Sunday, March 1, 2020

Medicare (Dys)Regulation and COVID-19 Coronavirus testing

Update March 4, 2020:  Pence announces coronavirus is a required essential health benefit under private plans, Medicare, Medicaid: here.

Update March 6:  CMS announced on March 5 it would pay for new U-codes U-0001, U-0002, separately in the hospital outpatient setting details here.


With a rapidly emerging public health crisis emerging around COVID-19, how does molecular testing engage with CMS policy?    At least some CMS policies appear to be clearly non-helpful.

  • See also a prior blog in which I discussed the promise of genomic approaches to COVID-19 - here.

CMS Bundles All Molecular Infectious Disease Testing in Most Settings!

In hospitals, molecular testing for infectious disease is bundled to the hospital's overhead costs for each patient (e.g. bundled under a Diagnosis Related Group or DRG).   Few people outside of the lab industry or Medicare policy specialists understand the further extensions of this bundling concept, however. 

Dating back many years, CMS also bundles tests performed by the hospital within three days prior to admission, even if the tests were otherwise payable.   Beginning in 2014, CMS bundles all microbiology tests performed in emergency rooms and other hospital-based outpatient encounters (e.g. an on-site or off-site hospital clinic).   The hospital gets a payment for an encounter or office visit, but any lab tests ordered and performed by the hospital get no additional payment.  (The office payments were raised a bit in 2014 to cover average lab costs.)   The only exception is human genetic tests, and a COVID-19 PCR test is not a human DNA or RNA test.

In short, hospitals are on the hook for testing for  COVID-19 and are even incented not to do so, unless absolutely necessary.   Outpatient visit G0463 (hospital outpatient clinic visit) pays about $115 (APC 5012), so ordering multiple $30 to $120 molecular virology tests could exceed CMS's payment for the whole visit, including time, nursing staff, and overhead.  Doctors would be highly disincented from ordering a viral pathogen screen for $142 (87631) if the whole payment from CMS is only $115 all-inclusive.

MolDx Policy L37713 Provides Very Limited Coverage for 
Office-Based Molecular Virology

About 30 states participate in the MOLDX policy system for molecular testing.  Policy L37713 covers molecular virology for respiratory disease, but only in the "free-standing" setting - not in the hospital inpatient setting, or emergency room, or hospital outpatient clinic (due to bundling as just explained).

Policy L37713 has very narrow coverage for any molecular testing of respiratory illness in Medicare outpatients, a position that drew stormy comments from a range of US associations, including American Society for Microbiology, Infectious Disease Society of America, and other leading organizations.   The policy and the range of association disagreements are placed in a cloud zip file here.  Net-net, when multiple pathogen and multiple pathogen testing is required, it's generally not paid for by CMS.

In L37713, CMS focuses on identifying viral illness only when a specific antiviral drug is available.  When a specific antiviral drug is not available, CMS states that the need for identify the causative organism is minimal ("viruses cause most respiratory infections, so the diagnostic role of laboratory investigation is limited.")  Specifically, monitoring outbreaks to identify the cause of the viral pneumonia and improve early detection is "not a Medicare benefit."

It appears that if or when adding coronavirus drives a test order from 5 to 6 viral pathogens, it becames unpayable (payment falls from $142 under code 87631 to $0 under code 87632).

AMA CPT Coding

Infectious agent DNA/RNA probe detection runs generally from 87471 forward.  In a nutshell, for tests for viruses not yet codified by name, payment per test is low and inadequate.  Options include 87797 (direct probe, per organism), 87798 (amplified probe, per organism), and 87799 (quantitative DNA/RNA probe, per organism.) CMS pays $30, $35, and $43 respectively.   There are test codes for multiple unique concurrent respiratory viral tests (87631 3-5 targets, 87632, 6-11 targets, and 87633 12-25 targets) which pay $142, $218, and $416, but these are generally not paid by CMS (except for 87631; for rules, see LCD zip file listed above).