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Understanding HCPCS Codes

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In order for medical claims to process correctly, there is a standard of codes used to identify services and procedures. This system of coding is called the Healthcare Common Procedure Coding System known as HCPCS and pronounced "hicks picks".

HCPCS codes are regulated by HIPAA and requires all healthcare organizations to use the standard codes for transactions involving healthcare information. HCPCS includes two levels of codes.

Level I consists of CPT codes. CPT or Current Procedural Terminology codes are made up of 5 digit numbers and managed by the American Medical Association (AMA). CPT codes are used to identify medical services and procedures ordered by physicians or other licensed professionals.

Level II of the HCPCS are alpha numeric codes consisting of one alphabetical letter followed by four numbers and are managed by The Centers for Medicare and Medicaid Services (CMS). These codes identify non-physician services such as ambulance services, durable medical equipment and pharmacy.

Some HCPCS codes required the use of modifiers. They consist of two digit number, two letters or alphanumeric characters. HCPCS code modifiers provide additional information about the service or procedure performed.

Modifers are used to identify the area of the body where a procedure was performed, multiple procedures in the same session, or indicate a procedure was started but discontinued.

Providers should be aware of the HCPCS code guidelines for each insurer especially when billing Medicare and Medicaid claims. Medicare and Medicaid usually have more stringent guidelines than other insurers.

Make sure your medical coders stay up-to-date on HCPCS codes. Changes to HCPCS codes are updated periodically due to new codes being developed for new procedures and current codes being revised or discarded.

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