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In this article, we will examine the third major code set, the Healthcare Common Procedure Coding System (HCPCS; pronounced “hicks-picks”).

This code is based on Current Procedural Terminology (CPT). Actually, the first level of HCPCS is identical to CPT. To avoid confusion let’s take a deeper look into its development.
HCPCS was developed by the Centers for Medicare and Medicaid (CMS) for the same reason that the American Medical Association (AMA) was developed for CPT. They both function for reporting medical procedures and services. When the Health Information Portability and Accountability Act (HIPAA) was passed, The use of HCPCS became mandatory under certain cases.
Nowadays, coders use HCPCS in order to communicate medical procedures to Medical, Medicaid, and other third parties. The code is made up of three levels. As mentioned above, level I is identical to CPT. During development the CMS looked at the CPT codes and decided that no improvements or changes were needed and instead opted for keeping them the same for HCPCS.
The real differences between the two coding systems are in level II.


Level II codes of the HCPS are meant to represent non-physician services. For example: ambulance use, wheelchairs, walkers, and other medical equipment and services that do not fit into level I. CPT describes the procedures done on the patient but it does not have the necessary codes for listing the product used during the procedure. HCPCS codes handles all the products and pieces of equipment that CPT does not.
Level II codes are similar to Level I, five character in length, but Level II codes are alphanumeric ( i.e. a letter occupies the first character of the code). These codes, like in ICD (International Classification of Diseases) and CPT, are categorized based on the services they describe, and are ordered numerically.
For example, J-codes are used for non-orally administered medication and chemotherapy drugs.
HCPCS code manuals contain an index and a table of drugs. When coding a medication delivery it is important to always use the drug table. Coding medication is one of the most important parts of using HCPCS codes, and the drug table will give you the most accurate information on how to code correctly.
HCPCS codes are used much like ICD and CPT codes. When you receive a medical report you will take notes on the procedure performed, materials used, and what prescriptions were given. Then you will use your HCPCS code to list the correct code.
Using HCPCS is much more specific that CPT. This code has codes for all types of variations and amounts of equipment and medication used. You’ll have to examine the medical report constantly in order to ensure you are coding the procedure accurately.
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Different doses of a medication will vary in cost so you’ll have to be weary about using the correct HCPCS code.
Similar to CPT, HCPCS lets you know which codes are new and which codes have been updated. New codes appear next to a circle, while revised codes will have a triangle next to them. HCPCS is always being changed and CMS will often times reuse codes. HCPCS contains strikethrough codes, these tell you that a code that used to be listed there has been removed and moved somewhere else.
Many codes in HCPCS Level II have specific guidelines for using them. So we advise you to always play close attention when using HCPCS. Always take note of the equipment and the amount of medicine administered.
If you are interested in an exciting career in the healthcare industry be sure to request information about our Health Administration school. This online program can help you get the training you need to start an entry level job in the healthcare field.
*In no way does Fremont University promise or guarantee employment or level of income/wages.


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