Medicare Billing Codes: Uniformity for Consistent Benefit Distribution

For most individuals, the various Medicare billing codes constitute a confusing and largely impenetrable aspect of the patient billing process. In fact, however, these codes allow a measure of uniformity and consistency throughout the Medicare system by providing specific codes for each individual aspect of patient care. For instance, a number of different procedures may require the same type of anesthesia treatment; Medicare billing codes allow these treatments to be categorized uniformly despite the differences in the situation in which they were used. This allows procedures with a high degree of similarity to be charged similarly, regardless of the context in which they were performed.

Most Medicare billing codes are assigned in accordance with the Current Procedural Technology (CPT) standards established by the American Medical Association. This numeric coding system constitutes Level One of the Healthcare Common Procedure Coding System, which is used by the Centers for Medicare and Medicaid to classify medical treatments for insurance payment purposes. Level Two codes are alphanumeric and usually refer to procedures, devices and equipment not requiring the direct action of a physician. For example, Level Two codes may be used to classify prosthetic devices necessary for a patient’s health and recovery, ambulance services to and from the hospital, and other care that is not provided directly by a doctor or nurse. National Drug Code classifications are also included in Level Two Medicare billing codes.

Level Three coding is no longer in common use, but at one time was used by local Medicaid facilities to classify programs that were in use in the specific region. Because these were not uniformly applied and were highly specific in nature, they were not useful on the national level and were discontinued at the end of 2003 in the interest of maintaining uniformity of medical coding.

While Medicare billing codes may be confusing and difficult to understand, they provide a valuable way of comparing disparate medical treatments by breaking them down into their component elements. This allows uniformity of billing and payment, and offers Medicare recipients a consistent level of benefits and services for their health care needs.