Molecular Pathology: Heed This Advice To Stay Clear In 2012

Tue, Mar 6, 2012 --

Coding Updates

With Medicare payment for 101 CPT® 2012 molecular pathology codes (81200-81048) hanging in the wind, does that mean you shouldn’t use the codes? That depends.

One thing is clear — most payers will continue to accept the molecular diagnostics “stacking codes” (83890-83914, Molecular diagnostics …) this year. Despite AMA instruction to use the stacking codes only for services not described by new Tier 1 or Tier 2 codes, CMS’s failure to price the new codes keeps 83890-83914 in the spotlight.

CMS to Labs: Use Both Code Families

You’re used to billing molecular diagnostics with stacking codes 83890-83914, and that doesn’t change in 2012 for most payers.

Use new codes, too: Medicare requests that, in addition to the stacking codes, labs also list “the new single CPT code that would be used for payment purposes if the new CPT codes were active.” CMS also requests that your Medicare claims reflect a charge for the new CPT code, even though the Medicare allowable for the new molecular pathology procedure codes is $0.00.

Here’s why: The Physician Fee Schedule lists molecular pathology codes 81200-81408 with procedure status indicator “B” (Bundled Code Payments for covered services are always bundled into payment for other services not specified…).

“While these services would traditionally be assigned a procedure status indicator of “I” (Not Valid for Medicare purposes Medicare uses another code for the reporting of, and the payment for these services), assigning these CPT codes a procedure status of B will allow CMS to gather claims information important to evaluating eventual pricing of these new molecular pathology CPT codes,” according to CMS Transmittal 2379 dated Jan. 18, 2012 (replacement for Transmittal 2369, dated Dec. 16, 2011).

Opportunity: Although Medicare doesn’t require labs to list new molecular pathology codes on 2012 claims, doing so gives you a chance to provide pricing information that could impact the eventual payment for these services.

“Despite Medicare instruction and the opportunity for pricing input, our billing department is hesitant to have us assign and price both sets of codes, because it looks like we’re double billing,” says Peggy Slagle, CPC, billing compliance coordinator at the University of Nebraska Medical Center in Omaha.

Do this: You can provide pricing input for molecular pathology tests that your lab performs by implementing the following steps and safeguards:

  • Keep the Medicare transmittal with your compliance documents.
  • “I’d recommend that you report the applicable 81200-81408 code and price it according to the amount you believe represents its fair market value, recognizing that the amount may be different than the sum of the prices you’ve assigned to the stacking codes,” says Dennis Padget, MBA, CPA, FHFMA, president of DLPadget Enterprises Inc. and publisher of the Pathology Service Coding Handbook, in The Villages, Fla.
  • Because CMS doesn’t provide a modifier or any other mechanism to indicate that the molecular pathology code (from the range 81200-81408) on your claim is non-payable, “you should monitor all such claims to ensure that your Medicare contractor denies the charge submitted with the new CPT code,” Padget says.
  • CMS also does not address how to report a pathologist’s interpretation of 81200-81408 codes. “In the spirit of establishing a crosswalk database for the future, I suggest that, unless CMS issues contrary instructions, you report the applicable CPT-2012 molecular pathology code with modifier 26 (Professional service) on any claims that list stacking-code 83912-26 (Molecular diagnostics, interpretation and report) for payment,” Padget says.

Go Rogue With Palmetto

If your Medicare contractor is Palmetto GBA Jurisdiction 1, ignore everything you just read for Part B claims. The stacking codes and 101 new CPT® codes aren’t in the mix for this MAC.

“Not only is Palmetto J.1 not recognizing new CPT 2012 molecular pathology codes, they won’t cover any of these tests without going through a phase 1 and phase 2 program determination to assign a proprietary ‘Z’ code,” says Diana Voorhees, MA, CLS, MT(ASCP)SH, CLCP, principal at DV & Associates Inc., in Salt Lake City.

Why and how: Palmetto J.1 has instituted a Molecular Diagnostic Services (MolDx) program to catalog tests and to establish coverage and payment policies. Each test must go through a technical assessment and coverage determination before being assigned a Z code. “A Z-Code uniquely identifies each molecular diagnostic test and enables a one-to-one mapping of a test to a code,” according to the Palmetto GBA Website (

Who must comply: “All hospital, private and reference laboratories that perform molecular diagnostic testing and bill Medicare in J1,” according to Palmetto.

The latest: In a Feb. 2012 update, Palmetto GBA announced that labs can apply for a Z-code (preferred, industry-wide designation), or alternately, a Palmetto Test Indicator (PTI, a J1-specific identifier). Lacking one of those options, MolDx Test Information form is available until Sept. 1, 2012.

Payment depends on it: “Claims received with paid dates of service on and after May 1, 2012, without one of the listed identifiers or a fax with the required information, will be rejected for insufficient documentation,” according the MAC.


Barnali is a medical coding and billing writer at TCI who has worked in the healthcare industry since 2009. She holds a master’s degree in English literature and a diploma in advertising and marketing. She enjoys writing about ICD-10 and Medicare compliance.

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