Friday, December 4, 2020

Better Late than Never: CMS Releases Lab & Physician Code Utilization for CY2018

Since 2014, CMS has released massive data files on the utilization of CPT codes by physicians and labs by calendar year, typically in May on an 18 month delay.    The 2018 data should have appeared in May 2020...or over the was late (blog here).

Well, the CY2018 data is now released at the utilization and payment website here.

  • I've put an Excel copy of the entire 80,000 series lab & path codes in the cloud here.  It's pretty massive (100 mb).
  • I've put a copy of the 81100-81599 series (molecular human codes) plus the three most used PLA codes (0037U, 45U, 47U) in the cloud here.   This mopath file is more manageable at 300kb, 2700 lines.
  • Finally, I've put a copy of the nonspecific codes (8140X Tier 2 plus 81479, 81599) in the cloud here.  Amazingly, spending through these nonspecific codes tallies $340M.  It's a small file at95 kb.
    • The $300M on nonspecific codes in 2018 is nearly as large as the whole molecular spending budget just several years ago (circa $500M in 2016 and 2017).  
  • For Molec Microbiology, see FN1.

My biggest take-home lesson

In 2018, nearly $300M went out under nonspecific codes 81408 and 81479.  

Specifically,  I get $123M (81408) + $148M (81479)  or $271M out of $1.1B total mopath spending (25%).   

If you add in all the 8140X (Tier 2) nonspecific codes, the nonspecific code payments are $339M out of $1.1B, just about one-third.

We Learn More About 81408

A few months ago, CMS released gross national Medicare Part B spending on molecular code 81408 (Tier 2 Level 9 code, mostly ultra rare genes for epilepsy in babies, etc) in CY2019.   Here.  It \was stunning.   Spending on that code rose from $490,000 in 2016 to nearly $300,000,000 in 2019.   See table:

Now, get data for exactly which doctors and labs in which cities garnered payments for 81408 in CY2018, when usage of 81408 was $123,000,000.    We see that payments to major genetics venders (Labcorp, Quest, Myriad, Ambry, Invitae, Bioreference) were essentially nil for code  81408.  And it wasn't payable in any MACs except Novitas and First Coast, the two MACs which didn't have any edits on this $2000 service (as documented by statements in their LCDs - "We have no edits on this code.")  

Spending on 84108 in CY2018 (as it will be in 2019) was nearly 100% in RED states (2016 election). The only exception was New Jersey, but NJ is processed with same edits as Pennsylvania, the 2016 red state in which its MAC resides.  With that quirk, 100% of the 81408 payments went to little-heard-of labs in red states.  Click to enlarge.

While we don't have by-lab data in 2019, we do know that 81408 spending was continuing to grow rapidly from 2017 to 2018 to 2019, and on its way to reaching $300M in 2019 nationwide.  

Again, remember this is for mostly orphan infantile disorders, being tested in Medicare patients, and big labs like Invitae and Ambry are completely absent from the list above.  

While I only have data from a news report, and have no claim to its accuracy, if we look at the #1 lab for 81408, above, it's Performance Laboratories in Oklahoma, and if you google it, you quickly get a headline, "Federal agents raid lab."  The raid was a year after the data I've shown above was known to CMS, and the anomalous payments should have been obviously to a seven-year-old, not requiring big data and AI.  Note that we know that Part B 81408 payments by Novitas MAC in Oklahoma in the next year, 2019, were $63M (!!!).

Other labs in the chart, such as Spectrum and Metric, also show up in DOJ press releases eg this one here.  In the press release, DOJ asserts or alleges:  "[Payments] in exchange for referrals and DNA samples based on a percentage of the revenue the laboratories received from federal health care programs, including Medicare. Once the amount of the bribe was calculated, [persons] drafted and submitted sham invoices to the laboratories that backed into the agreed upon bribe amount and attempted to conceal the scheme through describing various services provided at hourly rates."

Labs billing 81408 had various patterns.  Some predominantly billed for 81408, some billed each patient for 1x81408 service, some for 2x81408 service.  Some of them billed one unit each of all the Tier 2 codes (81400, 81401, 81402, etc).   

We Learn More About 81479

Turning to unlisted code 81479, spending was $148M.  Here, rather than all the spending being in Novitas and FCSO MACs, as for 81408, it's an opposite pattern.  Virtually all the spending on code 81479 is in MolDx states (except for $7M from Novitas to Interpace in Pennsylvania).  Click to enlarge. 

Complex forces drive the use of 81479.  In some cases, CPT codes aren't available.  In other cases, unusual CMS "NCCI" or MAC articles require use of 81479 in lieu of stack codes, so 81479 can be cost-saving for CMS.   Thus, use of 81479 can represent enhanced compliance by labs in conformity with these CMS rules against stack coding.   This explains 81479 billing by Invitae and Ambry, in California.  But that also leads us to ask why this compliance with CMS policy occurs only in MolDx states and never in the other half of states.

On the other hand,  on the downside, labs billing under 81479 are shielded or at least outside of from PAMA pricing laws and regulations, and the public has no visibility into what Medicare was paying for.  In some cases, I've found via FOIA that MolDx prices assigned under 81479 represented administrative errors in the direction of overpayments to certain labs.'s complex.   

Top 20 Recipients of MoPath Payments by Line Item

The 2,700 line spreadsheet for MoPath payments totaled $1.1B, but 55% of payments ($635M) fell in the top 20 lines, as shown below (click to enlarge).  Note that already by 2018, 3 of the top 20 labs were there for 81408 billing (in 2019, 81408 became the highest paid code of any code).  Another curiousity- the #6 lab in 2018, CardioDx, was shut down early in 2019 when Medicare rescinded LCD coverage (here).   And I've heard MolDx say in 2016, 2017, 2018, and 2019, that they never-ever for-sure-never pay 81455, but they paid $20M on this code in 2018 (line 10), comprising almost all of nationwide payments in 2018 for 81455.

Myriad Genetics Billing for Part B, CY2018

I looked up Myriad and Assurex billing for Part B, CY2018.  CMS dollars allowed were $90M, of which $38M for Genesight and $28M for BRCA and $16M for Myriad Prolaris (81541).  That's about 92% of payments; most of the rest were Lynch syndrome related genes.   Click to enlarge.  Cloud file here.


I corresponded with CMS staff on the delayed release of 2018 billing data in 9/2020, here.



Molecular microbiology codes generally run 87471-87999, but excluding antigen codes 87802-87899.  So defined, molecular microbiology codes tally $290M in this database for CY2018.  I've put them in a separate Excel file in the cloud here.  I've put the top 25 line items under Molec Micro in the next table (click to enlarge).  Roughly, the top 25 lines are the top 25% of revenue for Molec Micro.  The other 10,400 lines are the remaining 75%.  Of the top 20 lines, 16 are in MolDx states.