Friday, November 4, 2022

ADLT Codes 2021: 10% of MoPath Spending, and Mostly "FDA ADLTs"

On October 28, 2022, CMS released data on Part B payments for all CPT codes in CY2021.  

I did an extensive analysis here, including that a third of payments appear to be through "very highly suspicious" codes to labs in a handful of southern states.  

For example, labs that billed 1 or more of EACH ONE of the rare Tier 2 code levels for every elderly Medicare patient they saw.   (This is statistically like every one of the 500 patients in a row each winning the lottery or each having a royal flush).

ADLT Codes   

Since 2018, there's been a rarely used pathway for price setting, called "Advanced Diagnostic Laboratory Test" or ADLT.  These tests are always sole source tests (like Oncotype or Foundation Medicine) and they may be (A) either FDA-approved or (B) a clinically unique MAAA test.   

CMS has approved 12 tests as ADLTs, of which, 4 arrived via the FDA pathway.

Here's a chart segregating the 12 ADLT-priced codes from the other hundreds of molecular codes.  Click to enlarge.


The dollar volume of all ADLTs in CY2021 in Part B was $208M.   

How does this compare?  All MoPath payments, including microbio and COVID, were about $4B, so ADLT payments would be about 5%.   

However, if you subtract about $1B in COVID testing, and also subtractnearly $1B in highly highly dubious payments, that leaves about $2B in legitimate mopath payments.  At $208M, ADLTs would now be about 10% of the legit 2021 payments.


As shown in the table above, ADLT prices range from $1755 to $7193.   

57% of ADLT payments go through two codes (Castle 81529 and Foundation 0037U), while 90% of ADLT payments went through four codes (adding 0239U, 0242U).   Or, 8 of 12 ADLT codes had only minimal payments in 2021.

The "FDA ADLTs" are Thriving

FDA codes currently dominate payments.  

While FDA codes were only 4 of the 12 codes, FDA codes garnered $148M or 71% of all ADLT type payments.