What Is CPT? | Coding & Billing | MD&D # 19

Evidence based insights into physician compensation, RVUs, contracts, healthcare economics, and personal finances. For residents, fellows, and early-career attendings.

Life and Finances, in Medicine.

When you see a patient, two basic questions eventually have to be translated into codes: Why did the patient receive care? And What did you do?

Two different coding systems answer these questions. ICD-10-CM describes the patient's diagnosis or reason for the encounter. CPT describes the medical services and procedures performed.

CPT stands for Current Procedural Terminology. It's the coding system used throughout the United States to describe the services provided by health care professionals. Maintained by the American Medical Association (AMA) and updated annually, CPT covers office visits, surgery, imaging, lab services, and nearly everything else you might do for a patient. If you performed it, there's a code for it.

Where Did CPT Come From? A Brief History of the CPT system.

CPT didn't begin as the massive coding system we use today. The AMA published the first edition in 1966 to create standardized terminology for reporting medical procedures. That edition focused mainly on surgery, with smaller sections for medicine, radiology, and laboratory services.

The second edition came in 1970. It expanded the system and introduced the five-digit format still in use today. Through the 1970s, CPT grew with medicine itself, adding diagnostic and therapeutic services as new procedures and specialties emerged. In 1977, the AMA introduced periodic updates so the system could keep pace with practice and technological advances.

In 1983, CPT was incorporated into the Healthcare Common Procedure Coding System (HCPCS), a collection of medical codes used by healthcare providers, insurers, and medical billers to process health insurance claims.

In 2000, HIPAA designated CPT as the national coding standard for physician and other health care professional services. Today, CPT is one of the basic languages used to describe medical work in the United States.

How Is CPT Organized?

Most codes clinicians use day to day are Category I codes, organized into major sections:

Two other categories exist. Category II codes are supplemental, used mainly for performance and quality measurement. Category III codes are temporary, used to track emerging technologies and services. Both were introduced in 2002 as CPT continued to expand beyond its original procedural scope.

E/M Codes Are CPT Codes

Clinicians sometimes talk about "E/M codes" and "CPT codes" as if they're different things. In fact, they're not. Evaluation and Management codes are simply a family within the CPT coding system. For office visits, the codes are 99212–99215 for established patients and 99202–99205 for new patients. The higher the last digit, the higher the level of complexity of the encounter.

Two things make these easier to remember. First, we usually call them levels 2 through 5, matching that last digit of the code. Second, codes for new-patient encounters (a patient not seen by you or any other provider in your practice (and of course specialty), in the past three years) have a zero before the last digit; codes for established-patient encounters have a one before the last digit.

So, when you choose 99213, 99214, or 99215 to bill an office visit, you're using a CPT code, which happens to belong to the E/M family, representing cognitive work rather than a procedure. That’s one of the reasons many providers distinguish E/M from CPT codes, as E/M reflecting cognitive work and CPT procedural work. In fact, one is part of the other.

Using an example from my specialty. A patient comes in for abnormal uterine bleeding. I take a history, review prior imaging, evaluate labs, discuss possible causes, weigh treatment options, and formulate a plan. That work is captured by an E/M code of the CPT classification. If I then perform an endometrial biopsy, the biopsy is captured by a separate non-E/M code of the CPT classification.

Different services. Different codes. Same CPT system.

The office and outpatient E/M codes underwent a major change in 2021, allowing code selection to be based primarily on medical decision-making or total time, instead of the older way heavily based on documentation

Why Is CPT Different From ICD?

This is where coding starts to make sense as a system. ICD-10-CM and CPT exist for different purposes. ICD, the International Classification of Diseases, and our equivalent In the U.S., the ICD-10-CM, the Clinical Modification, is a classification of diseases. CPT, by contrast, is used to describe medical services and procedures you provided.

Imagine a patient with uterine fibroids who undergoes a laparoscopic hysterectomy. The fibroid diagnosis is an ICD-10-CM code, and the hysterectomy is a CPT code. Or take a patient with pelvic pain who spends 40 minutes discussing imaging, treatment options, medications, surgery, and future management: the reason for the visit is ICD-10-CM, and the work performed is an E/M code.

The simplest way to remember it: ICD-10-CM tells us why the patient is receiving care. CPT tells us what you did for that patient. They systems work together.

CPT Does Not Determine Payment by Itself

One more distinction matters here: a CPT code identifies a service, but it doesn't by itself determine what that service pays. For this we use relative value units (RVUs), which later receive a dollar value based on something we call the Conversion factor. CPT provides the language that describes the work. The payment system determines what that work is worth.

That distinction matters, because before you can understand how an RVU is assigned, what it's worth, or how your productivity is calculated, you first must understand the codes that describe the work you actually performed.

CPT is the language used to describe the medical work we perform. ICD-CM explains why the patient received care; CPT explains what we did.

Understanding that distinction is the foundation for understanding coding, RVUs, productivity, and ultimately compensation. If the work you perform is not accurately translated into the appropriate CPT code, the productivity and reimbursement associated with that work may not accurately reflect what you actually did.

✓ CPT tells us what you did. CPT codes describe medical services, procedures, and Evaluation and Management work performed for a patient.
✓ E/M codes are CPT codes. Office visit codes such as 99213, 99214, and 99215 are part of the CPT system, just like surgical, radiology, pathology, and other procedural codes.
✓ CPT describes the service, but it does not determine payment by itself. CPT codes connect the work you perform to payment systems such as Medicare's RVU-based Physician Fee Schedule.

“The limits of my language mean the limits of my world.”
— Ludwig Wittgenstein

Have a question about compensation, contracts, personal finance, or life decisions in medicine? Send it to MD&D. Your question may be answered in a future article, podcast, or Q&A.

email: [email protected]

MD&D is a FREE platform for residents, fellows, and early-career attendings who want to better understand RVUs, compensation, contracts, and finances in medicine.

Website:
mddecisions.org

Newsletter:
read.mddecisions.org

Free RVU Playbook:
playbook.mddecisions.org

Join a growing community of medical professionals dedicated to understanding the business of medicine.

Bruno Casanova, MD

Founder & Host

Medicine, Dollars & Decisions

Life and Finances, in Medicine.