Statement of the American Medical Association
To the
National Committee on Vital and Health Statistics’
Workgroup on Quality

Presented by Michael Beebe

September 14, 2004

My name is Michael Beebe.  I am the Director of CPT Editorial and Information Services at the American Medical Association (AMA).  It is my pleasure to appear today before the Workgroup on Quality of the National Committee on Vital and Health Statistics (NCVHS).  I would like to thank you for the opportunity to testify.  In my testimony I will discuss a relatively new effort by the AMA and the CPT Editorial Panel to develop codes for performance measurement.  We view the new CPT Category II codes as a significant step toward a simplified and standardized reporting mechanism for agreed upon performance measures.


As the Workgroup knows, the CPT code set is the designated HIPAA standard for reporting health care professional services and procedures.  The use of the administrative record and CPT codes to collect data for quality measurement purposes is well established and often used to comply with HEDIS measures.  However, the development of CPT codes specific to performance measurement is new.

Prior to the designation of CPT as a HIPAA standard, the AMA undertook a broad based effort to enhance the CPT code set to accommodate the requirements of a national standard code set.  The CPT-5 Project analyzed the CPT Editorial process as well as deficiencies of the CPT code set and prospective new coding demands that have emerged out of user needs and as a result of administrative simplification.  Among the recommended enhancements to CPT were the development of CPT Category II codes for performance measures and CPT Category III codes for new and emerging technology.

These two new subsets of CPT codes were intended to meet user needs for reporting data on the delivery of health care services through existing administrative transactions.  In the case of CPT Category III codes, the elimination of local codes created the need for a method of reporting new technologies.  Also, the growing use of administrative data for research purposes required that more specific codes be developed as an improvement on unlisted CPT codes which are also used for services involving new technologies.  The development of CPT Category II codes for performance measurement were viewed as a means to leverage administrative simplification by establishing a code set that was focused on reporting and collecting data linked to established performance measures, and that could be conveyed via CPT through HIPAA transaction standards.

CPT Category II Performance Measurement Codes

CPT Category II codes are a set of optional tracking codes for performance measurement.  These new codes are intended to facilitate data collection by coding certain services and/or test results that are agreed upon as contributing to positive health outcomes and quality patient care.  These codes may be services that are typically included in an Evaluation and Management (E/M) service or other component parts of a service and are not appropriate for Category I CPT codes.  The CPT Editorial Panel anticipates that use of tracking codes for performance measures will decrease the need for record abstraction and chart review, thus minimizing administrative burdens on physicians and data collection or survey costs for health plans.   CPT Category II codes are being or have been developed for the following performance measurement sets:

Chronic Stable Coronary Artery Disease
Diabetes – Adult
Heart Failure
Major Depressive Disorder
Osteoarthritis of the Knee
Prenatal Testing
Preventive Care and Screening; Tobacco Use and Problem Drinking

CPT Category II codes are published twice a year, January 1 and July 1.  Codes published January 1 are eligible for use July 1 and those published July 1 are eligible for use January 1.  The 6 month lag is intended to provide payors with time to incorporate the codes into their systems.  Category II codes will also be published in the CPT book.  Category II codes make use of an alphabetical character , “F”, as the 5th character in the string (i.e., 4 digits followed by the letter F).  The code digits are not intended to reflect the placement of the code in the regular (Category I) part of the CPT book.  Instead, CPT Category II codes are arranged according to the following categories derived from standard clinical documentation format; subjective, objective, assessment and plan (SOAP):

Composite Measures 0001F
Patient Management 0500F-0503F
Patient History 1000F-1002F
Physical Examination 2000F
Processes or Results
Therapeutic, Preventive
or Other Interventions
Follow-up, Patient Safety
and Other Outcomes

In addition, to provide users with more information on each Category II code, cross-references to the measures associated with each Category II code and their origins are included for reference in Appendix H.  This appendix contains a table that relates each CPT Category II code to a complete description of the performance measure, the developer of the measure or source and the developers’ internet site to access additional information on the measure.  Also, for each Category II code there is information on each measure’s numerator, denominator, and inclusion/exclusion criteria.  Users are encouraged to review the complete measure(s) associated with each code prior to implementation of the Category II code.

Category II codes are reviewed by the Performance Measures Advisory Group (PMAG), an advisory body to the CPT Editorial Panel and the CPT/HCPAC Advisory Committee.  The PMAG is comprised of performance measurement experts representing the Agency for Healthcare Research and Quality (AHRQ), the Centers for Medicare and Medicaid Services (CMS), the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the National Committee for Quality Assurance (NCQA), and the AMA’s Physician Consortium for Performance Improvement (the Consortium).  The PMAG may seek additional expertise and/or input from other national health care organizations, as necessary, for the development of Category II codes.  These may include national medical specialty societies, other national health care professional associations, accrediting bodies, and federal regulatory agencies.

The PMAG will consider code proposals submitted by national regulatory agencies, accrediting bodies, national professional and medical specialty societies, and other organizations.  Code proposals must include documentation of the following:

  • The purpose or definition of the measure is consistent with its intended use (e.g., quality improvement and accountability, or solely quality improvement);
  • The aspect of care measured is substantially influenced by physician work (or work of other practitioner or entity for which the code may be relevant );
  • The extent to which an evidence-based process was used for measures development;
  • The extent to which a multidisciplinary review process was used to achieve consensus on measures among all constituents of the respective organizations, including internal and public comment processes;
  • The extent to which measures were tested to confirm their validity and feasibility for data collection;
  • Risk adjustment specifications and instructions are included for all outcome measures submitted or compelling evidence as to why risk adjustment is not relevant.

Initially, many of the CPT Category II codes were developed from clinical performance measures established by the Consortium.  The Consortium works to develop evidence-based clinical performance measures and clinical outcomes reporting tools to support physicians in quality improvement efforts, and utilizes clinical and methodological experts from more than 60 national medical specialty and state medical societies, the Agency for Healthcare Research and Quality, and the Centers for Medicare and Medicaid Services.  More recent Category II codes make use of measures developed by the NCQA.  In addition, the AMA has requested the assistance of NCQA by allowing inclusion of information regarding availability of Category II codes in the next publication of its Criteria and Measurement Rules.  This information would assist in outlining the need for use of Category II CPT codes, as well as acting as a notification to many who may not yet be aware of the presence of these codes, their availability for use, or the benefits associated with use of these codes and the measures that accompany them.

Application of CPT Codes to Candidate Recommendations.

I believe that only 4 of the first 8 candidate recommendations apply to professional claims for which CPT codes would apply.  In addition to CPT Category II codes, regular, Category I, CPT codes also contain substantial information that can be used for the measurement of quality.  For example: 76092 – Screening mammography, for the preventive care and screening measurement set; 80061 – Lipid Panel, includes: Cholesterol, serum, total; Lipoprotein, direct measurement, high density cholesterol; Triglycerides, for the heart failure measurement set; and 83036 – glycohemoglobin, for the diabetes measurement set.

Since CPT Category II codes are designed to be reported by the health care professional in the same way regular CPT codes are reported, the 1500 paper claim or the electronic 837 transaction can be used and would meet the needs of the following candidate recommendations:

Candidate Recommendation 1 – Selected Laboratory Results;

Candidate Recommendation 2 – Selected Vital Signs & Objective Data;

Candidate Recommendation 6 – Start and end dates for Global Procedures;

Candidate Recommendation 8 – Reporting Functional Status Codes;

There may, however, be a timing issue for the reporting of laboratory test results since they may not be available to the coders when the claims data are being collected and reported to a payer.  In fact, in the August 2, 2001 proposed rule (66 FR 40383) CMS included a discussion of CPT Category II codes.  CMS stated that no additional payment would be made for the use of these codes, but that “practitioners would, however, be able to report them on their Medicare bills to enable us to track these services”.


The AMA and the CPT Editorial Panel view CPT Category II codes as an essential part of any clinical quality data collection strategy.  While these codes are relatively new and currently there is no payment incentive for reporting, as with Category I CPT codes, their use is expected to increase as the need for efficient quality measurement is realized.  The CPT Editorial Panel process and the PMAG process are open to participation by any group or individual.  We hope that as the demand for performance measurement data increases, CPT Category II codes will become the standard for data collection through the administrative record and that code set will grow and become more robust as a result.

Thank you for this opportunity to present the views of the American Medical Association on these extremely important issues.