A Comprehensive Guide on E/M Codes in Medical Billing in 2026

E/M codes in medical billing are CPT evaluation and management codes used to report physician and non-physician practitioner visits to payers for reimbursement. E/M codes are the single highest-volume code category in physician billing, covering office visits, hospital encounters, nursing facility visits, preventive care, and telehealth. Per the CMS Medicare Fee-for-Service Supplemental Improper Payment Data, the improper payment rate for E/M codes is 10.3%, with incorrect coding accounting for 49.1% of those improper payments. 

This guide covers what E/M codes are, how level selection works in 2026, the 3 MDM elements, E/M categories beyond office visits, and the 5 most common E/M billing errors.

What Are E/M Codes in Medical Billing?

E/M codes are CPT codes that describe the cognitive work of evaluating a patient’s condition and managing their care, as distinct from procedural CPT codes that describe a specific technique or intervention. The E/M section of CPT covers codes 99202 through 99499 and is organized into code families by care setting and patient type. The 5 E/M code families physicians bill most frequently are:

• Office or other outpatient visits: CPT 99202-99205 for new patients and 99211-99215 for established patients. These are the most commonly billed E/M codes in physician practice.
• Hospital inpatient and observation care: CPT 99221-99223 for initial hospital or observation care and 99231-99233 for subsequent hospital or observation care. Since January 1, 2023, inpatient and observation codes have been merged into a single code set.
• Emergency department visits: CPT 99281-99285, selected by MDM only. Time-based selection does not apply to emergency department E/M codes.
• Nursing facility visits: CPT 99304-99306 for initial nursing facility care and 99307-99310 for subsequent nursing facility care.
• Preventive medicine visits: CPT 99381-99387 for new patients and 99391-99397 for established patients, selected by age group and not by MDM or time.

E/M codes differ from procedural CPT codes in that reimbursement is determined by the complexity of the physician’s cognitive work, not the technique performed. The same office visit can bill at CPT 99212 (straightforward MDM) or CPT 99215 (high-complexity MDM) depending entirely on documented MDM complexity or total time. Per the CMS CY 2026 Physician Fee Schedule, the non-facility rate for CPT 99214 is $148.04 vs. $93.48 for 99213, a $54.56 per-claim difference that compounds across every misleveled encounter.

How Are Office Visit E/M Levels Selected in 2026?

Office and outpatient E/M levels are selected using 1 of 2 methods: medical decision making (MDM) or total time spent by the physician on the date of the encounter, per the AMA E/M guidelines revised January 1, 2021 and confirmed by CMS in the CY 2026 Physician Fee Schedule Final Rule. The physician uses whichever method supports the higher level. History and physical exam must be performed as medically appropriate and documented, but no longer determine the E/M level.

When using total time, the physician must document the total time personally spent on the date of the encounter, including time before, during, and after the visit on that calendar date. Established patient time thresholds: 99212 = 10-19 min; 99213 = 20-29 min; 99214 = 30-39 min; 99215 = 40-54 min. New patient thresholds: 99202 = 15-29 min; 99203 = 30-44 min; 99204 = 45-59 min; 99205 = 60-74 min. Total time must be documented in the note; a claim selecting level by time without a documented time figure cannot be defended on audit.

What Are the 3 Elements of Medical Decision Making?

Medical decision making (MDM) is determined by 3 elements: the number and complexity of problems addressed, the amount and complexity of data reviewed and ordered, and the risk of complications and morbidity or mortality. Per the CMS Evaluation and Management Services MLN (MLN006764). The MDM level requires 2 of the 3 elements to meet or exceed the threshold for the selected code level. The 4 MDM levels are:

• Straightforward MDM (99202/99212): 1 self-limited or minor problem; minimal or no data; minimal risk. Example: URI with no complicating factors.
• Low complexity MDM (99203/99213): 2 or more self-limited problems, or 1 stable chronic illness, or 1 acute uncomplicated illness; limited data; low risk (e.g., OTC drug). Example: stable hypertension medication refill.
• Moderate complexity MDM (99204/99214): 1 or more chronic illnesses with exacerbation, or 2 or more stable chronic illnesses, or 1 undiagnosed new problem; moderate data including independent test interpretation; moderate risk (e.g., prescription drug management). Example: diabetic patient with worsening A1C requiring medication adjustment.
• High complexity MDM (99205/99215): 1 or more chronic illnesses with severe exacerbation, or illness posing a threat to life or function; extensive data including external physician test interpretation; high risk (e.g., drug therapy requiring intensive monitoring or hospitalization decision). Example: decompensated heart failure requiring urgent medication changes.

HCPCS add-on code G2211 is separately billable with E/M codes 99202-99215 when the physician serves as the continuing focal point for all the patient’s care or provides ongoing care for a single serious or complex condition. G2211 is not payable when the E/M base code is reported with modifier 25, per CMS Change Request 13473.

What E/M Categories Exist Beyond Office Visits?

The 4 most commonly billed E/M categories outside office visits are:

1.   Hospital inpatient and observation (99221-99233): per-day codes billed once per calendar date per physician group. Level is selected by MDM or time. Since January 1, 2023, inpatient and observation codes are a single merged code set.
2.   Emergency department visits (99281-99285): level is selected by MDM only; time-based selection does not apply. ED codes are not subject to the new vs. established patient distinction.
3.   Nursing facility visits (99304-99310): per-day codes with level selected by MDM or time. Initial care uses 99304-99306; subsequent care uses 99307-99310.
4.   Preventive medicine visits (99381-99397): level is selected by age group, not MDM or time. New patients use 99381-99387; established patients use 99391-99397. When a preventive visit includes a separately identifiable problem-focused E/M, modifier 25 must be appended to the problem-focused E/M code. 

What Are the 5 Most Common E/M Billing Errors?

1. Selecting level by time without documenting total time: total time must appear in the medical record when time is used for level selection. A note without a documented time figure cannot support the billed level on audit. Fix: add a total time statement to every time-based note.
2. Upcoding MDM complexity: selecting 99214 or 99215 when documented problems, data, and risk only support 99213. Fix: use a structured MDM worksheet at every visit to verify that 2 of the 3 elements meet the billed level’s threshold.
3. Missing modifier 25 on a same-day procedure: without modifier 25, a same-day E/M is bundled into the procedure and denied. Fix: make modifier 25 a required charge entry field whenever an E/M and procedure share a date of service.
4. Incorrect new vs. established patient designation: a new patient has not received professional services from the same physician or same-specialty group member within the past 3 years. Billing a returning patient as new to access higher fee schedule rates constitutes upcoding. Fix: verify the 3-year rule at every check-in.
5. Billing G2211 with modifier 25: G2211 is not payable when the associated office E/M base code is reported with modifier 25, except when modifier 25 is used because an allowed Medicare Part B preventive service was also provided. Billing G2211 alongside a modifier 25 E/M for a non-preventive same-day procedure produces a denial of G2211. Fix: build a claim scrub rule that flags G2211 combined with modifier 25 outside the allowed preventive service exception.

Conclusion

E/M codes are the highest-volume and highest-audit-risk code category in physician billing. The 2026 framework requires selecting the office visit level by MDM or total time, documenting whichever method is used, and appending modifier 25 whenever a procedure and separately identifiable E/M share a date of service. Every E/M claim submitted without a documented MDM worksheet or total time figure is a potential audit finding.

Physicians should reference the CMS Evaluation and Management Services MLN (MLN006764) and the CMS E/M Visits page for complete MDM tables, time thresholds, and G2211 billing guidance.

Consult a certified medical coder (CPC or CCS) for practice-specific E/M level selection decisions.

FAQs

What Are E/M Codes in Medical Billing?

E/M codes are CPT codes reporting the cognitive work of evaluating and managing a patient’s condition, covering office visits (99202-99215), hospital care (99221-99233), ED visits (99281-99285), nursing facility visits (99304-99310), and preventive care (99381-99397).

How Is the E/M Level Selected in 2026?

Office and outpatient E/M levels are selected using either medical decision making (MDM) or total time spent by the physician on the date of the encounter, and history and physical exam no longer determine the visit level, though they must be performed as medically appropriate and documented per CMS guidelines in effect for 2026.

What Are the 3 Elements of MDM for E/M Coding?

The 3 MDM elements are the number and complexity of problems addressed, the amount and complexity of data reviewed and ordered, and the risk of complications and morbidity or mortality, and 2 of the 3 elements must meet or exceed the threshold for the selected code level per the AMA E/M guidelines effective January 1, 2021.

What Is the Improper Payment Rate for E/M Codes?

The improper payment rate for E/M codes is 10.3% per the CMS 2024 Medicare Fee-for-Service Supplemental Improper Payment Data, with incorrect coding accounting for 49.1% of those improper payments and a projected total of $3.9 billion.