CPT Codes 99202–99205: Time, MDM, Documentation & Reimbursement — A Complete Expert Guide

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Written by a Healthcare Billing Specialist with Firsthand E/M Coding Experience

Introduction: Why These Four Codes Define Your Outpatient Revenue

I have spent years helping practices untangle their outpatient billing, and no codes generate more confusion or more revenue risk than CPT 99202 through 99205. These are the new patient office visit codes that anchor almost every outpatient practice's claim volume. Get them right and your revenue cycle stays healthy. Get them wrong and you face denials, audits, or quiet patterns of undercoding that bleed thousands of dollars from your practice every year.

Since the AMA overhauled E/M coding guidelines in 2021, and CMS adopted those changes for outpatient services, the entire framework for selecting these codes shifted. History and physical exam components no longer drive code selection. Time and Medical Decision Making (MDM) do. That change freed clinicians from documentation busy-work, but it created new confusion about what actually needs to be in the note and why.

This guide is for clinicians who want to understand how their documentation choices affect code selection, for billers who review those notes daily, and for administrators who need to understand the compliance implications of both.

Understanding CPT 99202–99205: What Each Code Represents

These four codes cover new patient office or outpatient visits. A new patient is one who has not received professional services from the provider or another provider of the same specialty in the same group within the past three years. That definition matters and I always confirm it before coding.

99202 is the lowest level of meaningful new patient visit. It requires straightforward MDM or 15 to 29 minutes of total time. In practice, this fits simple, self-limited presentations a healthy young adult with a mild upper respiratory infection, or someone presenting with a single acute issue with a low-risk management plan.

99203 steps up to low complexity MDM or 30 to 44 minutes. This captures presentations with one stable chronic condition being newly addressed, or an acute problem needing a modest workup. A new patient with well-controlled hypertension needing medication established often fits here.

99204 requires moderate complexity MDM or 45 to 59 minutes. This is the workhorse of primary care new patient visits a patient with two or three uncontrolled chronic conditions, someone needing new prescription drug management, or a patient requiring review of external test results that meaningfully changes the plan.

99205 is the highest level, requiring high complexity MDM or 60 to 74 minutes. I apply this to patients with severe acute illness posing a threat to life or bodily function, or new patients with highly complex chronic conditions requiring extensive data review and high-risk decisions newly diagnosed malignancy, multi-system failure, or a complex psychiatric crisis.

The key distinction across these levels is not simply "how sick is the patient" but "how complex is the clinical decision-making required to manage this patient today."

Time vs. MDM: Understanding What Drives Your Code Level

This is the section I wish every clinician would internalize, because the 2021 E/M changes were largely about giving providers a choice — you can let MDM determine your code level, or you can use total time. You do not use both simultaneously; you pick the one that better reflects the encounter.

Defining Time in E/M Coding

Under current CPT guidelines, time for office visit E/M codes is defined as the total time spent on the day of the encounter including face-to-face time with the patient, reviewing records before the visit, ordering and reviewing test results, counseling, and documenting the note. This was a major shift from the old rules, which counted only face-to-face time.

What this means practically: if I spend 20 minutes reviewing a complex new patient's outside records before they walk in, 30 minutes with them in the room, and 10 minutes documenting after, that is 60 minutes of total time and I can use that to support 99205. The time must be documented. I record start and stop times or a specific total time in every note where time is the basis for code selection.

Defining Medical Decision Making

MDM evaluates three elements: the number and complexity of problems addressed, the amount and complexity of data reviewed and ordered, and the risk of complications and morbidity associated with the management. For each MDM level, two of the three elements must be met.

Straightforward MDM (99202): one self-limited or minor problem, minimal data, minimal risk.

Low MDM (99203): two or more self-limited problems, or one stable chronic illness, or one acute uncomplicated illness with limited data and low risk.

Moderate MDM (99204): one or more chronic illnesses with exacerbation or progression, or two or more stable chronic illnesses, or an undiagnosed new problem with uncertain prognosis with moderate data (including independent review of external results or independent interpretation of tests) and moderate risk (new prescription drug management).

High MDM (99205): one or more chronic illnesses with severe exacerbation, or an acute or chronic illness that poses a threat to life or bodily function — with extensive data and high risk (drug therapy requiring intensive monitoring, or decision for hospitalization or DNR).

When Time Should Drive Code Selection

I choose time-based coding when clinical complexity is difficult to capture through MDM elements alone, but the time spent was genuinely substantial. This is most common when I spend significant time counseling, coordinating care with multiple specialists, or reviewing a large volume of outside records.

Example: a new patient presenting with anxiety and depression where most of the visit involves extensive counseling and medication risk discussion. The MDM might technically reach moderate complexity, but if total time reaches 60 minutes, coding 99205 based on time is legitimate and better reflects the work performed.

When MDM Should Drive Code Selection

I default to MDM-based coding when clinical decision-making is clearly complex, even if the visit was brief. A specialist seeing a new patient with a complicated referral question may spend only 35 minutes but make a high-complexity management decision that supports 99205 on MDM, not time.

The practical rule I follow: evaluate both options for each encounter and choose the one that most accurately represents the work done. Never inflate time documentation artificially, and never force MDM elements that did not genuinely occur.

Documentation Essentials: What the Note Must Contain

Documentation for these codes must do one thing above all else: tell the story of what happened during the encounter and why the clinical decisions that were made were appropriate and necessary. Here is what I always include.

For time-based coding, the note must contain explicit total time documentation. I write: "Total time spent on this encounter, including pre-visit record review, face-to-face time, and post-visit documentation: 52 minutes." That single sentence makes the time claim auditable and defensible.

For MDM-based coding, the note must support each of the two MDM elements claimed. For problems, I document the specific conditions addressed, their acuity, and whether they are new, established, stable, or worsening. For data, I document what I reviewed external records, prior test results, imaging and my independent interpretation. For risk, I document my management decisions and the associated risk new prescription drugs started, drug-drug interactions considered, or the decision to refer for a high-risk procedure.

Chief complaint and history of present illness must be present regardless of code level. These set clinical context. A note that jumps straight to assessment and plan without establishing why the patient came in and what their current situation is will always struggle in an audit.

Assessment and plan must be specific and individualized. I document every condition addressed, the clinical reasoning behind each management decision, follow-up instructions, and patient education provided. Generic statements like "will continue current management" without clinical context are audit red flags.

Common documentation gaps I see: missing or vague time documentation when time is the basis for coding; assessment and plan that lists diagnoses without supporting the complexity of the MDM claimed; data review noted but not described (saying "reviewed records" without documenting what records, from whom, and what was clinically relevant); and risk documentation that does not identify the specific risk element that qualifies the MDM level.

Reimbursement Rules and Compliance

Correct code selection directly determines reimbursement, and that relationship is not simply about billing higher codes. It is about billing the right codes for the right encounters consistently.

CMS and the Medicare Physician Fee Schedule set the baseline reimbursement rates for these codes. As of 2025 and into 2026, the national average work RVU values which drive reimbursement increase meaningfully across the 99202–99205 spectrum. 99202 carries roughly 0.93 work RVUs; 99205 carries 3.17 work RVUs. That is a more than threefold difference, which means systematic undercoding from 99204 to 99203 across a busy primary care practice translates to substantial lost revenue over a year.

Commercial payer variations exist and matter. Most commercial payers have adopted the 2021 AMA E/M guidelines, but the speed and completeness of that adoption varies. Some payers still apply additional documentation requirements or have specific policies around time-based coding. I always verify each major payer's current E/M policy annually and note any deviations from CMS guidelines.

Prior authorization is rarely required for E/M codes, but payers do conduct post-payment audits based on coding patterns. A practice billing 99205 for 60 percent of new patient visits will attract scrutiny faster than one whose distribution reflects the natural bell curve of clinical complexity. I monitor my coding distribution quarterly and benchmark it against national averages.

Avoiding undercoding: I encounter undercoding far more often than overcoding. Providers who routinely select 99203 for encounters that genuinely support 99204 or 99205 leave significant reimbursement on the table. The solution is not to upcode randomly it is to document thoroughly enough that the appropriate higher-level code is naturally supported by the note.

Common Mistakes and How I Avoid Them

Selecting the code before completing the note. This is backwards. Code selection should follow documentation, not precede it. I always complete the note first, then apply the coding criteria to what is documented.

Equating visit length with complexity. A 60-minute visit is not automatically a 99205. If the time was spent on a straightforward problem with extensive patient counseling, the MDM may only support 99203 and if time is used instead, the documentation must reflect 60 minutes of legitimate work on that encounter.

Ignoring the "addressed at the encounter" requirement. For a condition to count toward the MDM problems element, it must be actively managed or considered during that visit. A laundry list of the patient's chronic conditions that are not touched during the encounter does not inflate the MDM level.

Weak data documentation. For moderate and high MDM, the data element is where many notes fall short. Reviewing an external specialist's note counts toward the data element but only if I document that I reviewed it, what it contained that was clinically relevant, and how it influenced my management. "Reviewed outside records" is not sufficient documentation.

Failing to document risk explicitly. Prescribing a new medication is a moderate-risk activity that supports 99204. But if the note does not document that a new medication was started or that an existing prescription-drug therapy was modified the risk element cannot be coded. The management decision must be visible in the note.

Practical Tips for Clinical Coders and Providers

Document the thought process, not just the conclusion. A note showing clinical reasoning why I chose this diagnosis, why I selected this medication over alternatives, what risk factors I weighed supports higher MDM levels far more effectively than one that lists findings without context.

Use structured templates thoughtfully. Templates that prompt each MDM element help ensure nothing is missed, but they must be individualized for each patient. A template completed identically for every patient is a compliance liability, not an asset.

Conduct regular self-audits. Every quarter, I pull a sample of claims across the 99202–99205 range and review the notes against coding criteria. When I find a pattern of gaps, I correct my documentation habits before a payer does.

Educate providers on the MDM framework. Many clinicians document excellent care but do not understand how it maps to MDM elements. A brief education on the three MDM components problems, data, risk and how to make each visible in the note translates directly into more accurate coding without changing the clinical work at all.

Conclusion: Accuracy Here Is Non-Negotiable

CPT codes 99202 through 99205 sit at the intersection of clinical care, documentation, and revenue. Getting them right is about accurately representing the work you do, complying with the rules governing that representation, and protecting your practice from the financial and legal consequences of systematic coding errors in either direction.

The framework is clear once internalized: understand the clinical threshold each code represents, choose Time or MDM based on what genuinely reflects the encounter, document the specific elements supporting your chosen pathway, and audit your own patterns regularly. That discipline, applied consistently, separates practices with clean claim rates and sustainable revenue from those perpetually reacting to denials and audit demands.

The work you do in that exam room is valuable. Your documentation should prove it every time.

Disclaimer: This article is for educational purposes and reflects professional billing experience. It does not constitute legal or compliance advice. Always consult current CPT guidelines, your MAC's LCDs, and payer-specific policies for guidance applicable to your practice.

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