3 Things You Need to Know about the Lab Fee Schedule

The Centers for Medicare and Medicaid Services (CMS) issued the final 2017 Clinical Laboratory Fee Schedule (CLFS) on Nov. 21. Here is a look at the three key changes you need to know about going into 2017:

1. Seven Molecular Assays Stave Off Big Cuts

After the industry asked CMS to reconsider proposed gapfill prices for 16 CPT codes for molecular tests, CMS apparently took heed, dropping the rate cuts and either restoring or increasing the regional prices for seven of the 16 tests listed. Companies benefiting from the change of course included:

• CareDx, which instead of a 77 percent cut got a 47 percent increase on its AlloMap test to identify heart transplant recipients at low risk of rejection (CPT 81595);
• Biodesix, which got a 57 percent hike on its Veristrat lung cancer aggressiveness test (81538);
• Genomic Health, which got a 51 percent hike on its Oncotype DX colon cancer recurrence test (81525);
• BioTheranostics, which got a 23 percent hike on its metastatic tumor origins diagnostic test (81540);
• Invitae, which avoided a 33 percent cut on its hereditary breast cancer panel (81432);
• CardioDx, which instead of a 28 percent cut got a modest 1.4% increase on its coronary artery disease risk test Corus CAD (81493); and
• Veracyte, which instead of a 22 percent cut got a 12 percent increase on its thyroid nodule assessment assay Affirma (81545).

2. New Pricing Formula for Differential Drug Testing G Codes

The other significant development in the final CLFS affects pricing of the four definitive drug tests capable of identifying individual drugs and distinguishing between structural isomers, for which CMS issued HCPCS G codes in 2016—G0480, G0481, G0482 and G0483. To pay for these tests, CMS used a crosswalking formula under which: i. the first two tests performed were paid at the full price of the crosswalk CPT code 82542; and ii. remaining tests within that code were paid at 25% of the crosswalk price.

Industry asked CMS to modify the formula for 2017 claiming that it understates the true costs of performing accurate tests. CMS opted to allow the four tests to be priced at the full crosswalk price, which should adequately recognize the resources required to perform these procedures, CMS explains.

New Formula for Crosswalking Price of G Code Differential Drug Tests

* Note: 82542 = full crosswalk price for CPT code 82542

3. CMS Crosswalks 14 Codes

The final significant change in the 2017 CLFS is the crosswalking of 14 existing CPT codes to eliminate duplication. Those codes are: 80305, 80306, 80307, 81327, 81413, 81414, 81420, 81422, 81439, 81539, 84410, 87483, G0475, and G0476.