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This background paper reviews the two principal coding systems used to describe health services in the United States: ICD-9-CM and HCPCS, a combination of CPT-4 and national and local codes. It probes the relationships of these coding systems to payment policy, administrative simplification under HIPAA, and other concerns. The paper also addresses four coding issues: governance of CPT; adoption of ICD-10-CM; the appropriateness, accuracy, and responsiveness to change of the codes themselves; and the degree of documentation needed to monitor health services and determine payment.

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