codes, it could be because you're analyzing your healthcare providers' and insurance billings. CPT codes are copyrighted by the AMA. The AMA charges fees to use the codes. That means you won't find a full list with explanations online for free.

To make them more accessible to patients, the AMA provides a way to look up the CPT codes you might see in medical paperwork. If you have paperwork that has a CPT code on it and you want to figure out what that code means, you can do so in several ways:

• Do a CPT code search on the American Medical Association website. You will have to register (for free). You are limited to five searches per day. You can search by a CPT code or use a keyword to see what the code for a service might be.
• Contact your healthcare provider's office and ask them to help you match CPT codes and services.
• Contact your payer's billing personnel and ask them to help you.
• Bundled codes can be looked up in the same way.

Preventing Incorrect Coding

A good reason to understand CPT codes is so you can make sense of your hospital bill and catch any billing errors—which do happen often. Some patient advocacy groups say nearly 80% of bills contain minor errors.

These simple mistakes can have a big impact on your wallet. The wrong code can mean that your insurance won't cover any of the costs.

Try to take the time to review your bill carefully and compare it with your EOB to check for any errors. Healthcare providers or facilities can make typographical errors, coding for the wrong type of visit or service.

There are also fraudulent practices like upcoding. That's charging you for a more expensive service. Another error is unbundling, or billing bundled services or procedures as separate charges. It's good to keep these errors on your radar. When in doubt, call your provider to talk any possible mistakes.

HCPCS Codes

HCPCS codes are used and maintained by the Centers for Medicare & Medicaid Services (CMS). They are used to bill Medicare, Medicaid, and many other third-party payers.

There are two levels of codes:

• Level I codes are based on CPT codes. They're used for services and procedures offered by healthcare providers.
• Level II codes cover health care services and procedures that aren't performed by healthcare providers.

Examples of items billed with level II codes are medical equipment, supplies, and ambulance services. HCPCS level II codes start with a letter and have four numbers. They may also have extra modifiers: either two letters or a letter and a number.

HCPCS level II code lists can be found on the CMS website. Level I codes, however, are copyrighted by the AMA just like CPTs.

Summary

CPT codes are letter-number combinations that represent healthcare services and supplies. The AMA developed the codes to make sure that all healthcare providers have a uniform system for reporting the services they provide.

When you visit a healthcare facility, your provider uses CPT codes to let your insurer or payer know which services you received. The insurer or payer reimburses the provider based on the codes. You can see the codes on discharge paperwork, bills, and benefit statements.

It's a good idea to check the codes when you receive a bill or statement. Your provider or the coder can sometimes make errors that end up costing you money.

A Word From Verywell

Being well-informed may help you get better medical care. When you see something you don't understand in your medical record or bill, discuss it with your healthcare provider or insurer. You have a right to take an active role in making sure your health care is properly tracked.