Laboratory Financial Management & Reimbursement Flashcards

Which coding system is primarily used for billing laboratory tests to Medicare?

Answer: Current Procedural Terminology (CPT) codes

CPT codes, maintained by the AMA, are the primary coding system used to bill clinical laboratory procedures to Medicare and other payers.

What document must a laboratory provide to a Medicare patient BEFORE performing a test that may be denied as not medically necessary?

Answer: Advance Beneficiary Notice (ABN)

An Advance Beneficiary Notice (ABN) must be issued before rendering the service so the patient can decide whether to proceed and accept financial responsibility.

Under the Protecting Access to Medicare Act (PAMA), Medicare payment rates for clinical diagnostic laboratory tests are based on:

Answer: The weighted median of private payer rates reported by applicable laboratories

PAMA requires that Medicare CDLT payment rates reflect the weighted median of private payer rates collected from applicable laboratories, shifting to market-based pricing.

A Local Coverage Determination (LCD) is primarily used in laboratory billing to:

Answer: Specify ICD-10 diagnoses supporting medical necessity for covered tests

LCDs issued by Medicare Administrative Contractors specify which ICD-10-CM diagnosis codes support medical necessity, determining when Medicare will cover a given test.

Which modifier is used on a Medicare claim to indicate that an Advance Beneficiary Notice was issued because the service may be denied as not medically necessary?

Answer: Modifier GA

Modifier GA is appended to a claim line to indicate that a valid ABN was on file, documenting that the patient was notified of potential non-coverage.

The 'Anti-Markup Rule' in laboratory billing prohibits:

Answer: Marking up the cost of tests referred to outside laboratories when billing Medicare

The Anti-Markup Rule prohibits the entity billing Medicare from marking up the price of laboratory tests performed by an outside entity under the billing entity's reassignment.

Which of the following best describes a 'National Coverage Determination' (NCD) compared to a Local Coverage Determination (LCD)?

Answer: NCDs apply nationwide and are issued by CMS; LCDs apply to specific MAC jurisdictions

NCDs are issued by CMS and apply uniformly across all Medicare jurisdictions, while LCDs are issued by individual MACs and apply only within their geographic jurisdiction.