My son was born premature. The way they explained it to me is: for example when he was technically 3months old they said he was 1.5months. So if he didn't meet the normal 3month milestones it was because he was early. They counted the months based on when his due date actually was. They only did that till he caught up which didn't take too terribly long but they wanted to assure me that he was on track. That being born premature means it might take him a little bit to meet the normal milestones.
I hope i explained it good enough. :)
If a baby due March 1 (if born full term) is in fact born six weeks early on January 16, the pediatrician might say on March 28 that the baby is ten weeks old, but 4 weeks, adjusted. (Meaning, if the baby had been born at full term, the baby would only be 4 weeks old on March 28.) This is, as Danika said, so a mom who is looking at where her baby should be in development milestones will not freak out that her preemie isn't hitting 10-week milestones. A premature baby will hit their milestones at the same time as if he or she had been born on their full-term birth date.