These codes then assist members of  the health care industry in identifying health-related services on medical  claims for payment and analyzing service utilization, outcomes, and cost. 3 and CPT Were Practical Options for Standard Code Sets, Despite Some Limitations

Both ICD-9-CM Vol. 3 and CPT meet almost all of the criteria for standard  code sets recommended by HHS’s HIPAA implementation teams. In  addition, these codes sets each meet a criterion for procedural code sets  recommended by NCVHS. 1). For  example, the ICD-9-CM Vol. 3 and CPT have been supported by most  representatives of the health care industry as acceptable options for  HIPAA standard code sets given the practical considerations, since 1993  NCVHS and other representatives of the health care industry have argued  that a single procedural code set for reporting inpatient hospital  procedures, physician services, and other medical services including  outpatient hospital procedures would streamline data reporting and  facilitate research across providers and sites of service. In  addition, these procedural code sets meet almost all of the criteria  recommended for HIPAA standard code sets—that they improve the  efficiency and meet the needs of the health care industry, are recognized  by the public and private organizations that will maintain the code sets,  have low additional costs and administrative burdens associated with their  implementation, are independent of computer programs, and are  consistent with other HIPAA standard code sets. Appendix I: Code Set Standards for Health- Related Services Adopted under HIPAA

The Health Insurance Portability and Accessibility Act of 1996 (HIPAA)  required the Secretary of the Department of Health and Human Services  (HHS) to adopt standard code sets for describing health-related services in  connection with transactions such as filing claims for payment.
Why GAO Did This Study

Consistently classifying, defining, and distinguishing among the range of medical services provided today--from diagnoses to treatments--is critical for reimbursing providers and analyzing health care utilization, outcomes, and cost. Codes serve this role by assigning each distinct service a unique identifier. Health care providers, such as hospitals and physicians, report medical conditions and the health-related services they have provided to patients on medical records. In August 2000, the Department of Health and Human Services (HHS) adopted two standard code sets for reporting medical procedures: (1) the International Classification of Diseases, 9th Revision, Clinical Modification, Volume 3 (ICD-9-CM Vol. 3); and (2) the Current Procedural Terminology (CPT). Despite HIPAA's goals for administrative simplification, many representatives of the health care industry have expressed concern that the individual limitations of these code sets result in inefficiencies in record keeping and data reporting.

What GAO Found

GAO found that, given the 18-month time frame allotted to HHS under HIPAA for adopting standard code sets, ICD-9-CM Vol. 3 and CPT were practical options for HIPAA standard code sets despite some limitations. Both code sets meet almost all of the criteria for standard code sets recommended by HHS's HIPAA implementation teams. For example, they improve the efficiency and meet the needs of the health care industry, have low additional costs and administrative burdens associated with their implementation, and are consistent with other HIPAA standards. In addition, each of these codes sets meets a criterion for procedural code sets recommended by the National Committee on Vital and Health Statistics.