Medicare/Medicaid Compliance

CPT Codes

The American Medical Association (AMA) Current Procedural Terminology (CPT) codes published in the Aspirus Reference Lab (ARL) Online Reference Manual are provided for informational purposes only. The codes reflect our interpretation of CPT coding requirements, based upon AMA guidelines published annually. CPT codes are provided only as guidance to assist you in billing.  ARL strongly recommends that clients confirm CPT codes with their local carrier or intermediary.  CPT coding is the sole responsibility of the billing party.  ARL assumes no responsibility for billing errors due to reliance on the CPT codes listed in the ARL Online Reference Manual.

Panels and Reflex Testing

ARL offers groups of tests based on accepted clinical practice, as well as those that are defined by the AMA CPT.  All individual components of these “panels” may also be ordered individually, unless otherwise indicated.

ARL offers two types of reflex panels: standard reflex test panels and compulsory reflex test panels.

A standard reflex test panel allows the physician the option of ordering either the reflex group or a detailed test.

A compulsory reflex panel automatically generates a request for additional testing if the result(s) of the initial test(s) meets or falls outside certain ranges. In many cases and especially in microbiology and blood bank procedures, the compulsory reflex test panels have been predetermined based on specific medical criteria, are accepted as standard-of-care by the medical community, and may not be available for ordering at the detail level. 

Medicare/Medicaid Coverage of Laboratory Testing

Under federal and state statutes and regulations, ARL bills Medicare and Medical Assistance directly for clinical laboratory services that it performs or refers to an outside laboratory. Physicians may not bill the Medicare or Medical Assistance programs for laboratory tests they do not perform. When ordering laboratory tests that will be billed to Medicare / Medicaid or any other federally funded program, the following requirements apply:

  1. Only tests that are medically necessary for the diagnosis or treatment of the patient should be ordered. Medicare does not pay for screening tests, except for certain specifically approved procedures, and may not pay for tests considered experimental or not approved by the Food and Drug Administration (FDA). The Office of the Inspector General takes the position that a physician who orders medically unnecessary testing may be subject to civil penalties.
  2. If there is reason to believe that Medicare will not pay for a test, the patient must be informed and asked to sign an Advance Beneficiary Notice (ABN) to indicate that he/she is responsible for the cost of the test if Medicare denies payment.
  3. The ordering physician is required to provide ICD-10 diagnosis codes to laboratories to ensure that laboratory claims will be accurate. Please provide an ICD-10 code that most accurately describes the patient’s condition. Do not choose a code merely to claim payment. ICD-10 codes must be provided in a valid format, including the fourth and fifth digit specificity when required and available.
  4. Local Coverage Determinations (LCD) and National Coverage Determinations (NCD) exist for many laboratory tests. The NCDs are found on the CMS website. LCDs are listed on the websites of the carrier or fiscal intermediary. It is the responsibility of the client to verify CPT codes and ICD-10 codes with Medicare carriers and third-party payers.
  5. Whenever possible, tests that are subject to LCDs or NCDs as established by ARL’s fiscal intermediary are printed in red on ARL test requisition forms.
  6. Organ and disease-related panels should be ordered only when all components of the panel are medically necessary.
  7. Medicare National Limitation Amounts for CPT codes are available from the Centers for Medicare and Medical Assistance website or its intermediaries. Medicaid reimbursement will be equal to or less than the amount of Medicare reimbursement.

Medicare/Medicaid Billing Requirements

ARL files claims with the Medicare and Medical Assistance programs for referred tests for patients insured by these programs. If Medicare or Medical Assistance is secondary to other insurance, ARL will file claims with the primary insurer.

To ensure accurate and timely filing of Medicare and Medical Assistance claims, the following information is required. We recognize the extra time and effort it takes to provide this additional information to us and we are grateful for your continued cooperation in helping us obtain the information we need to bill for our services.
A copy of your facility’s patient demographic and complete billing information may be attached to the requisition as a means of providing the following information:

  • Patient’s name, Social Security number, date of birth, sex, and address
  • Date and time specimen was collected (to assure compliance with the 3 Day Rule)
  • Ordering physician’s name
  • Name of responsible party or guarantor, relationship to the patient, address, city, state, daytime phone number, and place of employment / retired
  • Primary insurance if Medicare or Medical Assistance is secondary. Please include company, subscriber, and group numbers and the address and phone number of the insurance company
  • ICD-10 diagnosis code(s)

Advance Beneficiary Notice (also known as Medicare Waiver)

If a test is determined by ARL’s Medicare fiscal intermediary to be medically unnecessary, the laboratory may only bill the patient if an Advance Beneficiary Notice (ABN) has been completed and signed by the patient prior to the time that the specimen is collected.  Clients who have access to the Aspirus information system network are encouraged to use the ABN Compliance Checker to determine medical necessity and generate ABNs. The original ABN is submitted to ARL with the specimen for testing.

Medicare’s medical necessity requirements may not always be consistent with the reasons you believe a test is appropriate for a patient. Nevertheless, when you have reason to believe that Medicare may consider a test medically unnecessary, the patient should be asked to sign a completed ABN after receiving a clear explanation of the reason(s) the ABN is necessary. A new original ABN must be signed each time such conditions exist. An ABN signature may not be requested solely on the basis that a test being ordered is subject to coverage limitations under an LCD or NCD.

The ABN and your explanation ensure that the patient understands that he/she will be responsible to pay for any service marked on the form that Medicare does not cover for one of the following reasons:

The ABN and your explanation ensure that the patient understands that he/she will be responsible to pay for any service marked on the form that Medicare does not cover for one of the following reasons:

  • The test is subject to coverage limitations and the diagnosis for which the test is ordered is not considered to be indicative of medical necessity by Medicare.
  • No diagnosis was provided.
  • The test is ordered more frequently than Medicare considers medically necessary.
  • The test is for research or investigational use only and is not approved by the Food and Drug Administration.

An ABN may only be obtained when the laboratory or physician believes a test may not be covered. ABNs must not be obtained from every Medicare beneficiary (blanket ABN).

An ABN is not required for screening services or services that Medicare does not cover. However, the ABN is highly recommended because the patient must be informed that Medicare does not provide coverage for screening diagnoses or for a particular service.

If Medicare denies reimbursement for a test and a valid ABN has not been obtained, the client will be billed for the test at the client’s fee schedule rate.

All the information on the ABN form must be completed. The test(s) that you believe will be considered by Medicare to be medically unnecessary must be clearly marked. The reason for possible denial of payment must also be indicated. Please write the test name and CPT code as they appear in ARL’s Online Reference Manual. Do not use synonyms or abbreviations.

Please be sure that the patient reads, understands and signs the ABN prior to the specimen being collected. If the patient is unable to sign, the form should be marked with an “X” and the patient’s guardian, guarantor or other responsible party should sign the form.