What is a CPT Code?

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what is CPT code

Say that you’re a responsible adult who has health insurance, either independently or through a corporation, and you make an appointment for an annual physical. You go to the doctor’s office, you pay your co-pay, and you get poked and prodded.  You either lie about how much you’ve been exercising or agree that you need to do more, and are sent on your way.

A little while later, you get a letter in the mail from your insurance company that says it is not a bill, it is an explanation of benefits, with the amount your services cost, and how much your insurance paid.  But how do they get that information? Your doctor’s office used a series of standardized codes to inform your insurance company what they did so the doctor’s office can be reimbursed for their services.

In this article we are going to talk about what those standard codes – CPT codes – really are. 

What does CPT stand for?

CPT stands for “Current Procedural Terminology” and there is a code assigned to everything that a doctor’s office might do, from surgery and lab tests to office visits and vaccines.

What does a CPT code look like?

CPT codes consist of 5 digits, sometimes they are five numbers, and sometimes they are four numbers and one letter. Because these codes are uniform across the healthcare industry, they standardize the method of tracking your care between providers.

How do medical billing experts know what code to use?

To ensure that these codes are the same, they are managed by the American Medical Association and the medical billing experts at your provider’s office will use them to record your care. Sometimes these codes are changed, some are added for new items, and old ones are removed. There are many thousands of different codes, and the standard codes are updated on a yearly basis.

CPT Codes and Billing

Just because the codes used to standardize the notation of medical services are the same across the healthcare industry, it does not mean that your provider has the same agreement with your insurance that another provider does. Where one provider may be reimbursed $50 for a service, another may only be reimbursed $40, leaving you to pay $10 more to them after insurance takes care of their part.

Some CPT codes are for what is called “bundled services” or services that are typically performed at the same time and therefore have been included as a single code. For example, this can be the individual codes that make up the service of receiving a vaccine: the service itself (the injection), the reason for receiving the injection, how it is administered, and what is being injected.  The service of how a medication is administered by injection will appear in multiple bundled codes for things like a flu vaccine, local anesthesia, steroids, etc.

One of the problems with bundled codes is that sometimes the individual services within a bundled code can be listed separately, leading the patient to pay more. Sometimes this is accidental, and sometimes it is the result of deliberate up-charging to commit fraud. There is even a special term for this called “unbundling” when bundled codes are split out and billed individually.

Additionally, if services outside the bundled code are required, it can cause problems known as “upcoding” or, services are billed for more than they should be. For example, anesthesia for surgery may be billed as a more complicated procedure or if it was performed by a doctor it is more than if it was done by a nurse.

Medical Billing Process

The medical billing process begins in your provider’s office where they or their assistant will enter the CPT codes—or HCPCS codes (Healthcare Common Procedure Coding System) if you have Medicare—that correlate to your care. This is either done electronically, or manually on paper forms.

Once the codes have been entered, they are verified by a medical biller and the correct code is assigned if it has not been already, then it is submitted to your insurance company. Most of the time this is done electronically, though there are still some holdovers using mail or fax machines to submit billing to insurance.

Your health insurance company, based on the plan you have, will use the codes provided by your doctor’s office to process your health claim and pay the provider for services rendered, and the remainder will be what you have to pay to your doctor.

The health data collected by your providers is used by your health plan and government agencies to determine future healthcare costs. Future healthcare costs are of particular importance to individuals if they have experienced an accident or injury that will require ongoing care and they need to argue for damages.

If your medical bills are much higher than you expect them to be, contact one of the medical billing experts in your region to look over your bills and see if there is anything out of place.

Why You Need Medical Billing Analysts

It is highly recommended to hire medical billing experts to determine and testify to the reasonable value of medical service. The provider’s location can affect these costs and reimbursements.

Whether you are a plaintiff or a defendant in a case, one of the most important items in Automobile, Personal Injury, and Medical Malpractice cases is the cost of medical bills. Figuring out medical costs can be complicated, and expert guidance is critical to ensuring you have a clear understanding of what is “fair and reasonable” with regards to the finances involved in your medical care.

Medical Billing Analysts offers litigation support services nationwide, with offices in New York, New Jersey, Connecticut, Pennsylvania, Georgia, Florida, Texas, Nevada & California. Medical Billing Analysts represents both defendants and plaintiffs with regard to improper medical billing and coding.

The team of MBA professionals will review the hospital, medical and therapy bills to determine the value of past medical expenses, and based on local CPT codes they can also perform a Cost Projection Analysis of future costs.  Through meticulous analysis, we can justify the reasonable cost of services which assists in resolving the case.

Contact Medical Billing Analysts by phone or email at 800-292-1919 or intake@medicalbillinganalysts.com. We’re here for you, whether you need an evaluation of a single charge, or a complex injury case.