Friday, October 13, 2017

CMS Requires MACs to Gather Data About Lab Tests with Unlisted Codes

On October 13, 2017, CMS released CR10232/Transmittal 3881, updating the Claims Processing Manual to require submission of data for lab tests processed with "unlisted codes."

The Transmittal is online here.  A cloud archive copy is here.  The relevant new text is:

Instructions for Not Otherwise Classified (NOC) Codes – Any unlisted services or procedure code. Note:  When reporting NOC codes, this field must be populated as specified below. 

When billing for unlisted laboratory tests using a NOC code, this field MUST include the specific name of the laboratory test(s) and/or a short descriptor of the test(s). Claims for unlisted laboratory tests that are received without this information shall be treated according to the requirements found in Pub. 100-04, Medicare Claims Processing Manual, Chapter 1, Section 80.3.2 and “returned as unprocessable.” Section 216(a) of the Protecting Access to Medicare Act of 2014 (PAMA) requires reporting entities to report private payor payment rates for laboratory tests and the corresponding volumes of tests. In compliance with PAMA, CMS must collect private payor data on unique tests currently being paid as a NOC code, Not Otherwise Specified (NOS) code, or unlisted service or procedure code. 

Note the language the instruction is couched in:  Labs are required to report private payer rates...CMS must collect private payer data on unique tests paid with a NOC code.

This is a change in interpretation, as CMS did not previously require this reporting in the interval since PAMA was passed in 2014.  In June 2016, CMS wrote, "Data on tests that are billed using unlisted CPT codes or NOC codes would not be considered applicable information and would not be reported."  (81 FR 41053, 6/23/2016).

Almost All CMS Unlisted Code Payments Fall Under MOLDX

In CY2015, CMS paid $165M under molecular unlisted code 81479 (here).  However, nearly all of this was paid under the MolDX program (here).  Thus, as a practical matter, the CMS transmittal will have little impact outside of MolDX states.

MolDX has a special coding rule that 1-4 genes should be reporting with an unlisted code (here) rather than CPT stack coding. For example, we've previously noted that Ambry Genetics bills 80% of its Medicare services as MolDX NOC codes (here).   In addition, MolDX requires at least six tests to be submitted with -22 modifiers (e.g. Qiagen KRAS 81275-22; here.)

Foreseeable Problems

Parallel instructions (in the same claims manual) require reporting of drug name with each unlisted code use of a drug.  On the other hand, drugs have fixed precise names, whereas lab tests often do not, although they might have generic names (EGFR sequencing) or in some cases trademarked brand names.
  • Labs may repeatedly update versions of their test (e.g. a tumor gene panel test may be frequently updated, with 30 genes, 31 genes, 32 genes...) so there will be some questions about what CMS intends a "unique" test to be.  
  • In addition, CPT instructions require all additional tests performed, that don't have individual codes, are to be billed with ONE NOC code (or NOC code, unit of 1) so many individual tests may fall under one NOC code on one claim.  CMS seems to recognize that, asking for collection of data on the "test or tests" billed with the NOC code.
    • The MolDX program is sometimes exuberant in its required use of NOC codes even when services could be otherwise described by CPT gene stacking or CPT panel codes. 
  • CMS might use the data to retrospectively enforce whether gene panel tests are correctly coded, e.g. BRCA or Lynch gene panels.

This is the template that MACs should use to report 81479 and other unlisted lab payments.  As noted above, nearly all unlisted lab tests are paid by MolDX MACs.  And MolDX MACs already require comment field specificity, e.g. Z codes.