Thursday, October 12, 2023

2022: The Year CMS Finally Stopped Hemorrhaging 81408 Fraud

As documented in trade journal articles, this blog (since September 2020, when I saw 2019 data), and a 2023 OIG report, Medicare lost a billion dollars in daffy claims for CPT code 81408 (rare long sequence genes for orphan diseases, including pediatric).   Add at least half that number again, for adjacent codes used in ridiculous ways (81406, 81407).  

Did I say ridiculous?  Most labs billing 81408 billed every possible Tier 2 (rare) code to the maximum, quarter after quarter.  Imagine a 90 year old nursing home patient, and a claim for 14 rare genes full sequence.   Now imagine thousands of such claims pouring in from a lab that just popped up and nobody's ever heard of, every 90 year old needing the same 14 rare genes.  As my college physical chemistry professor said, it's about as unlikely as all the air molecules in this auditorium rushing to the same corner at once. 

The OIG report last summer said, that CMS MACs assured it that the problem had been solved by 2022.  I was, well, uncertain, since the problem was well-known since public DOJ reports in mid 2019.

But in fact, 81408 payments did plummet from a colossal $283M in 2021, to only $372K in 2022
Finally.   The cutoff date should damn well have been around October 2019, not December 2021, saving the $480M lost in 2020 and 2021, but at least the cut off date finally arrived.  That's still more than the natural rate of $9000/year (in 2017), but a lot better than the $900M spent overall.  Throughout the saga, payments were almost exclusively through the Novitas and FCSO MACs.

81408, Part B, per year

June 2023

Where's it come from?

On October 12, 2023, CMS released Part B payment files for CY2022. There are two sets, one is national Part B payments by CPT code category (like "pathology.")  The other is files on a state by state basis.