The volume and diversity of medical procedures is vast. More than 51 million inpatient surgeries alone are performed in the US every year.1 Left to their own devices, each provider is likely to document these procedures differently.
That’s why the medical community developed codes to provide a uniform language for describing medical procedures. This way, anyone seeing each code has the same understanding of what service or procedure was involved.
3 Types of medical coding classification systems
Throughout healthcare and its history, healthcare providers and agencies have created several common medical codes, each with its own unique purpose. These three different types of medical codes come with their own standards, language and purpose.
Healthcare providers like hospitals and healthcare networks will often use all three.
The ICD-10
Standard language for disease and injury reporting worldwide (very helpful to identify outbreaks)
The World Health Organization created the International Classification of Disease (ICD-10 codes) to report diseases and injuries.
ICD-10 codes tend to be the main thing people mean when they reference medical codes. These codes explain things like injuries, illnesses and anything that would bring a patient to the healthcare facility.
Since each patient’s visit does need documentation, some of the ICD-10 codes are strange, hilarious or truly baffling. Examples…
Pedestrian on foot injured in collision with roller skater.
Animal-rider injured in collision with trolley.
Struck by duck, subsequent encounter.
See 11 Strange ICD-10 Codes You Hope to Never Use for some more bizarre examples that made it into the ICD-10.
CPT® codes
Language for the procedures healthcare personnel perform
The American Medical Association (AMA ®) created Current Procedural Terminology (CPT® codes) to identify procedures or services performed.
So if a patient comes in with chest pains, and a physician orders an X-Ray, the patient’s medical billing information will include an ICD-10 code to describe the malady causing the chest pain and a CPT code that describes the specific type of X-Ray used.
These codes help standardize the care and delivery aspects of a healthcare provider’s work. For more on that, check out What Are CPT® Codes? An Easy Introduction.
HCPCS codes
Language for equipment, tools and medicines as well as outpatient services
The Centers for Medicare and Medicaid Services maintain the Healthcare Common Procedures Coding System (HCPCS codes) to identify equipment, medication and outpatient services. It can help providers determine the most durable medical equipment and stock up against medical necessity.2
These codes are crucial for medical administrators, managers and anyone who needs to keep track of inventory in a healthcare facility.
What are CPT codes? Understanding their role
If you work as a medical biller and coder, CPT codes will be your main jam. CPT codes bring efficiency and accuracy to the documentation and billing of medical procedures. The alphanumeric codes provide a standard way to identify:
- A patient’s health condition
- Reasons a specific treatment was given
- Other relevant details about the patient’s medical situation
This widely-accepted classification system is used by doctors and other healthcare providers to report medical procedures and seek reimbursement from public and private health insurance companies.
Healthcare decision makers can also analyze CPT code usage in claims to advance medical care review guidelines. In addition, public health officials review CPT code use to better understand health statistics, such as health risks and healthcare system utilization.
CPT is the national coding standard. However, it is not a static document. Healthcare is always changing, so there’s a need to continually update codes. A CPT editorial panel, including physicians and members from the Centers for Medicare & Medicaid Services, review and update codes each year.3
Types of CPT code set categories
CPT codes come with three separate categories, or code sets. The first category is the most commonly used.
Category I codes
These codes all track procedures that are commonly used in clinical practice, including any drugs or medical devices that have received FDA approval.
Category II codes
Category II is all about quality improvement and efforts healthcare providers are making to track quality performance initiatives.
Category III codes
Category III defines experimental procedures and technologies and tracks them.
The role of a medical coder
Medical coders play an important role in the healthcare system. They are specially trained to review medical records, doctor’s notes and lab test results and apply relevant CPT codes so the patient’s insurance can be billed. Medical coders (also called medical coding specialists) may work at doctor’s offices, hospitals or insurance companies.
As a medical coder, it’s important to understand medical verbiage in order to turn the information found throughout patient records into standard CPT and ICD codes. Being detail oriented is a key part of the role, since accuracy is necessary for accurate medical billing and healthcare statistics tracking. Medical coders also need to stay up to date on the frequent changes that occur in coding systems and medical billing systems.
Path to becoming a medical coder
Becoming a medical coder requires at least a high school diploma or equivalent, a relevant certificate and a background check.
Specific certification may be required to work as a medical coder. It is important to check with employers regarding requirements.
You can earn the medical billing and coding certificate separately or as part of an associate degree program. These programs teach you about reviewing patient records, understanding claims processing and translating services and procedures into the appropriate codes.
Medical coding in today’s healthcare landscape
The rise in chronic disease, along with the aging population, is driving an increased demand for healthcare.
Having a succinct, standard language generates a variety of benefits for many different individuals and organizations. Medical codes make it easier for healthcare providers to document and get reimbursed for medical services.
The codes enable government agencies and researchers to identify healthcare usage trends, disease prevalence and health outcomes.
Medical billing and coding is an essential career in all of that. And most people don’t realize that you can earn a Medical Billing and Coding certificate in as few as 9 months.4
It’s a great career option for people who want to work in healthcare, but who aren’t as thrilled about the idea of constant patient care.
Curious? Get more details on what the job is like. Is Medical Coding Hard? Health Information Pros Share Their Experience
Most coding positions are not considered "entry level"; a combination of education and work experience is typically required to attain a coding position. Similarly, coders, especially those who are new to the field, should not expect to find a position where they can work from home. Most coding positions require onsite work.
American Medical Association® is a registered trademark of American Medical Association
CPT® is a registered trademark of American Medical Association
1National Center for Health Statistics, Inpatient Surgery, (date accessed), FastStats - Inpatient Surgery
2Healthcare Common Procedure Coding System (HCPCS), (date accessed), Healthcare Common Procedure Coding System (HCPCS) | CMS
3CPT® Editorial Panel, (date accessed), Latest CPT® Editorial Panel News & Info | American Medical Association
4Completion time is dependent on transfer credits accepted and the number of courses completed each term.
