Emerging trends and complexities of genetic testing reimbursement

Complexities of genetic testing reimbursement
Genetic testing has become an increasingly important and effective tool in identifying and treating disease. Genetic testing can confirm or rule out suspected genetic conditions as well as determine whether a person can pass those conditions onto their offspring. This can help clinicians focus on the correct treatment as quickly as possible, which may lead to better health outcomes for patients. Over the last several years, innovation around genetic testing has helped drive tremendous growth in genetic testing.

The growth in genetic testing is impressive — approximately 14 new tests enter the market each day. At this moment, there are approximately 75,000 genetic tests, creating dizzying complexity for patients, providers and health plans. Exacerbating the problem is the fact that there are less than 250 Current Procedural Terminology (CPT®) billing codes to describe all of these tests.

As testing options increase in complexity, there is a mismatch with the limited number of codes and the need for greater transparency into what tests are being ordered. The limited number of codes has led to overbilling of non-specific or unlisted CPT® codes. In turn, this has led to an inability to validate specific tests by these codes alone.

Because health plans are unable to validate which genetic test was performed, it is difficult to determine accurate reimbursement. One option is to review medical records and other lab documentation. But those reviews create administrative burden for health plans and providers who need to submit more supporting documentation. In addition, each test can range in cost from $250 to $6,000 each, and providers still face compound reimbursement issues.

Health plans often “blind pay” for genetic tests at the CPT® level, which may result in overpayment and increased costs for Medicare, Medicaid and health plans. Multiple parties are creating their own unique genetic test identification requirements and approval processes. So a solution is needed to remove the additional time and cost on the providers and labs and put the attention on the patient.  

Single open source unique identifier
The Genetic Testing Registry (GTR), managed by the National Institute of Health (NIH), provides a central location for labs to submit genetic test information voluntarily, including:

  • Test purpose
  • Test methodology
  • Test validity
  • Evidence of test usefulness
  • Lab contacts
  • Lab credentials

Once the lab registers a test, the GTR assigns a unique ID for each lab and test registered. These GTR-IDs help:

  • Identify the unique genetic test when used in conjunction with a CPT® code
  • Enable consistent identification across systems by labs, providers, health plans and policy makers

Creating an environment for accurate reimbursement
By adopting the GTR identifier, the health plan, provider and lab will be synchronized with accurately identifying the test performed. In addition, the health plan, provider and lab will be aligned to understanding the information needed on a claim to ensure accurate claim submission and reimbursement guidelines.

Through a six-month pilot, Optum partnered with Ambry Genetics to test the feasibility and benefits of requiring GTR IDs on all genetic test claims. By using NIH’s GTR database, in addition to the 200-plus genetic tests registered by Ambry, Optum was able to accurately decipher what tests were performed while removing delays previously caused by reviewing records. As a result, Optum was able to identify inappropriately submitted claims based on American Medical Association (AMA) and Centers for Medicare and Medicaid Services (CMS) guidelines resulting in 15% savings in medical costs.

The pilot was driven by the Optum Payment Integrity vision to empower accurate, effortless health care payments for all. It focused on mapping GTR codes and CPT® codes to genetic tests to properly identify tests and probe for appropriate billing behaviors.

Benefits of taking a proactive approach to managing genetic testing spend
Beyond medical cost savings, there are several benefits of taking this type of approach to managing genetic testing spend:  

  1. Create operational efficiencies – GTR helps bring unique identification of genetic testing where growth is exceeding the ability to keep up with traditional coding structures.
  2. Make systems more transparent and predictable – provide labs the ability to differentiate their tests and ensure awareness of their effectiveness.
  3. Eliminate variances in genetic testing claims – adjudicate claims faster by eliminating variances.
  4. Avoid administrative abrasion – analytics do the work of matching the correct code to the exact test so health plans don’t have to review medical records or other lab documentation.
  5. Decrease work to identify tests and policies – make and manage coverage policies more easily and develop a well-informed utilization management program by measuring diagnostics utilization effectively.

Learn more about genomic testing and other emerging trends in payment integrity. Visit optum.com/paymentintegrity or contact us at empower@optum.com.

* CPT® is a registered trademark of the American Medical Association.

About the author

Lisa Jo Abbo

Director, Molecular Pathology, Genomics and Laboratory Medicine, Optum Payment Integrity

Lisa Jo Abbo manages transformational projects to control medical cost savings for Optum clients. She has developed new solutions to solve tough challenges through cultivating relationships. The resulting savings add up to well over $300 million in claims edits, denials and overpayment collections.

Prior to this role, Lisa Jo was director of laboratory and pathology at the University of Chicago Medicine. She built a broad-based diagnostic laboratory platform to offer highly specialized reference testing nationwide. Lisa Jo was awarded the 2016 $100,000 Innovation Grant for her proposal to reduce the proportion of infusion therapy patients sent home without chemotherapy treatments as a result of abnormal laboratory tests to <5%. The solution uses a mobile app to provide on-demand blood draws to infusion therapy patients.

She earned her bachelor’s degree in clinical and laboratory science from Lincoln College, graduating as the salutatorian of her class. She earned a master’s degree in health care administration from Capella University, and a second master’s for jurisprudence in health law from Loyola University School of Law. She has earned certification as a diplomate in laboratory management from the American Society of Clinical Pathology.

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