Levels of the HCPCS Coding System

The Healthcare Common Procedure Coding System, HCPCS, is a way of classifying medical supplies, materials, injections and services. It can also be used to bill an insurance company for Current Procedural Terminology, CPT, procedures or supplies that might not be listed. HCPCS was developed to standardize coding services for Medicare and Medicaid. Since those programs are the leaders in standards for health insurance, most private insurance companies use the same coding.

HCPCS Organization

• The Health Care Financing Administration, or HCFA, developed HCPCS in 1983. HCFA changed its name to the Centers for Medicare and Medicaid Services, CMS, in 2001. A five-digit, alphanumeric code identifies all supplies, materials, injections or services listed in the HCPCS code book.

Level I Codes

• Level I CPT codes make up the majority of those listed in the HCPCS code book. These CPT codes are not defined or do not have an assigned code in the Current Procedural Terminology manual. These codes are used for Medicare, Medicaid and non-Medicare/Medicaid patients, since the CPT does not list many codes for injections or supplies.

Level II Codes

• Level II National HCPCS codes range from A0000 to Z0000. The Level II National Codes are universal throughout the United States, but the processing and reimbursement procedures vary from insurance company to insurance company.

Other HCPCS Codes

• Sometimes a Level III Local HCPCS code is used. These codes are determined on an as-needed basis in the event of a local change in services or an epidemic. The use of these Level III codes is determined by the insurance company's billing guidelines. If you are unsure, ask to speak with a representative who might be able to better explain that insurance company's specific procedures for Level III codes.