Reimbursement For Molecular Testing

In common with all areas of medical practice, reimbursement for molecular testing at the federal level (Medicare) is based on the current Common Procedural Terminology (CPT) coding system. State providers such as Medicaid and private insurance companies generally follow the same process. Under CPT coding, a charge and its payment are based on the number of individual items of service provided. Each step in a typical molecular assay ranging from extraction of DNA to performance of a polymerase chain reaction to gel electrophoresis and final result interpretation has a unique CPT code and an associated reimbursement based (in the case of Medicare) on the published fee schedule. Therefore, the Medicare reimbursement rate is calculable and is based on the individual steps in an assay. Private insurance companies may reimburse at a higher rate than federal payers. The CPT codes are updated annually by the American Medical Association, which retains copyright on the codes. Because of the rapid advances in molecular testing, it is not uncommon for laboratories to use methods that are not listed in the CPT guide. In this case, it may be necessary to seek consultation billing experts on choosing the appropriate fee codes.

Not uncommonly, genetic test prices from commercial laboratories are well above those that can be justified from published fee schedules. Although this may be perfectly legal, it can lead to significant problems for patients whose insurance companies (including Medicare) may not cover the full cost of the testing. In this situation the patient may have to pay out of pocket for part or all of the cost of the test if it is decided that the testing is essential. This situation can pose a financial risk for hospitals and clinics if they refer a sample for testing to a reference laboratory and thereby possibly incur the charges for a test. One possible option is to notify the patient and ordering physician that such tests are unlikely to be covered by insurance and determine how they propose to pay for testing. For Medicare patients, an advance beneficiary notice (ABN) may be used to formally notify a patient that the test is considered to be a noncovered service [8] . These types of situations should be discussed with hospital management.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

Get My Free Ebook


Post a comment