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Report (OEI-07-11-00011)

Coverage and Payment for Genetic Laboratory Tests

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OIG is currently conducting an evaluation entitled Payments for Laboratory Tests: Comparing Medicare, State Medicaid, and Federal Employees Health Benefits Programs (OEI-07-11-00010). The objectives of that evaluation are to determine (1) how the methods for establishing Medicare laboratory test payment rates vary from State Medicaid and Federal Employee Health Benefits (FEHB) programs, and (2) the extent to which 2011 Medicare payment rates for 20 high volume and/or high expenditure laboratory tests vary from State Medicaid and FEHB plans. During a meeting on June 29, 2011, CMS officials informed us that, in addition to high volume and high expenditure laboratory tests, a collection of pricing data for genetic tests from other health care insurers would assist CMS in establishing payment rates for genetic tests.


We surveyed State Medicaid and FEHB plan staff and interviewed Veterans Health Administration staff about their coverage policy and establishment of payment rates, and obtained 2011 payment rates for selected genetic tests by name and by Common Procedural Terminology code from each of the health care insurers we surveyed.


In our memorandum report, we present information provided to us through surveys and interviews in the areas of coverage policies, payment methods, and payment rates for genetic tests. We have provided this information for CMS's use in setting Medicare coverage and payment policies for genetic tests. Because State Medicaid programs and private health insurance plans closely monitor Medicare's coverage and reimbursement decisions, CMS's formulation of reimbursement rates for genetic tests may be useful to them.

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