Here is the market price data for paint management and toxicology labs from XIFIN Inc. Lâle White, Founder and CEO of XIFIN, discusses the data with THE DARK REPORT.
EDITOR: Before we discuss XIFIN’s analysis of what PAMA market price reporting will look like for labs involved in pain management testing and toxicology, I think it is appropriate to recognize that there has been substantial fraud and abuse in this sector. That can affect the policies private payers use to adjudicate claims for this category of lab tests.
WHITE: To that point about the policies of private payers regarding pain management and toxicology lab test claims, readers should understand two things about this analysis. First, the data is from 2016. Thus, it represents payments from payers who have implemented policies to address illegal or unethical billing practices by some labs offering these tests and who have adopted the G codes. In that regard, the data represent current reimbursement levels from private payers.
EDITOR: And your second point?
WHITE: The second point is that the data are from XIFIN lab clients and these labs have demonstrated to us that they have appropriate compliance policies and programs in place.
EDITOR: Keeping those two points in mind, how should this data be interpreted?
WHITE: It is necessary to understand a few things about the G codes. Early on, the Medicare program initiated severe cuts to the G codes. At the same time, across the board, private health insurers have not fully accepted use of G codes for these types of lab test.
EDITOR: That is interesting. How are things changing? Are private payers more willing to accept the G codes?
WHITE: We’ve seen a slow, but steady growth in the number of private payers that have adopted the G codes. It should be noted, however, that the volume of G codes in pain management that private payers use is not large.
EDITOR: Is there a pricing trend for pain management and toxicology testing that you see with private payers?
WHITE: This data set reflects the G codes where they’ve been adopted by private health insurers and, while it doesn’t represent a big volume, payment is significantly higher than Medicare rates. Looking at both the G codes and some of the 8xxxx codes that pain management/toxicology labs use, this data shows a 50.4% higher payment rate than what is paid by Medicare.
EDITOR: What is changing with the 8xxxx codes that are used in pain management and toxicology testing?
WHITE: It is interesting that the majority of this 2016 data set were paid in the old 8xxxx codes and these are not going to be part of the PAMA lab test market price reporting. By the way, these codes were also paid at high rates by private payers compared to the Medicare program.
EDITOR: Have CMS officials given an indication as to how they might change current guidelines and reimbursement levels involving pain management and toxicology test codes?
WHITE: During recent meetings conducted by CMS, Medicare officials have made statements that show some recognition that the federal agency had gone too far in the cuts for pain management testing and the G codes specifically. There are indications that CMS may be preparing to do an upward adjustment in 2017.
- This private payer price data was gathered from the lab clients of 1, 2016 and June 30, 2016.
- Data comes from multiple pain management/toxicology labs and tens of millions of lab test claims.
- Listed above are the top 20 pain management/toxicology tests for which the Medicare program spent the most money during 2015.
- The table shows how the “private payer weighted average rate”compares to the Medicare National Limit for each test.
- The variance, in dollars, and the percentage increase or decrease over the Medicare National Limit is shown in the far right column.
- XIFIN’s calculations, based on real price data to be reported by this pool of its lab clients, indicate that CMS would get price data for this group of pain management/toxicology tests that would show private payers pay labs a cumulative 50.4% more than the Medicare National Limit. Again, this data set does not include pricing for the same tests preformed by Independent Clinical Labs and Hospital Labs, and will alter the weighted median average based on the mix of data submitted across various labs.