Medicare Compliance & Reimbursement

HCPCS code may have been a factor in the increase.

With COVID hitting the U.S. hard over the last few years, it shouldn’t come as a surprise that the feds saw the biggest increase of Medicare Part B lab spending since they started tracking data in 2014.

Context: On Dec. 19, 2022, the HHS Office of Inspector General (OIG) released the report, “Medicare Part B Spending on Lab Tests Increased in 2021, Driven By Higher Volume of COVID-19 Tests, Genetic Tests, and Chemistry Tests.” From 2020 to 2021, Part B lab test spending skyrocketed from $8.0 billion to $9.3 billion, a whopping 17-percent increase, according to the report.

COVID-19: A big factor in the increase was due to COVID-19, with Medicare Part B spending on COVID testing increasing by $440 million from $1.5 billion in 2020 to $2.0 billion in 2021. Plus, “the volume of COVID-19 tests that Medicare Part B paid for also increased in 2021, from 18.8 million tests in 2020 to 25.8 million tests in 2021, a 37-percent increase,” OIG says.

The agency reasons that the Centers for Medicare & Medicaid Services’ (CMS) addition of the HCPCS code U0005 (Infectious agent detection by nucleic acid (dna or rna); severe acute respiratory syndrome coronavirus 2 (sars-cov-2) (coronavirus disease [covid-19]), amplified probe technique, cdc or non-cdc, making use of high throughput technologies, completed within 2 calendar days from date of specimen collection (list separately in addition to either HCPCS code u0003 or u0004) as described by cms-2020-01-r2) “incentivized labs” to speed up their “turnaround time,” the report notes.

Resource: Review the OIG’s findings in the report at https://oig.hhs.gov/oei/reports/OEI-09-22-00400.pdf.