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:

CodeDescriptionServices Billed in 2016Total Medicare Payments in 20162017 Average Commercial Payment2018 Proposed PaymentProjected Year-to-Year Change
84443Assay thyroid stim hormone21,328,890$478,201,900.40$23.05$20.75-10%
80053Comprehen metabolic panel41,058,385$464,050,570.56$14.49$13.04-10%
85025Complete cbc w/auto diff wbc41,063,717$425,439,439.40$10.66$9.59-10%
80061Lipid panel28,716,199$407,636,228.63$0$11.23
83036Glycosylated hemoglobin test19,141,107$248,747,306.97$13.32$11.99-10%
84153Assay of psa total4,182,938$102,655,551.38$25.23$22.71-10%
84439Assay of free thyroxine7,001,009$84,030,813.18$12.37$11.13-10%
87086Urine culture/colony count7,466,946$81,233,769.73$11.07$9.96-10%
G0481Drug test def 8-14 classes615,161$72,905,808.62$160.99$144.89-10%
G0480Drug test def 1-7 classes922,783$68,205,583.28$117.65$105.89-10%
81528Oncology colorectal scr122,759$61,218,169.80$512.43$508.87-0.7%
87186Microbe susceptible mic3,893,666$49,897,154.33$11.86$10.67-10%

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

Private Payor Rate-Based Payment System

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.

Urgent Care Billing

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.