Section. CPT only copyright 2008 American Medical Association. All rights reserved. 26Independent Laboratory

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1 Section 26Independent Laboratory Enrollment Clinical Laboratory Improvement Amendments (CLIA) CLIA Requirements CLIA Regulations Limits of Waiver and Physician-Performed Microscopy Procedure (PPMP) CLIA Certificates Waiver Certificate PPMP Certificates Reimbursement Texas Health Steps (THSteps) Outpatient Laboratory Services Benefits and Limitations Reference Labs and Lab Handling Fees Repeated Procedures Modifier Modifier Laboratory Paneling Chemistry Tests Urinalysis CBC Organ or Disease Panels Ferritin and Iron Studies Laboratory Services for Clients on Dialysis Transfusion Medicine Claims Information Electronic Filing for Laboratory Providers Claim Filing Resources CPT only copyright 2008 American Medical Association. All rights reserved.

2 Section Enrollment To enroll in Texas Medicaid, the independent (freestanding) laboratory must: Be independent from a physician s office or hospital. Meet the staff, equipment, and testing capability standards for certification by HHSC. Have Medicare certification. Submit a current copy of the medical director s physician license, if the lab has physician involvement. Important: All providers are required to read and comply with Section 1, Provider Enrollment and Responsibilities. In addition to required compliance with all requirements specific to Medicaid, it is a violation of the Medicaid Program rules when a provider fails to provide health-care services or items to Medicaid clients in accordance with accepted medical community standards and standards that govern occupations, as explained in Title 1 Texas Administrative Code (TAC) (a)(6)(A). Accordingly, in addition to being subject to sanctions for failure to comply with the requirements that are specific to Medicaid, providers can also be subject to Medicaid sanctions for failure, at all times, to deliver health-care items and services to Medicaid clients in full accordance with all applicable licensure and certification requirements including, without limitation, those related to documentation and record maintenance. Refer to: Provider Enrollment on page 1-3 for more information about enrollment procedures. Medicaid Managed Care on page 7-5 for more information Clinical Laboratory Improvement Amendments (CLIA) CLIA Requirements To be eligible for reimbursement by Medicare and Medicaid, all providers performing laboratory tests must: Pay a fee to the Centers for Medicare & Medicaid Services (CMS). Contact HHSC at to receive a CLIA registration and/or certification number. Providers can submit CLIA applications to the following address: Health Facility Licensing and Certification Division HHSC 1100 West 49th Street Austin, TX Notify TMHP of the assigned CLIA number at the following address: Texas Medicaid & Healthcare Partnership Provider Enrollment PO Box Austin, TX TMHP monitors claims submitted by clinical laboratories for CLIA numbers. If there is not a CLIA number on file with TMHP, claims for laboratory services will be denied CLIA Regulations CMS implemented CLIA rules and regulations. The CLIA regulations were published in the February 28, 1992, Federal Register and have been amended several times since. The regulations are found at Title 42 Code of Federal Regulations, Part 493. The CLIA rules and regulations are available on the CMS website at CLIA regulations set standards designed to improve quality in all laboratory testing and include specifications for quality control (QC), quality assurance (QA), patient test management, personnel, and proficiency testing. These regulations concern all laboratory testing used to assess human health or to diagnose, prevent, or treat disease. Under CLIA 88, all clinical laboratories (including those located in physicians offices), regardless of location, size, or type of laboratory, must meet standards based on the complexity of the test(s) they perform Limits of Waiver and Physician- Performed Microscopy Procedure (PPMP) CLIA Certificates CLIA certificates may limit the holder to performing only certain tests. Medicaid bills must accurately reflect only services authorized by the CLIA program and no other procedures. Two types of certificates limit holders to only certain test procedures: Waiver and PPMP certificates Waiver Certificate Providers holding waiver CLIA certificates are authorized to perform only the tests in the following table. These tests were granted waiver status under CLIA and were updated beginning September 27, The QW modifier is a CLIA requirement for specific codes based on their complexity and must be included or claims will be denied QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW QW CPT only copyright 2008 American Medical Association. All rights reserved.

3 Independent Laboratory QW QW QW QW QW QW QW QW QW QW QW G PPMP Certificates Holders of PPMP certificates are authorized to perform all the procedures listed for waiver certificates and the following tests: Q0111 Q0112 Q0113 Q Reimbursement The Medicaid rates for independent laboratories are calculated in accordance with 1 TAC and , and the Deficit Reduction Act (DEFRA) of By federal law, Medicaid payments for clinical laboratory services cannot exceed the Medicare payment for that service. As the result of the Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982, independent laboratories are not directly reimbursed by Medicaid when providing tests to clients registered as hospital inpatients. Reimbursement must be obtained from the hospital. These services cannot be billed to the client. Refer to: Reimbursement Methodology on page 2-2 for more information about reimbursement Texas Health Steps (THSteps) Outpatient Laboratory Services The Medicaid service, Early and Periodic Screening, Diagnosis, and Treatment (EPSDT), is known in Texas as Texas Health Steps (THSteps). Refer to: Eligibility for a Medical Checkup on page All required THSteps laboratory work, except for screening related to type 2 diabetes and hyperlipidemia, is to be performed by the Department of State Health Services (DSHS) Laboratory Services Section. DSHS makes laboratory supplies and services available for free to all enrolled THSteps medical providers for THSteps clients. THSteps laboratory services provided by a private laboratory will not be reimbursed. The DSHS Laboratory Services Section is reimbursed at its cost for performing these tests. Except for Pap smears, other required THSteps laboratory work that can be mailed at ambient temperature must be sent to the DSHS Laboratory Services Section using the business reply label provided to the following address: Laboratory Services Section, MC 1947 Department of State Health Services PO Box Austin, TX THSteps laboratory work that requires overnight shipping on cold packs through a courier service must be sent to the DSHS Laboratory Services Section at the following address: Laboratory Services Section, MC 1947 Department of State Health Services 1100 West 49th Street Austin, TX Fax: Toll-free: ext Pap smear specimens must be sent to the following address: Women s Health Laboratories 2303 SE Military Drive, Suite 1 San Antonio, TX Customer Service: or Fax: Claims for tests listed in the following table submitted by a THSteps medical provider or an outside laboratory for the same date of service as a THSteps medical check up will be denied and are subject to retrospective review and recoupment of inappropriate payments. Laboratory Test Texas Health Steps (THSteps) medical providers may choose the laboratory to which they send THSteps laboratory specimens for blood test screening for hyperlipidemia or Type 2 diabetes. Laboratories that bill for these procedure codes on the same date of service as a medical check up visit can be reimbursed separately. Providers that obtain and process these specimens inhouse are not reimbursed separately Benefits and Limitations Texas Medicaid only covers professional and technical services that an independent laboratory is certified by Medicare to perform. 26 CPT only copyright 2008 American Medical Association. All rights reserved. 26 3

4 Section 26 Medicaid pays up to the amount allowed for the total component for the same procedure, same client, same date of service, any provider. Providers that perform the technical service and interpretation must bill for the total component. Providers that perform only the technical service must bill for the technical component. Providers that perform only the interpretation must bill for the interpretation component. Claims filed in excess of the amount allowed for the total component for the same procedure, same dates of service, same client, any provider, are denied. Claims are paid based on the order in which they are received. For example, if a claim is received for the total component and TMHP has already made payment for the technical or interpretation component for the same procedure, same dates of service, same client, any provider, the claim for the total component will be denied as previously paid to another provider. The same is true if a total component has already been paid and claims are received for the individual components Reference Labs and Lab Handling Fees An independent laboratory that forwards a specimen to another laboratory without performing any tests on that specimen may not bill for any laboratory tests. An independent laboratory may only bill Medicaid for tests referred to another laboratory (independent or hospital) if it performs at least one test (that it is Medicare-certified to perform) and forwards a portion of the same specimen to another laboratory (reference laboratory) to have one or more tests performed. In this instance, the referring laboratory may bill for tests it has performed and all tests it is to perform on the specimen. When billing, the Yes box in Block 20 of the CMS-1500 claim form must be marked, the name, address, and ZIP code of the reference lab to where the specimens have been forwarded must be indicated in Block 32, and the Texas Provider Identifier (TPI) and National Provider Identifier (NPI) of the reference lab must be indicated in Block 24-J next to each procedure to be performed by the reference lab. The TPI goes in the shaded area of the block. The NPI goes in the unshaded area of the block. Only one handling fee may be charged per day, per client, unless specimens are sent to two or more different laboratories; this must be documented on the claim. An independent laboratory that forwards a specimen to another laboratory (independent or hospital) may bill a handling fee (procedure code 99001) for collecting and forwarding the specimen to the other laboratory if the specimen is collected by routine venipuncture or catheterization. Routine venipunctures or finger, heel, and ear sticks for collection of specimen(s) (procedure code 36415) are not benefits of Medicaid. Family planning agencies must use procedure code with modifier FP to bill their laboratory handling charges for laboratory specimens sent out. As with the procedure code 99000, only one handling fee may be charged for each laboratory to the agency that sends specimens, regardless of the number of specimens taken. When family planning test specimens such as Pap smears are collected, providers must direct the laboratory to indicate the claim for the test is to be billed as a family planning service Repeated Procedures Modifier 91 Modifier 91 should be used for repeat clinical diagnostic tests as follows: Modifier 91 must not be used when billing the initial procedure. It must be used to indicate the repeated procedure. If more than two services are billed on the same day by the same provider, regardless of the use of modifier 91, the claim or detail is denied. If a repeated procedure performed by the same provider on the same day is billed without modifier 91, it is denied as a duplicate procedure. If a claim is denied for a quantity more than two or as a duplicate procedure, the times of these procedures and services must be documented on appeal. Modifier 91 is not required and must not be used when billing multiple quantities of a supply. For dates of service on or after April 3, 1998, certain procedure codes have been removed from modifier 91 auditing. These are procedure codes that have been identified as routinely being performed at the same time, more than twice per day for each antigen (e.g., agglutinins, febrile [e.g., Brucella, Francisella, Murine typhus, Q fever, Rocky Mountain spotted fever, scrub typhus], each antigen). Providers may still appeal claims that have been denied for documentation of time. Most procedure codes initially requiring modifier 91 will continue to be audited for modifier 91. When appealing claims with modifier 91 for repeat procedures, providers must separate the details. One detail should be appealed without the modifier and one detail with the modifier, including documentation of times for each repeated procedure Modifier 76 Modifier 76 is limited as follows: Modifier 76 must not be used when billing the initial procedure. It must be used to indicate the repeated procedure. If more than two services are billed on the same day by the same provider, regardless of the use of modifier 76, the claim or detail is denied CPT only copyright 2008 American Medical Association. All rights reserved.

5 Independent Laboratory If a repeated procedure performed by the same provider on the same day is billed without modifier 76, it is denied as a duplicate procedure. If a claim is denied for a quantity more than two or as a duplicate procedure, the times of these procedures/services must be documented on appeal. Modifier 76 is not required and must not be used when billing multiple quantities of a supply. Certain procedure codes have been removed from modifier 76 auditing for dates of service on or after April 3, These procedure codes have been identified as routinely being performed at the same time, more than twice per day for each antigen (e.g., agglutinins, febrile [e.g., Brucella, Francisella, Murine typhus, Q fever, Rocky Mountain spotted fever, scrub typhus], each antigen). Providers may still appeal claims that have been denied for documentation of time. Most procedure codes initially requiring modifier 76 will continue to be audited for modifier 76. When appealing claims with modifier 76 for repeat procedures, providers must separate the details. One detail should be appealed without the modifier and one detail with the modifier, including documentation of times for each repeated procedure Laboratory Paneling The reimbursement for the complete panel procedure code represents the total payment for all laboratory services covered under that panel. The Medicaid allowable fee for the individual components of the complete lab panel does not exceed the fee for the complete lab panel. The provider is reimbursed the lesser of the combined fees for the two or more laboratory services delivered or the single panel fee. When all of the components of the panel are performed, the complete panel procedure code must be billed. When only two or more components of the panel are performed, the individual procedure codes for each laboratory test performed may be billed. Refer to: Laboratory Services on page Chemistry Tests Medicare policy pertaining to laboratory paneling procedures was implemented by Medicaid. Organ and disease panel codes 80048, 80051, and must be used instead of the general multichannel automated panel codes. Procedure code is considered a component of the multiple chemistry panels. Procedure code is considered a component of any hemogram with a platelet panel. Hemogram or CBC with platelet panel codes to must be billed when two or more components of a CBC and a platelet count are performed. When two or more components of a CBC and a platelet count are billed separately on the same day, all components are denied with explanation of benefits (EOB) 00559, These tests must be combined and billed as a CBC/panel. Resubmit with signed claim copy, R&S report copy, and appropriate code (85025 and 85027). The chemistry tests in the following table must be billed individually unless a complete panel is performed: Urinalysis Procedure codes 81000, 81001, 81002, 81003, 81005, 81015, 81020, 84578, 84580, and are only payable as a total component (type of service 5) and are not payable in the inpatient hospital setting. Procedure code may be reimbursed on the same date of service as a urinalysis with or without microscopy for procedure codes 81000, 81001, 81002, 81003, 81005, and Procedure code is denied as part of another service when submitted for the same date of service as procedure code or Procedure codes and are denied as part of another service when submitted for reimbursement with procedure code for the same date of service by the same provider. Procedure codes 81002, 81003, 81007, and are denied as part of another service when submitted for reimbursement with procedure code for the same date of service by the same provider. Procedure code is denied as part of another service when submitted for reimbursement with procedure code 81003, 81005, or for the same date of service by the same provider. Procedure code is denied as part of another service when submitted for reimbursement with procedure code for the same date of service by the same provider. When related urinalysis procedure codes are billed for the same date of service by the same provider, the first procedure code is reimbursed and all other procedure codes are denied. An explanation of benefits (EOB) code will appear on the Remittance and Status (R&S) report indicating the claim should be resubmitted with a copy of the R&S report and an appropriate urinalysis procedure code that combines the related components. 26 CPT only copyright 2008 American Medical Association. All rights reserved. 26 5

6 Section CBC Texas Medicaid considers a baseline CBC appropriate for the evaluation and management of existing and suspected disease processes. CBCs should be individualized and based on client history, clinical indications, or proposed therapy and will not be reimbursed for screening purposes. The following procedure codes will be denied as part of another service when billed with procedure code for the same date of service by the same provider: Procedure code will be denied as part of another service when billed with procedure code 85007, 85009, 85025, or for the same date of service by the same provider. Procedure code will be denied as part of another service when billed with procedure code for the same date of service by the same provider. Procedure code will be denied as part of another service when billed with procedure codes for the same date of service by the same provider 85004, 85025, 85027, 85032, 85048, or Procedure code will be denied as part of another service when billed with procedure code for the same date of service by the same provider. Procedure code 85013, 85014, or will be denied as part of another service when billed with procedure code or for the same date of service by the same provider. Procedure code will be denied as part of another service when billed with procedure code Procedure code will be denied as part of another service when billed with procedure code 85025, 85027, 85041, 85048, or Procedure codes will be denied as part of another service when billed with procedure code or Procedure codes will be denied as part of another service when billed with procedure code or Procedure code will be denied as part of another service when billed with procedure code Procedure codes will be denied as part of another service when billed with procedure code or Procedure code will be denied as part of another service when billed with procedure codes or A CBC is a comprehensive service that includes components. The components of a CBC are listed in the following table: Procedure code may be reimbursed separately If this procedure code is billed for the same date of service as procedure codes or 85027, it will deny as part of another service. Reticulocyte procedure codes 85044, 85045, and may be reimbursed in addition to a CBC Organ or Disease Panels Organ panels are specific laboratory studies that have been combined under a problem-oriented classification as an approach to diagnosis. The following list of panels includes all components that must be included to report the panel code. Individual laboratory studies considered a part of a specific panel are denied when billed on the same day as the panel code by the same provider. The panels include the following procedure codes: Panel must include: Panel must include: Panel must include: PLUS OR and either 85004, 85007, or Panel must include: Panel must include: CPT only copyright 2008 American Medical Association. All rights reserved.

7 Independent Laboratory Panel must include: PLUS OR and either 85004, 85007, or Panel must include: Panel must include: Panel must include: Panel must include: Ferritin and Iron Studies Procedure codes 82728, 83540, 83550, 84466, and are a benefit when medically necessary and are payable in the office, inpatient and outpatient hospital, and independent laboratory setting for the following diagnoses: Diagnosis Codes Diagnosis Codes The following diagnosis codes will no longer be reimbursed for procedure codes 82728, 83540, 83550, 84466, and 85536: Diagnosis Codes V560 V5631 V5632 V CPT only copyright 2008 American Medical Association. All rights reserved. 26 7

8 Section 26 Procedure codes 82728, 83540, 83550, 84466, and may be reimbursed on the same day for the same provider, except when and are billed on the same day. If procedure codes and are billed on the same day, procedure code may be reimbursed and procedure code will be denied. Providers must use the appropriate modifier when billing these procedure codes more than once on the same day by the same provider. Iron studies may be reimbursed only to physicians, independent laboratories, Federally Qualified Health Centers (FQHCs), inpatient and outpatient hospitals, nephrologists, renal dialysis facilities, and rural health clinics. Type of service I is no longer payable for procedure codes 83540, 83550, and Laboratory Services for Clients on Dialysis Texas Medicaid provides reimbursement for laboratory services performed for clients on dialysis. Charges for routine laboratory tests performed according to the established frequencies are included in the facility s dialysis charge billed to Medicaid regardless of where the tests were performed. Routine laboratory services performed by an outside laboratory are billed to the facility. Nonroutine laboratory services for clients dialyzing in a facility and all lab work for clients on continuous ambulatory peritoneal dialysis (CAPD) may be billed separately from the dialysis charge. These services and recommended frequencies are listed in Laboratory and Radiology Services on page Transfusion Medicine Procedure code is denied when billed by any provider for the same client for dates of service in excess of two times within four days. The use of modifier 76 does not prevent claim denials. Documentation may be submitted on appeal that supports the medical necessity and appropriateness of more than two predeposited autologous donations in four days Claims Information When family planning test specimens such as Pap smears are collected, providers must direct the laboratory to indicate the claim for the test is to be billed as a family planning service using diagnosis code V2509. A National Provider Identifier (NPI) is required for all claims. In addition, for paper claims, the Texas Provider Identifier (TPI) is required for the billing and performing provider only. NPI-only is required for all other fields. Providers must submit independent laboratory services to TMHP in an approved electronic format or on a CMS-1500 paper claim form. Providers must purchase CMS-1500 claim forms from the vendor of their choice. TMHP does not supply the forms. When completing a CMS-1500 claim form, all required information must be included on the claim, as information is not keyed from attachments. Superbills, or itemized statements, are not accepted as claim supplements. Refer to: TMHP Electronic Data Interchange (EDI) on page 3-1 for information on electronic claims submissions. Claims Filing on page 5-1 for general information about claims filing. CMS-1500 Claim Filing Instructions on page Blocks that are not referenced are not required for processing by TMHP and may be left blank Electronic Filing for Laboratory Providers Referring provider information is always required on laboratory claims. Failure to submit this data will result in a claim rejection on the TMHP Electronic Data Interchange (EDI). When the place of service is 6 and the billing provider identifier belongs to a laboratory, there is no need to submit the same provider identifier in the facility ID field. This notation causes the claim to suspend processing unnecessarily, and may cause a delay in the disposition of the claim. For questions about the electronic fields, contact the commercial software vendor or the TMHP EDI Help Desk at Claim Filing Resources Refer to the following sections and/or forms when filing claims: Resource Page Number Automated Inquiry System (AIS) xiii TMHP Electronic Data Interchange 3-1 (EDI) CMS-1500 Claim Filing Instructions 5-26 TMHP Electronic Claims Submission 5-15 Communication Guide A-1 Independent Laboratory Claim D-19 Example Acronym Dictionary F CPT only copyright 2008 American Medical Association. All rights reserved.