Which procedure coding system was developed by the american medical association (ama)?

The Healthcare Common procedure Coding System (HCPCS) is divided into two principal subsystems, referred to as level I and level II of the HCPCS.

Questions on the Use of Level I HCPCS

Level I of the HCPCS is comprised of Current Procedural Terminology (CPT-4) , a numeric coding system maintained by the American Medical Association (AMA). The CPT-4 is a uniform coding system consisting of descriptive terms and identifying codes that are used primarily to identify medical services and procedures furnished by physicians and other health care professionals. These health care professionals use the CPT-4 to identify services and procedures for which they bill public or private health insurance programs. Level I of the HCPCS, the CPT-4 codes, does not include codes needed to separately report medical items or services that are regularly billed by suppliers other than physicians.

Issues related to the application of Level I HCPCS codes (CPT-4) for physicians will be referred to the AMA. See Related Links Outside CMS below.
 

Questions on the Use of Level II HCPCS

Level II of the HCPCS is a standardized coding system that is used primarily to identify products, supplies, and services not included in the CPT-4 codes, such as ambulance services and durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) when used outside a physician's office. Because Medicare and other insurers cover a variety of services, supplies, and equipment that are not identified by CPT-4 codes, the level II HCPCS codes were established for submitting claims for these items.

Contact Information for HCPCS:

HCPCS Email Address:

Coding questions regarding the use of Level II HCPCS codes related to durable medical equipment, prosthetics, orthotics, and other supplies

Suppliers should check with the pricing, coding analysis, and coding (PDAC), contractor to CMS. The PDAC is responsible for providing suppliers and manufacturers with assistance in determining which HCPCS code should be used to describe DMEPOS items for the purpose of billing Medicare. The PDAC has a toll free helpline for this purpose, (877) 735-1326. In addition, the PDAC publishes a product classification list on its website that lists individual items to code categories. More information about the PDAC and the PDAC's product classification list can be found at the PDAC website. See Related Links Outside CMS below.

Issues regarding Level II HCPCS used in billing under the Hospital Outpatient Prospective Payment System (OPPS)

The American Hospital Association (AHA) and the Centers for Medicare & Medicaid Services (CMS) have joined together in establishing the AHA clearinghouse to handle coding questions on established HCPCS usage. The American Health Information Management (AHIMA) also provides input through the Editorial Advisory Board.

The clearinghouse will serve as a centralized point of contact to educate hospitals, policy makers and the public on HCPCS coding. Hospitals and health care professionals have experienced a growing need for greater consistency and improved understanding of HCPCS coding in the wake of implementation of prospective payment methods that utilize HCPCS coding for billing and payment purposes.

The AHA's Central Office will handle the clearinghouse functions and provide open access to any person or organization that has questions regarding a subset of HCPCS coding, particularly hospitals and other health professionals who bill under the hospital outpatient prospective payment system (OPPS).  Specifically, the AHA’s Central Office will handle clearinghouse functions such as providing interpretation, promotion and explanation of the proper use of a subset of HCPCS codes as follows:

• Level I HCPCS (CPT-4 codes) for hospital providers
• Level II HCPCS codes for hospitals, physicians and other health professionals who bill Medicare
  • A-codes for ambulance services and radiopharmaceuticals
  • C-codes
  • G-codes
  • J-codes, and
  • Q-codes (other than Q0163 through Q0181)

Formulate and submit the specific question you have regarding appropriate HCPCS coding (please be as specific as possible).  Please submit no more than one (1) question per request. Pertinent medical record documentation that will provide information to assist the Central Office in determining the appropriate HCPCS code assignment must be included (if applicable). Such documentation may include copies of consultations, diagnostic reports, operative reports or journal articles. Please submit other relevant information in a typed format (i.e. physician notes, nursing notes). Please note that without supporting documentation, your request may be returned unanswered.

In order to be HIPAA compliant, please remove all identifiers from the medical documentation (name of the hospital, patient and physician names). Under current HIPAA regulations, we are not able to maintain patient identifiable information. We regret that we are not able to accept inquiries for coding assistance that do not comply with the request for patient identification.  Inquiries not in compliance will be returned to the requester without an answer.

HCPCS-related questions must be submitted online to the AHA Central Office via the www.codingclinicadvisor.com website. 

Martin J. Citardi, MD
Professor & Chair

Every day, physicians rely upon Current Procedural Terminology (CPT) to report their services for payment by the Centers for Medicare & Medicaid Services (CMS) and other third-party payers. Increasingly, CPT coding captures quality and outcome measures — a feature that is likely to have increasing importance in the era of Pay for Performance (P4P) and the Physician Quality Reporting Initiative. Despite its near-ubiquity for reporting physician work, misconceptions about CPT are common. In fact, a recent on-line survey summarized considerable misconceptions about CPT.

CPT History

CPT is owned and maintained by American Medical Association, which has copyright protection on CPT. In 1966, the AMA published the first edition of CPT, which at that time focused on surgical procedures. The first edition sought to standardize terminology and reporting. The second edition, in 1970, expanded CPT’s scope. The third and fourth editions were released in the 1970’s. The fourth edition was a major update, and introduced a system for periodically monitoring and updating CPT. In 1983, the Health Care Financing Administration (HCFA), now CMS, adopted CPT for reporting of physician services for Medicare Part B Benefits. In 1987, HCFA also adopted CPT for reporting outpatient surgical procedures.

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) required that the Department of Health & Human Services develop standards for electronic data storage and transmission. Four yours later, the Department published the Final Rule, which selected CPT for reporting physician services (and other medical services) and International Classification of Diseases (9th revision, Clinical Modification), also known as ICD-9-CM for reporting diagnosis codes.

CPT Structure

CPT codes are divided into 3 categories:

• Category I CPT codes are assigned to procedures that are deemed to be within the scope of medical practice across the US. In general, such codes report services whose effectiveness is well supported in the medical literature and whose constituent parts have received clearance from the US Food and Drug Administration (FDA). The Relative Value Scale (RVS) Update Committee (RUC) process assigns relative value units (RVUs) for all Category 1 CPT codes.
• Category II CPT codes are tracking codes designed for the measurement of performance improvement. The concept is that the use of these codes should facilitate the administration of quality improvement projects by allowing for standardized reporting that captures the performance (or non-performance) of services designated as subject to process improvement efforts.
• Category III CPT codes are temporary codes for new or emerging technology or procedures. Such codes are important for data collection and serve to support the inclusion (or exclusion) of new or emergency technology in standard medical practice. Category 3 CPT codes are not assigned a value through the RUC process.

CPT Process

The AMA CPT Editorial Panel maintains CPT. The panel consists of 11 physicians nominated by the National Medical Specialty Societies, one physician nominated by the Blue Cross and Blue Shield Association, one physician nominated by America’s Health Insurance Plans, one physician nominated by the American Hospital Association, and one physician nominated by CMS. The AMA Board of Directors approves all nominations. The CPT Health Care Professionals Advisory Committee sends two representatives.

The CPT Advisory Committee supports the CPT Editorial Panel, which consists of physicians nominated by national medical societies that are part of the AMA House of Delegates. The CPT Advisory Committee provides important information on specialty-specific issues and suggests CPT revisions. The Performance Measures Advisory Committee (PMAC), which focuses on performance metrics, also provides input. The AMA’s regular staff also provides an important role.

Proposals for a new code go through the following steps:

• The specialty society develops the initial proposal. Typically, the specialty society will be most familiar with trends shaping a specific specialty. As a result, the specialty society can represent important trends driven by technology, changing practice, etc.
• The AMA Staff reviews the code proposal. This preparatory step confirms that the issue has not been previously addressed and that all of the documentation is in place.
• The CPT Specialty Advisory Panel then reviews the code proposal. All are given the opportunity to comment, and those comments are then shared with all participants in the process, but not with the general public.
• The CPT Editorial Panel then reviews the code proposal at its regularly scheduled meeting. The group can approve the code, table the proposal, or reject the proposal.
• Approved Category 1 codes are then submitted to the RUC for valuation.

CPT Category III Process

All CPT Category III codes are removed after 5 years from the time of publication. If the original requestors of the code want to continue use of the code, they must submit a proposal for continuing the code as a Category III code or promoting it to Category I status. Because it is difficult to imagine why the fate of an emerging technology would not be clear within 5 years, no Category III code has been renewed for a second 5-year term.

Category III codes are important for maintaining the integrity of the CPT process, since they permit a means to track the use of new technology, before such technology is widely adopted. The use of similar Category I codes for new technology is clearly discouraged by the CPT rules; in fact, the rules, in their strictest sense, actually prohibit this. The other alternative is the use of unlisted procedure Category I code, but when physicians do this, it becomes impossible to measure the actual usage of a specific technology. Thus, the preferred route for coding new technology is the development and application of a Category III code.

Summary

Physicians rely upon CPT codes, maintained by the AMA, to report services for payment. CPT has evolved since its introduction, and the AMA has a specific process for monitoring the integrity of CPT and adapting for changes in physician practice and medical technology. The AMA’s rules are quite specific, and over the long-run, physicians (and their patients) will be best served by following the recommendations of CPT process explicitly.