What Not to Do: Customized Test Panels

We invite you to test your compliance expertise with a new feature in G2 Compliance Advisor. See if you can identify what the laboratory did wrong in the following scenario that puts it at risk of false claims liability for medically unnecessary testing.

Spot the Compliance Mistakes:

SITUATION

As a convenience to clients, Nonexistent Laboratories (NL) offers medical groups the option of designing their own customized test panels. NL requires the medical director of the group to sign off in advance to verify that every test in the panel is medically necessary. NL devises a special requisition form for the group listing each of its panels (but not its component tests). Individual physicians can order the test using the group’s NPI. At the bottom of the requisition, NL lists the following statement:

“In ordering the listed panels, the physician agrees that each test in the panel is medically necessary, reasonable and appropriate for purposes of evaluating, diagnosing and treating a patient’s medical condition.”

QUESTION

Can you spot the four things NL did wrong?

ANSWER

Physicians often welcome and sometimes even request the convenience of being able to order tests in panels. But while panels may make clients happy, they also raise medical necessity red flags. NL recognized and attempted to address those concerns. But it didn’t do so effectively. Here’s a rundown of the mistakes.

Mistake 1: Relying on Medical Director Verification
Mistake 2: Letting Physicians Order Panel Using Group NPI
Mistake 3: Not Listing Component Tests
Mistake 4: Relying on Medical Necessity Statement

For a full discussion of why these actions are mistakes and what you should be doing to address medical necessity concerns, see “Spot the Compliance Mistakes” in the March issue of G2 Compliance Advisor.