The American Medical Association (AMA) and the consulting and revenue management firm McKesson have announced a licensing agreement that will allow the AMA to create a new reference product mapping McKesson’s Z-Codes, identifiers for specific molecular diagnostic tests, to the AMA’s Current Procedural Terminology (CPT) code set. The product, which is expected to become commercially available in 2014, is intended to improve identification and tracking of molecular diagnostic tests. While the real-life implications of this agreement for the laboratory and diagnostics industries are not yet fully understood, experts don’t believe the product is likely to impact reimbursement levels or affect the current process of assigning pricing to existing molecular pathology CPT codes. “We believe this product will bring clarity and take some of the confusion out of the market [surrounding molecular diagnostic tests]. This is about specificity of use and we believe this is a good tool to improve the identification and tracking of tests,” Robert Musacchio, Ph.D., AMA’s senior vice president for business products and services, tells DTTR. “We believe this will improve communication among physicians, laboratories, and payers.” Musacchio says that improved description and quantification of molecular diagnostic tests has the potential to better assess the value of […]
The American Medical Association (AMA) and the consulting and revenue management firm McKesson have announced a licensing agreement that will allow the AMA to create a new reference product mapping McKesson’s Z-Codes, identifiers for specific molecular diagnostic tests, to the AMA’s Current Procedural Terminology (CPT) code set. The product, which is expected to become commercially available in 2014, is intended to improve identification and tracking of molecular diagnostic tests.
While the real-life implications of this agreement for the laboratory and diagnostics industries are not yet fully understood, experts don’t believe the product is likely to impact reimbursement levels or affect the current process of assigning pricing to existing molecular pathology CPT codes.
“We believe this product will bring clarity and take some of the confusion out of the market [surrounding molecular diagnostic tests]. This is about specificity of use and we believe this is a good tool to improve the identification and tracking of tests,” Robert Musacchio, Ph.D., AMA’s senior vice president for business products and services, tells DTTR. “We believe this will improve communication among physicians, laboratories, and payers.”
Musacchio says that improved description and quantification of molecular diagnostic tests has the potential to better assess the value of a test and can likely aid in more efficiently establishing effective pricing and coverage policies. In initial discussions with the AMA, he says, private payers have expressed interest in the product.
While financial terms of the AMA-McKesson arrangement were not disclosed, the organizations say that the new reference product mapping Z-Codes to CPT codes will be available for licensing from AMA in early 2014. Not all of McKesson’s 2,000-plus Z-Codes are expected to immediately map to CPT codes, and some of the current CPT codes will be associated with multiple Z-Codes.
Despite the AMA’s previous opposition to Z-Codes (in 2011 the AMA charged that use of Z-Codes in Palmetto’s MolDx molecular diagnostic payment program violated the Health Insurance Portability and Accountability Act), this marks the second recent step the AMA has taken to improve transparency in the rapidly growing molecular diagnostics market. In late January the AMA agreed to integrate its CPT codes into the National Institutes of Health’s Genetic Test Registry.
