Final MoPath Prices About 26% Higher on Average, but Many Questions Remain

Final Medicare prices for 65 molecular pathology test (MoPath) codes announced Sept. 30 show some improvement over interim rates released earlier this year, but many question remains about why the remaining codes weren’t priced and why Medicare contractors will be allowed to set their own prices for molecular tests in 2014. The final Medicare prices for 65 MoPath test codes for 2014 average about 26 percent higher than the proposed rates released in May 2013. However, groups representing labs are concerned that the Centers for Medicare and Medicaid Services (CMS) priced only 65 of the 116 new MoPath CPT codes and that agency appears to be ignoring a requirement that 2014 prices be based on the median of all contractor rates. According to CMS, only codes that are currently being paid by MACs were priced. Some codes listed in the May 9, 2013, proposed price posting are not listed in the final prices because the service is no longer being paid by the MAC. This failure to price all of the new MoPath codes leaves much uncertainty over the status of the nonpriced codes, say industry experts. CMS is allowing a 30-day reconsideration period on these final prices, so it is possible that there could be additional changes when the agency announces final amounts for the 2014 Clinical Laboratory Fee Schedule later this fall. While final pricing for some codes improved when compared to the proposed rates issued earlier this year, many of them are still well below what labs had been paid under the code-stacking methodology. Overall, it is difficult to discern any real trend in price adjustments since some went up while others went down. For example, while the average final Medicare payment for CPT 81206 (BCR/ABL1 gene major bp) is $187, an 87 percent increase over the average proposed (interim) price of $100, pricing for CPT 81295 (MSH2 gene analysis) dropped 64 percent to an average of $292. Altogether, 39 tests received an average nationwide price boost over their proposed price, while 19 saw cuts and six were unchanged. Thirteen tests saw their final prices increased over what would have been paid using code-stacking methodology from Quest Diagnostics, while 24 were cut, most by double-digit percentages (see charts on pages 4 and 5). Pricing released by Palmetto GBA led to increases of prices on 43 tests and price reductions on 22 others that ranged from nominal to as high as 81 percent. Some of the tests received pretty dramatic boosts over the proposed prices that had been released in the spring. NPM1 gene analysis, CPT code 81310, was priced at a national average of $212, up 264 percent from the average proposed price of $58. It was also up 261 percent from the original code-stacked price of $59. It also fared well in California and Utah, where it is priced at $249, up 327 percent from the original proposed price. Chimerism analysis, CPT code 81268, was priced at an average of $312, up 102 percent from the original proposed price of $150. However, it still fell far short of the original code stacking price of $1,109. Another test that fared well from its proposed to final average price was MLH1 gene analysis familial variant, CPT code 81293. It originally had a proposed price of $91 but came in at $240, a bump of 165 percent. It also fared well in code stacking, where Medicare originally paid $94, representing a bump of 156 percent. “The bottom line is there was some improvement,” said Michael Arnold, president of the California Clinical Laboratory Association, one of the most vocal of the regional lobbying groups on the molecular coding issue. However, Arnold added that he would have liked to see the prices rise even further. Not every code emerged unscathed. An MSH2 full-sequence gene analysis test, CPT code 81295, was priced at $292, a 64 percent reduction from the average proposed price of $809 and a 60 percent drop from the code-stacked price of $730. Palmetto cut pricing on that assay 81 percent from its original proposal, down to $153. Many Tests Not Priced Meanwhile, some industry experts have expressed concern about what did not receive specific prices: 51 separate tests. They include ASPA gene analysis, CPT code 81200, which was paid at $213 under code-stacking; CFTR gene analyses, CPT codes 81220 to 81224; and long QT gene analysis, CPT codes 81280 to 81282. “We are extremely concerned about the apparent lack of coverage for many of these tests, despite their current use in patient management, the availability of medical literature supporting those uses, and their inclusion in practice guidelines. In many cases, the results and interpretations provided in the reports of these medically necessary tests are used to determine patient treatment,” said Stephen Black-Schaffer, M.D., a Massachusetts pathologist who is vice chairman of the economic affairs committee of the College of American Pathologists. “CAP is concerned that many proposed contractor coverage decisions would deny beneficiaries’ access to molecular testing that is necessary for their diagnosis and management.” Ignoring Statutory Requirements Groups and labs are also concerned about statements by CMS that carriers who priced a code below the national limitation amount (NLA) could continue to reimburse for the code at that lower rate after Jan. 1, 2014, when the NLA is to take effect. In the Sept. 30 announcement of final prices, CMS states, “If an individual MAC establishes a price that is lower than the NLA, it may continue to pay that price in 2014.” This appears to be in direct contradiction to the final Physician Fee Schedule rule for 2008, which laid out the gap-fill process. That rule, published in the Nov. 27, 2007, Federal Register, states that gap-filling is used when no comparable existing test is available:

In the first year, carrier-specific amounts are established for the new test code using the following sources of information to determine gap-fill amounts, if available: charges for the test and routine discounts to charges; resources required to perform the test; payment amounts determined by other payers; and charges, payment amounts, and resources required for other tests that may be comparable or otherwise relevant.

In the second year, the test code is paid at the national limitation amount, which is the median of the carrier-specific amounts.

While some contractors, such as Noridian and Palmetto, have adopted the NLA rates as their final prices, others, such as Cahaba, continue to price tests at a much lower rate. For example, while the NLA for BCR/ABL1 (CPT 81206) is $225.38, Cahaba’s price is $123. And while the NLA for MSH6 gene analysis (CPT 81300) is $162.90, Cahaba is paying just $50. Cahaba administers Medicare Part B for Alabama, Georgia, and Tennessee. The American Clinical Laboratory Association and other groups say they intend to challenge CMS’s statement that it will allow MACs to pay a lower price than the NLA, noting that the statement “is inconsistent with the clear language of the gap-fill regulations, which states that after the first year payment for gap-filled tests is made at the NLA amount.” Reconsideration Requests Reconsideration requests must be received by Oct. 30, 2013, and should be sent to MoPathGapfillinquiries@cms.hhs.gov. According to CMS, the requests must include the following specific information about your test:

• »Test methodology (e.g., real-time quantitative PCR, reverse-transcription PCR, flow cytometry, capillary electrophoresis, fragment analysis, etc.)
• »Specific cost per sample (specify reagent, direct labor costs, indirect costs, etc.)

Once the reconsideration process is completed, the determination is final and will not be subject to further consideration. MACs will continue to determine pricing for the remainder of 2013. The final gap-fill amounts, listed by state, are available at www.cms.gov/Medicare/Medicare-Fee-For-Service-Payment/ClinicalLabFeeSched. Click on “Gapfill Pricing Inquiries.” The chart on the following page shows the NLA, average final prices, average proposed (interim) prices, code-stacking prices (where available), and the differences in those prices.

FINAL MEDICARE MOLECULAR PATHOLOGY PRICES
HCPCS/CPT	Descriptor	National Limit	Average Final	Code Stacked Price*	% Chg. From Stacked	Proposed Average	% Chg. From Avg. Proposed
81206	BCR/ABL1 gene major bp	$225.38	$187	$61	207%	$100	87%
81207	BCR/ABL1 gene minor bp	$199.08	$168	$61	175%	$87	93%
81208	BCR/ABL1 gene other bp	$221.09	$205			$149	38%
81210	BRAF gene analysis	$180.60	$162	$259	-38%	$88	84%
81211	BRCA1, BRCA2 gene analys.	$2,795.09	$2,842	$3,340	-15%	$2,845	0%
81212	BRCA1, BRCA2 185delAG	$178.04	$182			$181	1%
81213	BART testing	$587.12	$598	$700	-15%	$598	0%
81214	BRCA1 full sequence analysis	$1,449.01	$1,457			$1,457	0%
81215	BRCA1 full gene known fam.	$93.94	$91			$90	0%
81217	BRCA2 gene known fam. Var.	$93.94	$91			$90	0%
81225	CYP2C19	$294.00	$275	$290	5%	$223	23%
81226	CYP2D6	$455.00	$405	$159	154%	$278	46%
81227	CYP2C7	$176.40	$153	$219	-30%	$126	21%
81235	EGFR	$332.50	$279	$302	-7%	$185	51%
81240	F2 gene analysis	$67.64	$62	$136	-55%	$43	45%
81241	F5 gene analysis	$84.00	$77	$136	-43%	$73	6%
81245	FLT3 gene analysis	$167.17	$153	$344	-56%	$97	38%
81256	HFE gene analysis	$89.84	$84	$95	-12%	$70	20%
81261	IGH gene rearrangement	$272.15	$250	$154	62%	$164	52%
81262	IGH direct probe	$60.00	$60			$54	11%
81263	IGH variable region somat	$404.83	$367	$227	62%	$253	45%
81264	IGK gene rearrange analys	$205.26	$197			$122	61%
81265	IGK short tandem repeat	$295.60	$286	$777	-63%	$404	-29%
81267	Chimerism analysis, post trans.	$285.17	$257	$1,109	-77%	$155	66%
81268	Chimerism analysis, post trans. with cell selection	$358.47	$312	$1,109	-72%	$155	102%
81270	JAK2 gene analysis, variant	$126.00	$119	$88	35%	$82	45%
81275	KRAS gene analysis, variants	$198.97	$238	$911	-74%	$234	2%
81291	MTHFR gene analysis	$60.00	$64	$130	-51%	$87	-27%
81292	MLH1 gene analysis; full seq.	$651.12	$710	$900	-21%	$836	-15%
81293	MLH1 gene analysis, fam var.	$261.02	$240	$94	156%	$91	165%
81294	MLH1 gene analysis; dup del	$192.12	$228	$270	-15%	$486	-53%
81295	MSH2 gene analysis, full seq	$152.86	$292	$730	-60%	$809	-64%
81296	MSH2 gene analysis; fam var.	$130.51	$127	$94	36%	$95	35%
81297	MSH2 gene analysis; dup/del	$152.86	$201	$270	-25%	$536	-62%
81298	MSH6 gene analysis; full seq.	$290.01	$421	$870	-52%	$714	-41%
81299	MSH6 gene analysis; fam. Var.	$162.46	$152	$94	62%	$90	68%
81300	MSH6 gene analysis; dup/del	$162.90	$178	$270	-34%	$484	-63%
81301	Microsatellite instability anal	$398.03	$371	$321	16%	$313	19%
81310	NPM1 gene analysis, exon 12	$249.01	$212	$59	261%	$58	264%
81315	PML/RARalpha translocation	$284.97	$230	$160	44%	$105	119%
81316	PML/RARalpha com single	$434.65	$260			$123	111%
81317	PMS2 gene full seq analysis	$787.19	$830	$1,130	-27%	$722	15%
81318	PMS2 known familial variant	$186.01	$173			$90	91%
81319	PMS2 gene dup/del var	$223.34	$216	$462	-53%	$431	-50%
81321	PTEN gene analysis, full seq	$605.24	$610			$582	5%
81322	PTEN known fam var	$58.84	$89			$63	42%
81323	PTEN dup/del	$88.26	$151			$90	67%
81332	SERPINA1 gene-A1 antitrys	$60.00	$63	$94	-33%	$70	-10%
81340	TCR gene rearrange amp	$287.17	$260			$147	77%
81341	TRB gene rearrange direct	$68.16	$66			$46	44%
81342	TRG (T cell antigen recept)	$276.98	$258	$83	212%	$157	64%
81370	HLA class I and II typing	$552.75	$528			$533	-1%
81371	HLA verif typing	$330.84	$317			$326	-3%
81372	HLA class I typing, low res	$303.64	$303			$311	-3%
81373	HLA class I locus, low res	$153.08	$154			$157	-2%
81374	HLA class I one antigen equi	$100.00	$106			$113	-7%
81375	HLA clas II typing, low res	$303.43	$288			$283	2%
81376	HLA class II, one locus low res	$168.00	$161			$158	2%
81377	HLA class II one antigen equ	$126.20	$121			$122	-1%
81378	HLA class I and II typing high res	$475.00	$460			$465	-1%
81379	HLA class I typing, high res	$461.00	$447			$432	3%
81380	HLA class I one locus, high res	$243.64	$237			$236	1%
81381	HLA class I, one allele	$130.00	$114			$118	-3%
81382	HLA class II typing, one locus	$170.00	$170			$170	0%
Sources: CMS, Piper Jaffray. All CPT codes copyright American Medical Association. *Code stack price from Quest Diagnostics.