Lawsuit Over Medical Billing Codes Could Reshape Health Care Price Transparency

by Cameron Smith and Stephen T. Rutkowski

A public advocate group, PatientRightsAdvocate.org (“PRA”), has filed a lawsuit in federal court in Illinois challenging certain copyrights held by the American Medical Association (“AMA”) over codes and descriptions used in medical billing. The advocate group alleges that it intends to publish a copy of the 2026 Current Procedural Terminology (CPT) coding guidelines on its website for the public to access but cannot do so because of the AMA’s copyrights. The lawsuit has wide-ranging implications for health plan participants, patients trying to understand medical bills, and industry insiders.   

What are CPT Codes, and How Are They Used in Medical Billing? 

Current Procedural Terminology (“CPT”) is a series of codes and descriptions regarding the types of procedures performed on patients that are used in medical billing by healthcare providers. The AMA established CPT codes to standardize the reporting of medical services. Healthcare providers use these codes to track and request payment from insurers such as Medicare. AMA releases an updated CPT each year.  

According to the lawsuit, the AMA first introduced CPT codes in 1966, and by the 1980s, the Government had begun incorporating them into their Medicare and Medicaid regulations. The government now generally requires physicians to use these CPT codes when submitting claims for reimbursement for their services under Medicare and Medicaid. Providers and hospitals often obtain access CPT codes via licensing agreements. Individuals can purchase a physical copy of the 2027 CPT Professional manual for $137.89. The nonprofit organization alleges that AMA’s revenue is nearly $300 million per year, with a significant portion of that revenue coming from licensing fees. 

What copyright claims are raised against the American Medical Association? 

PRA seeks a declaratory judgment that CPT codes are  not protectable under the copyright laws because of three related reason: first, the AMA exercises lawmaking authority in issuing them; second, because they are incorporated into law; and third, because the federal government jointly authored them. The nonprofit argues that AMA has no legal right to charge the public for access to CPT codes. Specifically, PRA argues that the public should not have to pay to read codes that are legally required to be followed. PRA contends that AMA cannot stop the organization from scanning and publishing the codebook online in a free, searchable, user-friendly format. The nonprofit also argues that, even if the AMA does have valid copyright in CPT, its use of the codes falls within the fair use exception to copyright. Lastly, the nonprofit argues that AMA engaged in copyright misuse by failing to follow a prior court decision on the topic of the AMA’s CPT copyrights.  

The AMA is expected to argue that its CPT codes and descriptions are proprietary because the AMA spends significant resources in developing them, including through convening panels of physicians, insurance payers, and coders to evaluate the current system, revise existing code descriptors, and retire outdated ones. The AMA further asserts that the CPT descriptors are part of a living system that requires frequent maintenance to remain current. For 2026, AMA states that 288 CPT codes were either added or revised. In addition, AMA is expected to argue that mere incorporation into federal laws or regulations does not destroy their intellectual property rights.  

What does Federal Law Say? 

The current lawsuit against AMA is currently pending; however, federal courts have weighed in on this issue before. In 1997, Practice Management Information Corporation (“PMIC”) sued the AMA alleging, in part, that its copyright should be invalid because federal law mandated its use for Medicare and Medicaid claims. The Ninth Circuit disagreed with PMIC, stating that AMA’s rights “pose[] no realistic threat to public access.” The Ninth Circuit acknowledged there could be a due process argument for free access to the law that may be available, but the plaintiff, PMIC, was not merely seeking to access the codes; it was looking to redistribute them.   

Conversely, in Georgia et al. v. Public.Resource.org, a Georgia Commission sued Public.Resource.org (“PRO”) for publishing a digital copy of the Official Code of Georgia Annotated (“OCGA”) online, allowing the public to download the version free of charge. The Commission argued that PRO had committed copyright infringement by publishing copyrighted text, whereas PRO argued that the OCGA, including the annotations, are part of the public domain. The Supreme Court held that annotations to legislative work product are ineligible for copyright protections because if they were, other legislative work product, such as proposed bills, would only be accessible to the public through a charge. The court analogized the case to scenario whereby a Georgia citizen is interested in learning about his legal rights but is unable to do so, due to hefty access fees.  

What does this mean for Patients, Health Plan participants and Whistleblowers? 

It is important for patients, health plan participants, and potential whistleblowers to have access to important information about medical billing. And it is also important for CPT codes to be precise and accurate. Mislabeling or submitting a false CPT code to a government insurer like Medicare or Medicaid may violate federal laws such as the False Claims Act (“FCA”). The FCA grants private citizens the ability to bring whistleblower lawsuits to recover money against firms or healthcare providers who engage in illegal overbilling. Importantly, a whistleblower must know the reason why the billed codes were false, or why a different code should have been used instead. If the PRA is allowed to publish CPT codes, this may make it easier for insiders and other individuals to spot overbilling and report the conduct to the government.  

How Can Miller Shah Help? 

Medicaid and Medicare overbilling is a common form of fraud which deprives government programs of taxpayer money used to support legitimate patient care. 

Miller Shah is dedicated to combating healthcare fraud through the whistleblower provisions of the FCA. If you would like more information, contact us online or call (866) 540-5505 to arrange a consultation.