On April 30, 2020, the Centers for Medicare & Medicaid Services (CMS) issued an interim final rule with comment period (the “Interim Rule”) which – among other things – makes changes to Medicare requirements for ordering COVID-19 laboratory tests, Medicare reimbursement for specimen collection and Medicaid reimbursement for laboratory services.

Modified Medicare Requirements for Ordering COVID-19 Diagnostic Laboratory Tests

Previously, under 42 CFR § 410.32(a) certain diagnostic tests – including a COVID-19 test – were reimbursable under the Clinical Laboratory Fee Schedule only when ordered by a physician or non-physician practitioner (NPP) treating the patient for a specific medical problem, when they use the results of the tests to manage that medical problem. 42 CFR 410.32(b) required a specified minimum level of physician supervision for a diagnostic test. The new policy modifies these regulations for the duration of the public health emergency (PHE) to allow COVID-19 tests to be covered when ordered by any healthcare professional authorized to do so under state law (e.g., NPs, CNSs, PAs, and CNMs). Moreover, because COVID-19 symptoms are similar to those of certain other respiratory illnesses, CMS is also removing the same ordering requirements for influenza and respiratory syncytial virus testing – as well as for other illnesses that will be published in a list by CMS – as long as the testing is done “in conjunction with a COVID-19 diagnostic laboratory test as medically necessary in the course of establishing or ruling out a COVID-19 diagnosis or of identifying patients with an adaptive immune response to SARS-CoV-2 indicating recent or prior infection.” The modification will also remove certain corresponding documentation and recordkeeping requirements at § 410.32(d)(2) and (3) associated with orders for COVID-19 tests during the PHE.

The Interim Rule also contains a requirement for clinical laboratories to report test results directly to patients when tests are furnished without a physician’s or NPP’s order. The Interim Rule stresses the importance of prompt reporting to patients and public health agencies to aid in containment and notes CMS expects such, preferably within 24 hours.

Flexibility for Medicaid Reimbursed Laboratory Services

The Interim Rule makes modifications to Medicaid limitations on how and where diagnostic testing must occur for reimbursement allowing collection in non-office settings. CMS notes that “Section 6004(a) of the Families First Coronavirus Response Act added a new mandatory benefit in the Medicaid statute at section 1905(a)(3)(B)” that mandates coverage for in vitro diagnostic products that detect SARS-CoV-2 and administration of those tests. In order to provide this benefit in light of the growing utilization of non-office settings – such as parking lots or other temporary outdoor locations – for testing, the Interim Rule makes changes to the current regulations that govern lab test payments. Previously, Medicaid-covered laboratory and X-ray services had to be ordered and provided by or under the direction of a physician or other licensed practitioner or ordered by a physician but provided by a referral laboratory. Moreover, Medicaid previously only covered laboratory and X-ray services provided in an office or similar facility other than a Hospital Outpatient Department (HOPD) or clinic. Accordingly, there was some difficulty in providing the mandatory benefit for testing preformed in alternate locations. Now, under the Interim Rule, Medicaid will cover tests administered in non-office settings, and cover for laboratory processing of self-collected COVID-19 tests that are FDA-authorized for self-collection. Moreover, the Rule permits states to cover laboratory processing of self-collected test systems that the FDA has authorized for home use, without the order of a treating physician or other licensed NPP.

Interestingly, the changes will be effective for the COVID-19 PHE and any period of surveillance after the PHE. Also, the Interim Rule makes an addition to the Medicaid testing regulations that will allow these changes to also be effective in to future PHEs resulting from outbreaks of communicable disease to quickly permit limited contact testing. The changes are effective retroactively to March 1, 2020.

Medicare Payment for COVID-19 Specimen Collection to Physicians, Nonphysician Practitioners and Hospitals

The Interim Rule creates a reimbursement option for physicians, NPPs and HOPDs for specimen collections. It also waives Medicare beneficiary cost sharing for this service. In a previous rule, CMS created CPT codes G2023 and G2024 for specimen collection for COVID-19 laboratory tests. “Independent laboratories must use one of these HCPCS codes when billing Medicare for the nominal specimen collection fee for COVID-19 testing.” To further support testing the Interim Rule allows physicians and NPPs to use CPT code 99211 to bill for services furnished incident to their professional services, for both new and established patients, when clinical staff assess symptoms and collect specimens for purposes of COVID-19 testing. CMS is also waiving all cost sharing on this code when all requirements under section 6002(a) of the Families First Coronavirus Response Act are met. Moreover, CMS created a new OPPS code, CPT code C9803, for HOPDs to bill for a clinic visit dedicated to specimen collection. CMS adopted a policy to conditionally package payment for this code and make separate payment for HCPCS code C9803 under the OPPS when no other primary service is furnished in the same encounter. Cost sharing on the OPPS code is also waived when all requirements under section 6002(a) of the Families First Coronavirus Response Act are met.

This post was co-authored by Michael Lisitano, legal intern at Robinson+Cole. Michael is not yet admitted to practice law.