The Novitas MAC seems to go through one payment disaster after another, with notoriously high and bizarre-looking payments for 81408 (rare gene, full sequence) and adjacent codes in 2019-2021. The OIG's report cited a "billion dollars" in misspending. Now, in 2023, 2024, the Novitas cash seems to be directed to some otherwise rare gene panels (e.g. for mitochondrial disorders, or for inherited diseases of childhood like cystic fibrosis), and also for code 87798, a microbiology code that is uncontrolled at Novitas. (See also blog.)
Rare Gene Panels (81419, 81430, 81433, etc); 87798
The typical labs billing for these in the US are in Texas or Florida, and they recently obtained NPI numbers as LLCs. The same codes (81408; the rare-gene panels; 87798) are very rarely billed to Medicare by labs like LabCorp, GeneDx, Ambry, Quest, etc.
In each case, billing in Texas and Florida (but not elsewere) exploded such as multiples of 100X over a couple years.
Novitas and PLA Codes - Striking Lack of Controls Compared to MolDx
I looked at 2023 billing to Medicare Part B for all "U" codes - the PLA codes. Total billing was $519M. The distribution was 64% MolDx, 14% Novitas, and 22% NGS MAC.
However, had NGS MAC not been paying for FMI codes which are under an NCD (0037U, 0239U), NGS MAC PLA payments would drop to just $36M or 7% of national.
In each case, the PLA codes were highly concentrated, with 90% to 97% of PLA payments to the top 10 providers in each MAC system. (And, as shown below, most PLA payments went to the top 3-4 codes).
- We noticed something strange when we looked up each PLA code in the Medicare Coverage Database.
- All of the top 10 PLA codes at MolDx fall under NCDs or LCDs.
- In the Novitas MAC, I could identify only 2 of 10 PLA codes that fell under an LCD or NCD, using the same Medicare Coverage Database.
In both Novitas and NGS MAC, many of the payments (not under LCDs) were for 0240U, 0241U, microbiology codes. Although MolDx had 64% of all PLA payments, none of the top 10 at MolDx were microbiology codes.
Caveats
- This is first-pass work; I haven't double checked everything or had anyone replicate it.
- We compare 2023 payments to current 2025 policies.
- I entered CPT codes one by one in the Medicare Coverage Database and took the result.
Click to enlarge. MAC index = 1, MolDx, 2, NOV/FCSO, 3, NGS MAC.
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The CMS cloud database is here. It has all 2023 Part B claims. You can filter for codes ending in "U" = PLA codes.