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Hundreds of lab codes are expected to see reduced payments under a planned Medicare fee schedule change that will take effect January 1, 2018.

The changes are a provision of the Centers for Medicare and Medicaid Services’ (CMS) Protecting Access to Medicare Act (PAMA) of 2014, which requires labs performing clinical diagnostic lab tests to report the amounts paid by private insurers for lab tests. This means that Medicare will use private insurer rates to calculate Medicare payment rates for lab tests paid under the Clinical Laboratory Fee Schedule (CLFS) beginning January 1, 2018.

According to “Part B News,” the rate changes are a result of Congress’ perception that private payors were paying less than Medicare for comparable lab tests. The final rule for these rate changes was actually released back in June of 2016, but they weren’t slated to go into effect until next month due to public feedback requesting more time develop the information systems necessary to implement the rate changes.

Preliminary payment rates published by CMS in September already trend toward cuts, with 879 of the 1,360 codes for which CMS published expected rates on track for a 10 percent pay cut and another 115 codes up for a price reduction of up to 9 percent. Of the 25 most-reported lab codes included in CMS’ report, nearly half are codes that are used in a typical urgent care practice:

Code Description Services Billed in 2016 Total Medicare Payments in 2016 2017 Average Commercial Payment 2018 Proposed Payment Projected Year-to-Year Change
84443 Assay thyroid stim hormone 21,328,890 $478,201,900.40 $23.05 $20.75 -10%
80053 Comprehen metabolic panel 41,058,385 $464,050,570.56 $14.49 $13.04 -10%
85025 Complete cbc w/auto diff wbc 41,063,717 $425,439,439.40 $10.66 $9.59 -10%
80061 Lipid panel 28,716,199 $407,636,228.63 $0 $11.23
83036 Glycosylated hemoglobin test 19,141,107 $248,747,306.97 $13.32 $11.99 -10%
84153 Assay of psa total 4,182,938 $102,655,551.38 $25.23 $22.71 -10%
84439 Assay of free thyroxine 7,001,009 $84,030,813.18 $12.37 $11.13 -10%
87086 Urine culture/colony count 7,466,946 $81,233,769.73 $11.07 $9.96 -10%
G0481 Drug test def 8-14 classes 615,161 $72,905,808.62 $160.99 $144.89 -10%
G0480 Drug test def 1-7 classes 922,783 $68,205,583.28 $117.65 $105.89 -10%
81528 Oncology colorectal scr 122,759 $61,218,169.80 $512.43 $508.87 -0.7%
87186 Microbe susceptible mic 3,893,666 $49,897,154.33 $11.86 $10.67 -10%

Source: CMS Summary of Data Reporting for the Medicare Clinical Laboratory Fee Schedule (CLFS)

If you’re not sure how these changes to the clinical lab fee schedule will impact your urgent care center, make sure you work with an urgent care billing company that has expert knowledge in Medicare reimbursement. Getting ahead of the changes will ensure your center is set up for success as you head into the new year.

PV Billing’s urgent care billing specialists are trained to code, process, monitor and collect urgent care claims so they can provide you with end-to-end revenue cycle management.

This resource was first published prior to the 2019 merger between DocuTAP and Practice Velocity. The content reflects our legacy brands.

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