Allison Weber Shuren
If you are the type of physician who embraces new technology, then you
are probably at least somewhat familiar with Category III CPT codes.
Some refer to these Category III codes as “T” codes because
they all have the format of four numbers followed by the letter T, eg, 0177T.
What follows is a description of the purpose and history of Category III codes,
followed by my perspective on the role and function of these codes.
Category III codes first emerged in 2001. The Category III code process
was created to provide a means for establishing specific codes for new
procedures and new technology that do not meet the criteria for Category I CPT
codes. The key differences between Category I and Category III codes are
described briefly below.
Category III CPT codes
John S. McInnes
Category III codes are for “emerging technology, services and
procedures.” They are temporary 5-year codes, with the expectation that
within 5 years the Category III code will be converted to a Category I code.
The most significant advantages of the Category III application process are
that neither U.S. Food and Drug Administration approval or clearance (of a drug
or medical device used in the procedure) nor published peer-reviewed evidence
are necessarily required to obtain a Category III code.
This allows an applicant to establish a dedicated CPT code and possibly
a payment assignment during the investigational phase of a procedure, which can
be advantageous in obtaining early and favorable reimbursement for a new
technology. The following criteria are the basis for American Medical
Association CPT Editorial Panel review of Category III applications (although
only one criterion is necessary for the panel to review the application,
meeting one criterion is not necessarily sufficient for panel approval of a
Category III code request):
- A protocol for a study of procedures being performed;
- Support from the specialties that would use the procedure;
- Availability of U.S. peer-reviewed literature; or
- Descriptions of current U.S. trials outlining the efficacy of the
Although the overall hurdle is not very high for obtaining a Category
III code, it is difficult for a code applicant to gain approval from the CPT
Editorial Panel without support from the relevant specialty societies. The
panel usually will be reluctant to second guess a specialty society’s
reasons for not supporting an application. Also, if an applicant only has a
study protocol that has not been initiated at the time of application, the
panel may ask the applicant to wait until the procedure is further along in
clinical trials before granting approval.
Category I CPT codes
Category I codes “are restricted to clinically recognized and
generally accepted services, and not emerging technologies, services or
procedures.” Category I codes are the “permanent” CPT codes
listed in the CPT book, eg, 66984, cataract surgery. All of the following
criteria must be met to obtain a Category I CPT code:
- The service or procedure has received approval from the FDA for the
specific use of devices or drugs (provided FDA approval would be required);
- The suggested procedure or service is a distinct service performed
by many physicians or practitioners across the U.S.;
- The clinical efficacy of the service or procedure is
well-established and documented in U.S. peer-reviewed literature;
- The suggested service or procedure is neither a fragmentation of an
existing procedure or service, nor currently reportable by one or more existing
- The suggested service or procedure is not requested as a means to
report extraordinary circumstances related to the performance of procedures or
services that already have a specific CPT code.
The criteria that are most difficult to satisfy are that the service be
“performed by many physicians or practitioners across the U.S.” and
that the “clinical efficacy … [be] well-established and documented in
U.S. peer-reviewed literature.” The AMA has not defined what is meant by
“many physicians” and “across the U.S.” Presumably these
depend upon the prevalence of the condition for which the service is indicated
and the number of physicians who are potentially qualified to perform the
Although I have been told that inclusion in one U.S. peer-reviewed
publication is the minimum for a therapeutic service (and three is the minimum
for a diagnostic test), I believe that unless a single study was considered
definitive with certain key attributes (eg, large population, large number of
investigators, no methodological flaws, strong results, strong clinical need
for the service), it would be difficult to gain approval for a Category I code
with a single study.
Category III code controversy and current status
Since its inception in 2001, the Category III code system has gradually
become more accepted by the various stakeholders that use CPT codes
(physicians, payors, etc.). Initial bias that still lingers today was that
Category III codes were for unproven or experimental or investigational
procedures. As a result, some payors would take a shortcut to making a
non-coverage decision for services described by Category III codes, based on
the incorrect conclusion that Category III code status was a de facto
determination that the service was experimental or investigational. This
shortcut to non-coverage happened despite all payors (Medicare and private)
advising that coding and coverage are not related (ie, that the existence of a
particular code does not imply coverage and the lack of a particular code does
not limit coverage because coverage is based on a reasonable and necessary [or
similar standard] determination that mostly depends upon the clinical
evidence). This approach has caused problems, as some physicians have been
unwilling to adopt new technology if there was no prospect of being reimbursed
until the Category III code was converted to a Category I code.
Although this attitude among payors still persists to some extent (at
least with new Category III codes), payors are slowly coming to appreciate that
Category III codes were created to facilitate data collection while clinical
trials were being performed, but that sufficient evidence for coverage may come
well before a Category I code is approved and on the books.
A significant factor in this greater acceptance of Category III codes
among payors is a willingness among physicians to embrace new technology that
begins with a Category III code and greater tolerance for some of the initial
bumps in the reimbursement road that frequently accompany claims submissions
for new procedures.
Physicians are important and necessary advocates for new technology, and
it is through their continued efforts in advocating for new technology —
despite early resistance from payors — that the AMA Category III CPT
system will continue to advance its purpose of providing a pathway for new
technology and greater physician and patient access to advanced technology and
better outcomes for patients.
- CPT Assistant. 2009;19(5):3-5.
- John S. McInnes, MD, JD, is an associate in Arnold & Porter
LLP’s health care and food, drug and medical devices practice groups. He
can be reached at 555 12th St., NW, Washington D.C., 20004-1206; 202-942-6293;