The Current Procedural Terminology (CPT)® code set is a medical code set maintained by the American Medical Association through the CPT Editorial Panel. The CPT (copyright protected by the AMA) describes medical, surgical, and diagnostic services and is designed to communicate uniform information about medical services and procedures among physicians, coders, patients, accreditation organizations, and payers for administrative, financial, and analytical purposes.

CPT codes are a critical part of the laboratory billing process. They are similar to ICD-9 and ICD-10 coding, except that it identifies the services rendered rather than the diagnosis on the claim. CPT is currently identified by the Centers for Medicare and Medicaid Services (CMS) as Level 1 of the Healthcare Common Procedure Coding System (HCPCS).

The AMA’s CPT Editorial Panel engages in an ongoing process improvement effort that frequently includes re-examination of the CPT Category I and Category III criteria.

CPT Category I codes are the codes most used in clinical lab and pathology group billing. They are the five-digit numeric codes included in the main body of CPT. These codes represent procedures that are consistent with contemporary medical practice and are widely performed. Codes assigned to this category have met certain criteria including:

• Procedure or service approved by the Food and Drug Administration (FDA)
• Procedure or service commonly performed by health care professionals nationwide
• Procedure or service’s clinical efficacy is proven and documented

The use of the code is mandated by almost all health insurance payment and information systems, including the Centers for Medicare and Medicaid Services (CMS) and HIPAA, and the data for the code sets appears in the Federal Register.

After a clinical laboratory service is provided, diagnosis and procedure codes such as CPT codes are assigned to assist the insurance company in determining coverage and medical necessity of the services. Once the procedure and diagnosis codes are determined, the lab bill enters the laboratory collections/revenue cycle management phase.