The CPT Copyright Lawsuit: What It Means for Medical Billing in 2026

What Is the CPT Copyright Lawsuit and Why Does It Matter for Medical Billing?

As of August 2026, a nonprofit organization called PatientRightsAdvocate.org has filed a federal lawsuit against the American Medical Association seeking to invalidate the AMA’s copyright on CPT codes and publish them online for free. The lawsuit, filed in the U.S. District Court for the Northern District of Illinois, argues that CPT codes are so deeply embedded in federal and state law that they no longer qualify for copyright protection. If the suit succeeds, it could eliminate the licensing fees that every billing company and practice currently pays to use the coding system that Medicare, Medicaid, and commercial payers all require.

• Who filed it: PatientRightsAdvocate.org, a Massachusetts-based nonprofit focused on healthcare price transparency, filed the lawsuit in mid-August 2026.
• What they want: The group wants to scan and publish the full CPT codebook online for free, arguing that codes incorporated into law should not be locked behind a paywall.
• Why CMS is watching: In its CY 2027 Physician Fee Schedule proposed rule (CMS-1848-P), CMS solicited public comments on alternatives to CPT, citing concerns about federal reliance on a private organization’s proprietary system.

What Happened With the CPT Lawsuit

The lawsuit centers on a legal argument that has gained momentum in recent years: when a private standard becomes part of the law, the public should be able to access it without paying for a license. CPT codes are the billing language that CMS requires for Medicare claims, that state Medicaid programs mandate, and that virtually every commercial payer in the country uses for adjudication. The AMA maintains and updates the CPT system annually, and it charges for access. According to reporting from Healthcare Dive, an individual copy of the 2026 CPT Professional Edition costs $137.89. Practices that need electronic access, which is nearly every practice running a modern EHR or billing platform, pay additional annual licensing fees plus per-user charges. The AMA reported $296.4 million in revenue from its books and digital content category in 2025, and the lawsuit alleges that CPT licensing accounts for the vast majority of that figure.

PatientRightsAdvocate.org is building its case on two legal theories. First, the nonprofit argues that CPT codes no longer qualify for copyright protection because they have been so thoroughly incorporated into law that they function as a legal requirement, not a creative work. Second, even if the copyright is technically valid, the group argues that publishing the codes for free constitutes fair use because the public needs access to understand the rules governing their own healthcare billing. The legal ground here is not untested. In April 2026, the Third Circuit Court of Appeals denied a preliminary injunction against a company called UpCodes that had published incorporated technical standards online, finding that free public dissemination of standards woven into law likely qualifies as fair use. That ruling does not bind the court hearing the CPT case, but it signals a direction.

The timing matters for another reason. In the CY 2027 PFS proposed rule released on July 14, 2026, CMS included a formal request for information asking stakeholders about alternatives to CPT. The agency referenced what it called a longstanding concern about federal reliance on a private organization with a conflict of interest in setting the codes that determine Medicare payments. That language from CMS itself adds regulatory weight to the legal challenge.

Who Does This Affect?

The short answer is everyone involved in medical billing. CPT codes are not optional. They are the mandatory coding language for professional claims submitted to Medicare, Medicaid, and the overwhelming majority of commercial payers. If you run a medical practice, you use CPT codes every time you bill for a service. If you operate a medical billing company, you pay for CPT access through licensing agreements that cover your software, your staff, and your clients.

In our experience matching providers with billing partners, CPT licensing is one of the costs that billing companies build into their service pricing. Smaller billing companies may absorb a disproportionate share of that expense relative to their revenue, and those costs eventually reach the practices they serve through higher billing service rates. The practices most affected are small to mid-size groups that lack the volume to negotiate bulk licensing terms and do not have in-house coding departments that justify enterprise agreements. For context on how billing costs and reimbursement work at the code level, our guide to CPT 99214 billing guidelines and reimbursement walks through what one of the most commonly billed E/M codes actually pays.

The lawsuit also affects EHR vendors, clearinghouses, practice management software companies, and payers, all of which license CPT content to build the systems that process claims. The cost of that licensing is distributed across the healthcare billing supply chain. Whether the lawsuit succeeds or not, the fact that CMS is publicly questioning the arrangement means the conversation around CPT access is no longer theoretical.

Why the AMA Charges for CPT Codes

The AMA’s position is that CPT is a living system that requires continuous investment to maintain. The organization points out that updating CPT is not a passive clerical task. Each year, the AMA convenes panels of physicians, coders, payers, and specialty societies to evaluate new procedures, revise existing code descriptors, and retire outdated ones. For 2026 alone, 288 CPT codes were newly added or revised. The AMA argues that without licensing revenue, the resources to fund that process would disappear, and the coding system that the entire industry depends on would stagnate.

There is substance to that argument. CPT is not a static list. It reflects the way medicine is actually practiced in a given year, including new technologies, revised surgical techniques, and updated evaluation and management guidelines. The 2026 cycle included expanded billing for the G2211 complexity add-on code to cover home visits, new Advanced Primary Care Management (APCM) codes, and updated remote therapeutic monitoring codes. Maintaining that level of clinical specificity does require investment and expertise.

The counterargument from PatientRightsAdvocate.org is that the public should not have to pay to read the rules it is legally required to follow. The group’s founder has stated that CPT licensing fees ultimately increase the cost of healthcare for patients and employers. Senator Bill Cassidy, who chairs the Senate HELP Committee, launched an inquiry in 2025 into what he called the AMA’s monopoly over CPT and pressed the organization to disclose how much it earns from code licensing. The political landscape around this issue has shifted, and the lawsuit is the latest escalation.

What Happens if CPT Codes Become Free?

If the court rules in favor of PatientRightsAdvocate.org, the immediate practical effect would be that the CPT codebook becomes freely available online. That does not mean the coding system itself changes. The codes, descriptors, and guidelines would remain the same. Payers would still require them. CMS would still reference them. The difference is that access would no longer require a license or purchase.

For providers, free CPT access could reduce one line item in operational costs, but the savings would be modest at the individual practice level. The larger impact would be felt by billing companies, EHR vendors, and clearinghouses that currently pay enterprise licensing fees and build those costs into their pricing. Across the billing companies we vet, CPT licensing is baked into platform fees and service contracts. If that cost disappears, competitive pressure would likely push some of those savings through to practices over time.

The bigger question is what happens to CPT maintenance. If the AMA loses a significant revenue stream, the organization would need to find another way to fund the annual update process, or CMS would need to step in. That is where the CMS request for information in the 2027 proposed rule becomes relevant. CMS is already exploring whether the federal government should develop its own coding system or modify its relationship with the AMA. Any transition away from CPT would take years and create significant operational disruption, but the fact that the agency is formally asking the question signals that the status quo is no longer guaranteed. For providers already navigating the proposed 2027 modifier 25 payment reduction, this adds another layer of uncertainty to the billing landscape.

What Providers Should Do Now

The lawsuit will take time to resolve, and no immediate changes to CPT access or requirements will result from the filing alone. That said, there are concrete steps providers and practice managers should take now to prepare for a billing landscape that is clearly shifting.

1. Review your current CPT licensing costs. Know what you are paying for codebook access, electronic licenses, and any per-user fees embedded in your EHR or billing software contracts. This is the baseline for understanding how any change in CPT access would affect your bottom line.
2. Ask your billing company how they handle CPT updates. A billing partner that stays current with annual code changes, including the 288 new and revised codes for 2026, reduces your exposure to denials from outdated coding.
3. Track the CMS comment period on CPT alternatives. The CY 2027 PFS proposed rule comment period closes September 14, 2026. If your specialty society or billing company is submitting comments, understand their position.
4. Strengthen your documentation regardless of the outcome. Whether CPT remains proprietary or becomes free, payers are tightening claim reviews. Industry-wide denial rates rose to 9% in 2026 according to the AMS Solutions benchmark report, up from 7.5% in 2023. Accurate coding and documentation are the primary defense.
5. Evaluate whether your billing setup is built for change. Practices that rely on a single billing resource with no external audit capability are the most vulnerable when coding systems, payer policies, or federal requirements shift. A dedicated billing company provides the infrastructure to absorb these transitions.

Common Misconceptions About CPT Licensing

One question we hear from practice managers is whether this lawsuit means CPT codes are going away. It does not. Even if the court invalidates the AMA’s copyright, the codes themselves remain the standard until CMS formally adopts an alternative. No replacement system exists today, and building one would be a multi-year federal undertaking. The lawsuit is about who pays for access to the existing codes, not about replacing them.

Another misconception is that free CPT access would eliminate the need for professional coding expertise. It would not. The complexity of CPT is not in reading the code descriptors. It is in applying them correctly to clinical documentation in a way that satisfies payer-specific adjudication logic. The 2027 proposed rule alone includes a transition of G2211 from a standalone code to a percentage-based modifier, a proposed 50% reduction on same-day E/M visits billed with procedures, and a conversion factor decrease. Free access to the codebook does not simplify any of that. For an example of how payer-specific coding logic works at the claim level, our breakdown of CO-97 denial code resolution shows how a single adjustment reason code can affect reimbursement across specialties.

Providers also sometimes assume that because they use an EHR with built-in CPT functionality, they are not paying for CPT licensing. In most cases, the EHR vendor has embedded those costs into the platform subscription. The fee may not appear as a separate line item, but it is there. Understanding where CPT licensing costs sit in your technology stack is worth the conversation with your vendor.

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