Testing Frequency: Industry Standards, Waste, and Provider Education

Testing Frequency: Industry Standards, Waste, and Provider Education

Testing Scrutiny

Over the last decade CMS, the Department of Health and Human Services (HHS), and the Office of the Inspector General (OIG) have continued their scrutiny of laboratory services relating to drug testing.  Although the two largest U.S. commercial labs make up almost half of independent laboratory payments, it is the smaller reference and physician-owned labs they spend their time monitoring.  Technology today allows insurance companies to keep a record of ordering and testing trends. 

The biggest complaint and the main reason for insurance denials for our toxicology testing services is the frequency of testing and the number of drugs being tested per patient.  Although insurances have developed their own rules regarding how frequently they will pay for testing, almost all insurances have followed the CMS guidelines regarding reimbursement using the four Tier system when drug testing. 

Drug Classes

Classes of drugs have been established by the AMA per CPT codes and the number of classes is what makes up the Tiers when doing definitive testing. 

  • Tier 1 includes 1-7 classes of drugs and is coded G0480
  • Tier 2 is 8-14 classes and is coded G0481
  • Tier 3 includes 15-21 classes and is coded G0483
  • Tier 4 is considered 22 classes of drugs and above and is coded G0484. 

Every individual drug has a CPT code and metabolites have the same CPT code as their analyte.  Although many drugs are counted as a class, there are several drugs that are combined to make a class.  One example is codeine, morphine, hydrocodone, norhydrocodone, and hydromorphone are considered one class of drugs whereas fentanyl and norfentanyl are considered one class.  

The Prevention of Fraud

In 2012 an organization called Healthcare Fraud Prevention Partnership was formed, consisting of state agencies, the federal government, law enforcement, private health insurance plans, employer organizations, and healthcare anti-fraud associations.  Monitoring drug ordering and testing trends are some of the things they do.  Interestingly they hold both the physician who orders the drug tests and the lab running the tests accountable for testing patterns.  One of their stated purposes is to increase detection of fraud, abuse, and waste across the public and private healthcare spectrum. 

Working Within the Boundaries

Over the last several years they have been targeting the drug testing industry as well as ordering providers.  Even though we do not have any fraudulent relationship with facilities or providers, we have been receiving calls regarding some of the ordering trends of some facilities.  As a lab that prides itself on conducting accurate and appropriate lab testing, ILDP has committed to assisting providers, substance abuse facilities, and addiction clinics with ordering drug testing that both satisfies their needs and stays within the current boundaries being created by the government and insurances through provider education.  With very little exception…

  • Tier 1 confirmation is paid without a second glance. 
  • With legitimate medical documentation by the provider, an occasional Tier 2 or Tier 3 test will be approved, however clinic documentation will be required. 
  • A Tier 4 test is almost always only allowed on a new patient and again will have to be documented and required by the insurance company.

Provider Education

Over the next several months, ILDP will be hitting the road for our annual road trip.  This year we will make provider education a priority. Especially pertaining to current industry trends for ordering in an effort to help both them and us stay within industry standards regarding drug testing.  As always thank you for your business.

 Lance Benedict

President/CEO Industry Lab Diagnostic Partners