Thursday, December 29, 2016

CMS Tweaks Hospital Outpatient Lab Test Bundling Rules

In November 2016 rulemaking for hospital outpatient policy, CMS tweaked its rules for the bundling of laboratory tests related to hospital outpatient encounters.

The 14-day rule has been in effect since around 2007 and required that only hospital outpatient facilities could bill for tests performed on hospital outpatient specimens.    In 2014, CMS upped the game by defining all hospital outpatient lab tests as "bundled" and not paid separately, not even to the hospital outpatient center, with a few exceptions.

I've put the new rulemaking for CY2017 in the cloud, here, and discuss after the break.

The rulemaking appears at 81 Fed Reg 79592, November 14, 2016.

Since 2014, CMS has bundled clinical laboratory tests based on specimens from the outpatient setting.  They made exceptions for tests ordered by a separate practitioner for a purpose (diagnosis) unrelated to a primary outpatient procedure.  (For example, the patient gets wound surgery from Dr. A, but has been carrying around a scrip for a cholesterol test from Dr. B for a few days, and wants it done now.)   CMS also excludes molecular pathology tests, which it defines by CPT code ranges (this has gotten trickier as new and additional categories of genomic tests are created by AMA CPT).   CMS excludes "human" molecular tests - viral and bacterial genomic tests are bundled - though they usually omit the word "human."

The New News

Cancel Unrelated Test Exception.  For CY2017, CMS is canceling the exception for tests ordered by a different physician and different purpose.   This probably does not have a lot of impact in terms of claims volume, but the reasoning was a little tortured (patients have functioning human bodies, which are physiologic systems, so all lab tests are therefore "related" to all hospital procedures, clinic visits, or imaging, that might be done.)

ADLTs Waived from Bundling.  CMS also ruled that ADLT tests will be exempt from bundling, but such tests must meet ADLT criteria and be certified as such by CMS (a process that isn't really off the ground yet.)  

There are two classes of ADLTs, (1) sole-source MAAA tests certified as ADLTs by CMS, and (2) FDA-cleared or -approved sole source tests (for example, Mammaprint; Myriad's FDA approved BRCA test; the pending Foundation Medicine test under FDA review, etc).   In both cases, the test must apply for and receive ADLT status; it's not automatic.   (Some tests that would qualify for ADLT status might be just as happy with regular status, as they might prefer trienniel to annual fee reporting under PAMA.)

An Editorial Note

At least one aspect of the bundling rule always seemed unfair to me, for example, patients with HIV, rheumatologic disease, etc, could have hospital outpatient-based specialty office visits that trigger only $80 or $90 dollar facility fees, but the patients $100-200 or more in required sophisticated laboratory tests.   That is, there would be foreseeable and predictable situations where the clinic would lose money on certain identifiable classes of Medicare patients and might need to avoid them.