Senator Cassidy Launches Investigation into CPT Codes
Senator Bill Cassidy, M.D., R-Louisiana, chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee, has initiated a comprehensive investigation into the American Medical Association’s management of the healthcare system’s critical Current Procedural Terminology (CPT) coding system. The senator’s inquiry focuses on what he characterizes as “anti-patient and anti-doctor” practices that may be driving up healthcare costs across the nation.
In a strongly worded letter sent Monday and released publicly Wednesday, Senator Cassidy accused the AMA of “abusing” its position as the custodian of the CPT code set that virtually every healthcare entity in America uses for billing and claims processing. The investigation marks a significant escalation in congressional oversight of medical billing practices and raises fundamental questions about the cost structure of American healthcare.
The AMA’s Role in Medical Billing
The CPT coding system serves as the backbone of medical billing in the United States, with more than 11,000 codes currently in use. For approximately half a century, the AMA has maintained trademark rights and curatorial responsibilities for these codes, which are used by doctors, hospitals, health insurance plans, and health IT vendors nationwide.
Senator Cassidy’s letter specifically challenged the AMA’s practice of charging fees to anyone utilizing the CPT code set. According to the senator, “These fees inevitably are passed on by CPT users to patients in the form of higher healthcare costs.” This arrangement has created what critics describe as a profit center built into the fundamental infrastructure of American healthcare billing.
The widespread adoption of CPT codes wasn’t entirely voluntary. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) mandated the use of a standard code set, effectively cementing the AMA’s position as the sole provider of this essential healthcare tool. This federal requirement is central to Senator Cassidy’s characterization of the arrangement as a “government-backed monopoly.”
Financial Transparency Concerns
A major component of Senator Cassidy’s investigation involves demanding detailed financial disclosure from the AMA regarding its CPT-related revenues. The senator specifically requested information about how much of the organization’s substantial $513.2 million total 2024 revenue came from the sale and licensing of CPT coding materials.
The inquiry also targets the AMA’s reported $281.4 million in “books and digital content” revenue, seeking clarification on what portion derives from CPT code subscriptions and related online resources. Senator Cassidy has asked the AMA to provide:
- Detailed breakdowns of revenue sources related to CPT materials
- Pricing methodology for CPT code subscriptions and resources
- Five-year historical data on price changes and associated revenues
- Information on cost structures and profit margins
These requests aim to establish whether the AMA is leveraging its unique position to generate excessive profits from a system that healthcare providers must use by regulatory requirement.
The Government-Backed Monopoly Question
The concept of a “government-backed monopoly” lies at the heart of Senator Cassidy’s concerns. Because the Centers for Medicare and Medicaid Services (CMS) and virtually all health insurance payment systems require the use of CPT codes, healthcare providers have no alternative but to license these codes from the AMA.
This creates a unique market situation where demand is guaranteed by regulatory mandate, yet supply is controlled by a single private organization. Senator Cassidy argues this arrangement may allow the AMA to set prices without typical market constraints, effectively creating a tax on healthcare transactions that ultimately burdens patients.
The AMA has defended its position by arguing that its status as the nation’s largest physician association makes it “uniquely positioned” to coordinate changes to a uniform code set necessary for large-scale medical service information exchange. The organization maintains that centralized management ensures consistency and interoperability across the healthcare system.
How CPT Codes Are Updated
Understanding the CPT code update process is crucial to evaluating the AMA’s stewardship of the system. The organization convenes a 21-member independent CPT Editorial Panel that meets three times annually to review applications for new or revised codes.
According to the AMA’s website, this process includes “the direct input of practicing physicians, medical device manufacturers, developers of the latest diagnostic tests, and advisors from over 100 societies representing physicians and other qualified health care professionals.” Senator Cassidy has specifically requested details about how provider feedback is incorporated into final code decisions.
The CPT 2026 code set, released last month, included 418 total code changes: 84 deletions, 46 revisions, and 288 additions. These new codes address emerging healthcare technologies, including augmentative and assistive AI services and technology-fueled remote monitoring capabilities.
Broader Healthcare Policy Implications
Senator Cassidy’s letter extended beyond financial concerns to address what he termed the AMA’s “anti-patient, anti-science advocacy efforts.” The senator reiterated Republican and Trump administration grievances regarding the AMA’s stated support for gender-affirming services and adoption of diversity, equity, and inclusion (DEI) initiatives.
The senator requested specific information about how much the AMA spent on these advocacy areas in 2024, arguing that reviewing CPT code-related revenues is “especially” pertinent in light of this advocacy work. This represents a continuation of concerns Senator Cassidy raised in a separate letter sent in late September, where he accused the association of being “guided by ideological views in adopting policy resolutions, rather than doing what is right for doctors and patients.”
What This Means for Patients and Providers
The investigation’s implications extend far beyond Washington politics. If Senator Cassidy’s concerns prove valid, the CPT code licensing fees charged by the AMA may represent a hidden cost driver in American healthcare, adding expense to every medical transaction without providing corresponding value to patients.
For healthcare providers, the investigation raises questions about whether they’re paying unnecessarily high fees for access to codes they’re required by law to use. For patients, the concern is whether these costs are being passed through in the form of higher medical bills and insurance premiums.
The AMA has confirmed receipt of Senator Cassidy’s letter and stated it will respond, though no timeline was provided. As this investigation unfolds, it may prompt broader discussions about how essential healthcare infrastructure should be managed and whether private organizations should maintain monopolistic control over systems mandated by federal law.
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