What are Category III codes, and why should you care?

I need to thank a reader of the column for the subject of this article. The reader wrote to ask me about Category III CPT codes, which she did not understand.

There are three types of CPT codes, all of which vary significantly in their purpose.

First, the other two types

We are all familiar with Category I, our common testing, surgery, and exam codes (for example, 92014 — Comprehensive eye exam, 67028 — intravitreal injection, and 92134 — OCT of the retina). Payers generally recognize Category I CPT codes, so reimbursement is usually obtainable from payers. But, as you would expect, payers vary as to what they cover, so be sure to check before expecting payment via claims.

The second set of codes is known as Category II. In the CPT book, this section is designated for “Performance Management.” CPT notes: “The primary purpose of this section is to provide classification codes which allow the collection of data for performance management.” Many of us are familiar with “Quality” codes related to the Physician Quality Reporting System, which became part of the Merit Based Incentive Payment System (MIPS) as of Jan. 1, 2017. These codes typically end with the letter “F.” This section has some other unique characteristics. For example, there are four unique modifiers solely for use with these codes; all end in the letter “P.” They don’t provide reimbursement — even though some may be filed with $0.01 on your claims to payers. In this case, the use of $0.01 is to ensure passage through the claims system, including clearinghouses — you aren’t actually paid the penny since payers understand the intent.

The third category

Back to the subject of this article: Category III CPT codes. Many practices use and get paid for some of these codes now. Again, the existence of a code (no matter the category) doesn’t guarantee coverage by a payer.

CPT notes in the Category III Section Overview: “The following section contains a set of temporary codes for emerging technology, services, procedures, and service paradigms. Category III codes allow data collection for these services/procedures.” CPT also states: “Use of unlisted codes does not offer the opportunity for the collection of specific data. If a Category III code is available, this code must be reported instead of a Category I unlisted code.” Additionally, “The codes in this section may not conform to the usual requirements for Category I codes … For Category I codes, the [CPT] Panel requires the service be performed by many health professionals in clinical practice in multiple locations and that FDA approval, as appropriate, has already been received.” All Category III codes end in the letter “T” to denote their temporary nature. They generally expire after a certain amount of time (five years) and are either replaced with a Category I code or deleted from use (CPT itself lists the planned expiration as a “sunset” date).

Examples

Perhaps the most common example of a Category III code now in use is the code for iStent (Glaukos), 0191T. This code is described as “Insertion of anterior segment aqueous drainage device; without extraocular reservoir, internal approach, into the trabecular meshwork; initial insertion.” If you look this up in your CPT book, it is noted to “sunset” in January 2019. All the current local Medicare contractors all cover 0191T, but they have been given wide discretion by CMS on both coverage and the actual local approved payment amounts.

An example of an ophthalmic surgery Category III code that was “promoted” to Category 1 was 0192T, which became CPT code 66183 for use on claims as of Jan. 1, 2014. At first, when 66183 was published for use, some payers still refused to cover it (they continued to denote it as “experimental and investigational”), although nearly all cover it now. Don’t use a different code if the Category III code accurately describes the service your office provided merely to facilitate payment — that’s highly improper, which the CPT language quoted above makes clear.

Most Medicare Administrative Contractors and payers issue a “Category III” policy. They usually show which of the many Category III codes in effect have coverage (and under what conditions) and which have no coverage. They are fairly easy to locate; go to the payer’s website and search on “Category III” and you will likely get to the policy document.

Conclusion

In eye care, Category III codes are most often created to denote new surgeries or devices with a surgery or for new diagnostic procedures/tests. When a Category III code exists, it must be used even if no coverage exists. Investigate coverage, and be transparent with your patients before doing these services so that they know if they or the insurance will be paying.

Also, don’t forget that some payers might only allow these via prior authorization or other pre-service determination. Even when one of these temporary codes has coverage, there may be specific diagnoses or documentation required in your medical records, and the payer may ask for your supporting documentation. Additionally, when covered, you are generally obligated to accept the payment the payer decides.

If you have other suggestions for topics, send them our way! We are happy to consider them.

As always, “Good Coding” to you! OP

REFERENCE:

1. American Medical Association (AMA). Current Procedural Terminology (CPT) 2017. Professional Edition.

Mr. Larson is a senior consultant at Corcoran Consulting Group. He specializes in coding and reimbursement. Mr. Larson is based in Atlanta.