Procedure Codes

Procedure codes are also known as CPT-4 (Current Procedural Terminology, 4th Edition), and occasionally HCPCS (Healthcare Common Procedure Coding System, Level II). They are used to tell insurance companies what kind of procedure or service was performed on you. They also sometimes denote pharmacy and supply items, as well as capture physician visit times.

Procedure codes are 5-character numbers. True CPT-4 codes are 5 numbers, whereas HCPCS codes are a letter and 4 numbers. Procedure codes must match up with diagnosis codes in order to get claims paid. Keeping up on procedure codes attached to charges is one of the most important areas for hospitals and physicians, yet it's probably the one that's overlooked the most.

Like diagnosis codes, there may be multiple procedure codes on a hospital claim. Every single medical claim that is sent to an insurance company must have at least one procedure code on it, otherwise the claim will be denied. The procedure code doesn't actually have to be a procedure, though. It can be what's known as an evaluation, E&M, or visit code, which denotes the time, place of service, or type of patient a physician has seen a patient. It can also be a lab test, which is considered a procedure even though sometimes the patient may not have been at the facility that took the sample.

One thing that billing professionals should look at when claims are denied is whether the number of procedures attached to a code are proper. For instance, in New York state, the procedure code for transfusions (36430) is only allowed to be billed once a day, even if the patient has multiple transfusions throughout the day. Also, a number of procedure codes have time components to them, and though in some circumstances those time components don't follow strict rules, based on treatment levels (such as the E&M codes), others must adhere to the time rules without question (physical and occupational therapy charges).