July 6, 2020
COVID-19 TESTING BRIEF
from Avalon Healthcare Solutions
Avalon is the expert in laboratory and medical specialty drug benefit management. Our solutions are driven by evidence-based medical science. Avalon’s core program includes full delegation of Routine Testing Management, Genetic Testing Management, Independent Laboratory Network Management, and Medical Specialty Rx Management. Our comprehensive solutions manage all out-patient lab spend across all lab testing types. Avalon helps physicians, consumers, and payers maximize the cost-effective use of diagnostic laboratory tests. Avalon Healthcare Solutions is a registered d/b/a of Avalon Health Services, LLC.
AVALON Laboratory Network Capability & Capacity Report
*Quest also notes that they plan to further increase COVID-19 PCR testing capacity to 150 tests/day.
ADDITIONAL TESTING INFORMATION
Quest testing capacity under strain as COVID-19 spreads around the country (reported June 25, 2020)
Despite the rapid expansion of testing capacity, demand for testing has been growing faster. Orders for molecular diagnostic services grew by approximately 50 percent over the past three weeks. Rapid growth in demand is stemming from: increasing spread of the virus across much of the United States; pre-op patients being tested before undergoing procedures in hospital settings; demand from additional sectors, such as federally qualified healthcare centers (FQHCs), nursing homes and prisons; orders from drive/walk through community events held in collaboration with government agencies and corporations; and organizations bringing employees back to work; among other factors. Despite record demand, Quest average turnaround time continues to be 1 day for priority 1 patients and 2-3 days for all other populations. However, given increased demand, we expect average turnaround times near term to extend in excess of 3 days.
to Offer LabCorp At-Home COVID-19 Test Collection (reported June 30, 2020)
Leading health and well-being company Humana Inc. (NYSE: HUM) announced a pilot home-testing program today that will enable at-home COVID-19 test collection for members, making Humana the first insurer to offer LabCorp’s at-home test-collection kits.
The total tests performed by these threeThe total tests performed by these threeThe total tests performed by these three entities is approximately 15M tests. Therefore, about 18M test were performed by other laboratories and facilities. This information serves as an illustration of the need for a broad, inclusive network of qualified providers, not only during a pandemic, but also on a routine basis to provide the best access for patients.
AMA CODING UPDATE
The codes noted in this section of the bulletin are the June updates from the CPT Assistant.
87301 Infectious agent antigen detection by immunoassay technique, (e.g., Enzyme Immunoassay [EIA], enzyme-linked immunosorbent assay [ELISA], Immunochemiluminometric assay [IMCA]) qualitative or semiquantitative, multiple-step method; adenovirus enteric types 40/41
87426 Severe acute respiratory syndrome coronavirus (e.g., SARS-CoV, SARS-CoV-2 [COVID-19])
The new codes will allow for more accurate reporting of immunoassay testing for SARS-Coronavirus antigen. It is worth noting that the code is not specific for SARS-CoV-2; it could be used for an immunoassay that detects antigenic proteins for either SARS-CoV or SARS-CoV-2. As the antigenic proteins across the SARS-Coronavirus family are highly conserved, the assays currently available are not capable of distinguishing between SARS-CoV and SARS-CoV-2.
It is also important to highlight that the new CPT code 87426, is a “child” of CPT code 87301 and therefore, the appropriate crosswalk for reimbursement should be similarly related. The following table describes new PLA codes that are proprietary to the manufacturer or to the performing laboratory. These codes are not currently priced by CMS.
TESTING TRENDS FROM THE AVALON NETWORK: FOLLOW-UP DATA
Non-COVID testing claims continue to progress back to the baseline. The most current claims count is slightly lower than expected. This flattening of the trend may be related to the current surge in COVID cases across the US, or it may merely be a seasonal effect. Laboratory test utilization tends to decline during the summer months and then returns to peak levels in September.
The heat map to the right depicts all COVID test types. As expected, U0003, the high-throughput RT-PCR test dominates the field and is continuing to increase. Antibody testing accounts for 22% of all COVID claims. The continued use of U0002 is surprising and most likely represents lab claims associated with a lab developed test (LDT). The “Other” category includes the following test types:
• U0004: COVID-19, any technique, multiple types or subtypes (incl. all targets), non-CDC
• U0001: CDC assay for COVID-19
• G2023 and G2024: specimen collection for COVID-19
• 86328: antibody tests with a single-step method immunoassay
The next chart demonstrates the increasing rate of COVID-19 test orders. The downward trend at the end of the graph is associated with incomplete claims versus a drop in test utilization.
The final chart illustrates the COVID-19 test utilization by place of service (POS), including a breakout of testing performed by laboratories participating in the Avalon network (41%). The 20% of non-Avalon independent labs are largely hospital laboratories billing as POS 81.
TRI-AGENCY GUIDANCE NOW AVAILABLE
On June 23, 2020, CMS posted frequently asked questions (FAQs)(1) to assist stakeholders with implementing health coverage issues that are related to Coronavirus Disease 2019 (COVID-19)(2). This is the second set of FAQs prepared jointly by the Department of Labor (DOL), the Department of Health and Human Services (HHS), and the Department of the Treasury (collectively, the Departments) to clarify temporary policies about diagnostic testing and coverage of services during the pandemic(3). In a nutshell, the Departments attempted to clarify specific issues about the responsibility of payers to reimburse for particular lab tests:
• Payers do not have to pay claims related to public health surveillance or employer-back-to-work COVID-19 lab testing.
• Payers must reimburse for medically necessary testing, including multiple testing, for any FDA-authorized or approved test -- including at-home self-collection kits.
• If a negotiated rate is inapplicable, payers must reimburse the cash price listed by a provider on a publicly-available website. If no price is listed, payers can seek to negotiate a rate. In addition, CMS will impose a $300 per day civil monetary penalty until the provider takes corrective action.
In addition, the Departments addressed how to determine whether a test is medically appropriate, which types of tests are required to be covered, balance billing issues, and other requirements, such as notice requirements about changes to benefit plans when the public health emergency ends.
Clarity About Health Plan Responsibility for Lab Test Reimbursement
The Departments confirmed that public health activities and employer back to work testing initiatives are not the type of diagnostic activities that trigger a health plan’s obligation under the FFCRA and CARES Act to pay for tests performed. Specifically, payers are not required to cover testing for purposes other than individualized diagnosis and treatment. The guidance document includes this question and answer:
Q5. Is COVID-19 testing for surveillance or employment purposes required to be covered under section 6001 of the FFCRA?
No. Section 6001 of the FFCRA requires coverage of items and services only for diagnostic purposes as outlined in this guidance. Clinical decisions about testing are made by the individual’s attending health care provider and may include testing of individuals with signs or symptoms compatible with COVID-19, as well as asymptomatic individuals with known or suspected recent exposure to SARS-CoV-2, that is determined to be medically appropriate by the individual’s health care provider, consulting CDC guidelines as appropriate 13. However, testing conducted to screen for general workplace health and safety (such as employee “return to work” programs), for public health surveillance for SARS-CoV-2, or for any other purpose not primarily intended for individualized diagnosis or treatment of COVID-19 or another health condition is beyond the scope of section 6001 of the FFCRA.
MEDICAL NECESSITY DETERMINATIONS
Under the CARES Act, an individual’s attending health care provider is responsible for determining medical necessity. In the Guidance, the Departments attempted to provide clarification to previous guidance with respect to how plans and issuers should determine if a provider is the “attending” health care provider. Specifically, the Departments clarified that:
“a health care provider need not be ‘directly’ responsible for providing care to the patient to be considered an attending provider, as long as the provider makes an individualized clinical assessment to determine whether the test is medically appropriate for the individual in accordance with current accepted standards of medical practice.” (emphasis added).
Providers seeking health plan reimbursement for COVID-19 tests and related items or services should be able to substantiate their assessment of medical necessity as a condition for seeking health plan payment. Unfortunately, the Guidance does not provide further clarification regarding whether and what type of health plan verification processes are appropriate for confirming that the individualized clinical assessment was performed and properly documented. For this reason, plans should proceed carefully with respect to any required verification process.
COVERAGE FOR DIFFERENT TYPES OF COVID-19 TESTS
The guidance clarifies that payers must reimburse for medically necessary testing, including multiple testing, for any FDA-authorized or approved test -- including at-home self-collection kits. The Departments encouraged payers to check the FDA website to verify claims that a company received or intended to apply for an Emergency Use Authorization (EUA). If no EUA request is submitted within a reasonable period of time or there are other problems with a test, the Departments explained that the FDA would “remove the manufacturer/laboratory and test from the list, and may take additional actions as appropriate.” Unfortunately, the Departments offered no further guidance about how a payer may recover payments made for tests that were never authorized.
LAB TEST PRICES AND BALANCE BILLING
The Departments touched on network pricing negotiations and balance billing, but the applicable Guidance4 leaves several issues unresolved. Under the CARES Act, payers are required to reimburse out-of-network COVID-19 claims in an amount equal to the out-of-network provider’s cash price as listed on a publicly available website. Avalon has cautioned its customers about how unscrupulous providers may attempt to leverage this requirement into a profit-making opportunity by inflating their “cash price” to levels that do not reflect usual and customary prices. To make matters worse, many of these providers have not posted their cash prices online, despite the $300/day civil monetary penalties that may be imposed due to their failure to do so. Neither the CARES Act nor the FFCRA forbids an out-of-network testing entity from balance billing a health plan enrollee for the difference between the list price and what a payer agreed to pay. Without any deterrent to prevent surprise medical bills, health plan enrollees may receive an out-of-network provider’s demand for hundreds or even thousands of dollars above and beyond the reimbursement amount set by CMS through its clinical lab fee schedule. Although the Departments suggested that some states have laws prohibiting balance billing that could apply in these scenarios, the Guidance falls sort of providing health plans with explicit permission to pursue price gougers through traditional program integrity interventions.
In summary, the Guidance reassures payers that they are not responsible for tests that are conducted for public health purposes. It also confirms that private plans are not expected to pay for millions of tests of asymptomatic people as the economy reopens and surveillance and immunity activities increase. Several questions remain unanswered, however, such as the extent to which health plans may impose verification processes around provider determinations of medical necessity, balance billing considerations, and the extent to which the Departments support health plan program integrity efforts.
1 -June 23, 2020 FAQs: https://www.cms.gov/files/document/FFCRA-Part-43-FAQs.pdf
2 - The FAQs attempt to provide clarifications regarding certain provisions of the Families First Coronavirus Response Act (the FFCRA), which was amended by the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act)
3 - The first set of FAQs were issued on April 11, 2020: https://www.cms.gov/files/document/FFCRA-Part-42-FAQs.pdf
4 - See, e.g., FAQ #10:
Q10. How do the requirements of section 3202(a)(2) of the CARES Act interact with state balance billing laws regarding reimbursement for items and services furnished by out-of network providers or providers that do not have a negotiated rate with a plan or issuer for COVID-19 tests?
Section 3202(a)(2) of the CARES Act provides that, if a plan or issuer does not have a negotiated rate with a provider of COVID-19 diagnostic testing, the plan or issuer shall reimburse the provider in an amount that equals the cash price for such service as listed by the provider on a public internet website, or the plan or issuer may negotiate a rate with the provider that is lower than the cash price. Plans and issuers that do not already have a negotiated rate with a provider may nevertheless seek to negotiate to determine a rate, and state laws governing reimbursements may apply. For example, many states have balance billing laws that establish dispute resolution processes for issuers and providers to determine reimbursement rates for certain items and services. Such dispute resolution processes would continue to apply in these states to the issuers and providers that do not already have a negotiated rate. Additionally, to the extent that a state law does not prevent the application of the requirements of section 3202(a) of the CARES Act, the state law is not preempted and continues to apply.