Politics puts a target on AMA and its crucial CPT code system

Modern Healthcare – Monday, October 20, 2025
By Michael McAuliff

The American Medical Association and the healthcare system itself may be in for significant disruption if key Republicans have anything to say about it.

The AMA has faced questions for decades about the propriety of a healthcare provider organization running the medical coding system that’s closely tied to how much physicians get paid. Now, the AMA is caught up in the politics of transgender healthcare and diversity, equity and inclusion programs, and in the sweeping changes to the healthcare infrastructure Health and Human Services Secretary Robert F. Kennedy Jr. seeks.

At issue is the AMA’s Current Procedural Terminology, or CPT, system. These 11,000 CPT codes not only identify billable procedures, but serve as the starting point for Medicare reimbursements, which in turn influence how much private health insurance plans pay.

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Kennedy has long been a critic of the AMA’s role in medical coding, and so has Sen. Dr. Bill Cassidy (R-La.), who chairs the Health, Education, Labor and Pensions Committee.

Cassidy wrote a pointed letter to the AMA demanding the group justify its monopoly on medical billing codes and reveal how much money it earns from licensing CPT codes to users.

But Cassidy also labeled the association “anti-patient, anti-science” because it opposes policies to bar access to gender-affirming care for children and supports diversity, equity and inclusion initiatives.

“Your organization has abused this government-backed monopoly by charging exorbitant fees to anyone using the CPT code set, including doctors, hospitals, health plans and health [information technology] vendors. These fees inevitably are passed on by CPT users to patients in the form of higher healthcare costs. This is anti-patient and anti-doctor,” Cassidy wrote to AMA President Dr. Bobby Mukkamala on Oct. 6.

The coding and value-setting functions of the AMA are deeply embedded throughout the healthcare system, and would be hard to replace.

Cassidy has not said what he would prefer, and his office declined to elaborate. In a brief interview, Cassidy offered only that artificial intelligence might play a role.

Congress granted the AMA sole authority over medical billing codes in the 1980s based on the argument that physicians are best qualified to define procedures, evaluate costs and oversee a uniform system for the public and private sectors.

“Someone’s got to write codes for billing issues, and it’s a lot more efficient for one group to do it,” said David Kendall, senior fellow for health and fiscal policy at Third Way, a centrist Democratic think tank.

The AMA vigorously defends its CPT system, which Executive Vice President and CEO Dr. John Whyte described as the foundation of medical data interoperability and critical to streamlined administration in the healthcare sector.

“CPT was voluntarily adopted across federal and commercial insurance programs — a model of private-public collaboration that works. Our data-driven healthcare system depends on CPT to keep information flowing efficiently,” Whyte said in a statement.

Kennedy’s HHS already has taken aim at another function the AMA performs in the healthcare system: its control of the Relative Value Scale Update Committee, or RUC, which plays a central role in setting Medicare reimbursements to doctors. The Centers for Medicare and Medicaid Services laid out a plan to reduce the AMA’s involvement in the process in a proposed rule it issued in July.

Democrats such as Sen. Elizabeth Warren (Mass.) have also been critical of RUC, saying it inflates costs and favors specialists over primary care doctors.

But conservatives have been more likely to condemn the AMA’s management of the CPT code system, and this isn’t the first time scrutiny of this issue accompanied Republican anger at the medical society about other matters.

In the 2000s, for example, then-Senate Minority Leader Sen. Trent Lott (R-Miss.) questioned the CPT code setup after the AMA supported legislation to establish a “Patient’s Bill of Rights,” which most Republicans opposed. Likewise, the AMA’s endorsement of the Affordable Care Act of 2010 led then-Sen. Dr. Tom Coburn (R-Okla.) to raise the issue again.

“This is a common way for politicians to push the AMA to get what they want,” Kendall said. “There are legitimate issues to talk about, but this is clearly not what Cassidy is aiming for.”

Cassidy, who has clashed with Kennedy about vaccine policy, may be appealing to the GOP political base ahead of his reelection campaign next year by tying the AMA’s positions on transgender health and diversity, equity and inclusion to questions about CPT codes, Kendall said.

But for some conservatives, the system itself is objectionable enough.

No private organization should have so much sway, said Robert Moffit, a senior research fellow at the conservative Heritage Institute. CMS could take over CPT codes as an alternative, he said.

“What we’re really dealing with here is the fact that back in 1983 the government basically created a private monopoly. And, boy, it is past time to look at that and the consequences of it,” Moffit said. “The organization is actually making a lot of money on this government-sponsored monopoly, which is basically the CPT code system. And what are we getting back in return?”

Capitol Hill politics are highly charged and deeply partisan at the moment, but there could be bipartisan support for changing the system if Democrats decide it could lower healthcare costs. It could become a priority if Cassidy attracts enough a to elevate the issue in the wake of the ongoing government showdown.

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