Molecular Test Reimbursement in the U.S. Explained
The key to understanding the reimbursement process for molecular tests begins with a basic knowledge of Medicare billing, coding, and pricing processes.
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Resources about reimbursement for laboratories
As molecular tests become increasingly important for personalized medicine, so does reimbursement strategy for testing.
Navigating the reimbursement landscape
The most effective way to navigate the reimbursement landscape is to know the basics of Medicare billing, coding, and pricing.
- Medicare reimbursement for molecular tests is administered through the Centers for Medicare and Medicaid Services (CMS).
- The CMS works with regional Medicare administrative contractors (MACs) that serve as primary contacts for the Medicare Fee for Service Program and individual health care providers.
- A MAC is a private health insurer that processes Medicare Part A and B claims, and it bases reimbursement for medical tests on Current Procedural Terminology (CPT™) codes.
- CPT codes are defined by the American Medical Association (AMA) and specify the types of services health care providers perform, including molecular diagnostic tests.
- Molecular diagnostic tests must have designated CPT codes before clinical laboratories can bill and receive payment for performing the tests.
Since reimbursement for molecular diagnostic tests is directly linked to their CPT codes, it is important for laboratories to understand the CPT coding process. A laboratory may also apply for a proprietary laboratory analysis (PLA) code if it wants its test to be categorized with a higher degree of specificity.
For more information about the organizations and terms above, please see the Additional Resources section.
NEW Exploring MolDx and Payer Guidelines for Molecular Testing ›
Learn about the process that labs under MolDx jurisdiction should follow to receive unique DEX code z-identifier that will help obtain the reimbursement for laboratory developed tests or “expanded” panels that test for more than five target.
The Five Ws of Reimbursement and Regulation for Diagnostics
Learn about the use of CPT codes, the role of MACs, and various reimbursement strategies for laboratories that develop molecular tests.
Watch webinar › | 60 minute watch
The Molecular Diagnostic Services (MolDX) Program was instituted by Palmetto GBA in 2011 to establish reimbursement policies for molecular diagnostic tests. Palmetto GBA is one of the largest MACs, and it has provided uniform policies for four MACs across 28 states. As such, the MolDX Program must adhere to Medicare coding and billing guidelines.
More information about the MolDX Program and its coding and billing policies can be found at palmexttogba.com. Other MACs participating in the MolDx program are Noridian, WPS, and CGS.
The online DEX™ Diagnostics Exchange Registry assigns unique alphanumeric DEX Z-codes to molecular diagnostic tests. To determine coverage for a new LDT designed for molecular testing, a laboratory can request a DEX Z-code through Palmetto GBA. A technical assessment may be necessary for any LDT that involves next-generation sequencing, novel technology, or that has unproven clinical utility. Before submission of a technical assessment, a test must be registered online and assigned a DEX Z-code.
The American Medical Association (AMA) provides resources like the press center to help laboratories stay current with developments in the medical and health care industries. Commercial and private payors can create their own coverage policies, and they update them regularly. For more information, please visit individual web sites.
Link | Description | What you might find useful |
|---|---|---|
The CMS fee schedule for health coverage through Medicare, Medicaid, the Children’s Health Insurance Program, and the Health Insurance Marketplace | CPT codes laboratories use for reimbursement and the amounts laboratories are paid | |
An online database of billing codes for diagnoses and procedures that are reimbursed by Medicare and private insurers | ICD-10-CM codes, CPT codes, HCPCS codes, ICD-10-PCS codes | |
Alphanumeric CPT codes with descriptors for laboratories and manufacturers who want to define their tests more specifically | CPT PLA codes, CPT PLA code applications, the latest news about CPT PLA codes | |
Certifies clinical laboratories that meet CLIA quality requirements Note: All clinical laboratories must be CLIA-certified to receive Medicare or Medicaid payments, but the CLIA Program has no billing or payment responsibilities. | Information about the CLIA certification process, paying CLIA fees online | |
Provides information for medical professionals to help them navigate the complex Medicare reimbursement process (continuously updated with the most current reimbursement information) | Laboratory publications and guides, webinars, compliance briefings, paid services | |
College of American Pathologists (CAP) Laboratory Accreditation Program | Provides information to hospitals about laboratory medicine, technology, and the regulatory landscape | CAP accreditation information, fee estimates, applications for accreditation, list of CAP-certified laboratories |
Developed by a panel of experts from the Infectious Disease Society of America (IDSA) who systematically review available evidence and make recommendations to help practitioners and patients make appropriate healthcare decisions | Current best practice guidelines for the prevention, diagnosis, and management of infectious diseases; updated guidelines for diagnostic molecular testing for infectious agents, including SARS-CoV-2 |
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