mdi Consultants
There is no lack of codes. Current procedural terminology (CPT) codes are used primarily to identify medical and surgical procedures and services performed by physicians and other health care professionals. Codes for diagnosis related groups (DRGs) are a classification system developed by Medicare as part of the prospective payment system for inpatient care. There are T-codes for emerging technologies, as well as nondescript codes (-99 codes) to identify new medical technologies until a specific code is assigned. Healthcare Common Procedure Coding System (HCPCS) codes are intended to report supplies, medical equipment and services that are regularly billed by suppliers, not physicians. These codes, when placed on a claim form, operationally link coverage to payment.
If there is no existing code which adequately describes the new medical technology, application for creation of a new code must be made to the appropriate committees, CPT procedural codes to the AMA and HCPCS codes to Medicare (CMS). New code applications are received on strict deadlines and take a long time for approval, which certainly is a major factor in the long delay for reimbursement approval by Medicare. For instance, approval for a new CPT code generally takes about 1 to 2 years.
The first step in obtaining codes is to apply by application to the AMA for a new CPT code. The AMA has established the Relative Value Scale Update Committee (RUC) which makes recommendations annually regarding new and revised physician services the request is referred to appropriate specialty members of the CPT Advisory Committee. If the advisors concur that a new CPT code should be added, the application is approved. The Panel meets three times each year and evaluates approximately 350 new technologies
HCPCS is a standardized coding system that is used primarily to identify services (such as ambulance services) and durable medical equipment (DME), prosthetics, orthotics, and supplies (DMEPOS). These codes are primarily used by medical suppliers, so they are typically not costs that get passed through a physician’s office. HCPCS coding is intended to be used to identify DMEPOS and formulate fee schedules in a consistent manner for billing purposes. CMS contracts with The Statistical Analysis Durable Medical Equipment Regional Contractor (SADMERC) which provides assistance in determining whether or not a HCPCS code exists which describes the new product. If none is found, an application form for a new code, a cover letter outlining the new code request and a brief summary of why the code is needed is submitted to CMS, together with the FDA letter confirming 510(k) approval, data supporting clinical effectiveness, and product brochures and/or booklets. Once the application is received, the product is placed on an agenda and reviewed by a panel whose membership includes representatives of Medicare, Medicaid, and private insurers. These informal, public meetings permit interested parties to make oral presentations or to comment in writing regarding the coding issues.