CMS Laboratory Date of Service Exception Policy Update

January 2019 ~

On January 3, CMS announced plans to exercise enforcement discretion for the laboratory date of service (DOS) exception policy for advanced diagnostic laboratory tests and molecular pathology tests excluded from the Medicare hospital outpatient prospective payment system packaging policy.

In the CY 2018 Hospital Outpatient Prospective Payment System (OPPS)/Ambulatory Surgical Center (ASC) final rule published December 14, 2017, CMS established another exception to laboratory DOS policy for Advanced Diagnostic Laboratory Tests (ADLTs) and molecular pathology tests excluded from OPPS packaging policy so that the DOS is the date the test was performed, if certain conditions are met. This new exception to the laboratory DOS policy became effective on January 1, 2018.

Specifically, in the case of a molecular pathology test or an ADLT that meets the criteria of section 1834A(d)(5)(A) of the Social Security Act, the date of service must be the date the test was performed only if the following conditions are met:

1. The test is performed following a hospital outpatient’s discharge from the hospital outpatient department;
2. The specimen was collected from a hospital outpatient during an encounter (as both are defined 42 CFR 410.2);
3. It was medically appropriate to have collected the sample from the hospital outpatient during the hospital outpatient encounter;
4. The results of the test do not guide treatment provided during the hospital outpatient encounter; and
5. The test was reasonable and medically necessary for the treatment of an illness.

If all of the requirements are met, the DOS of the test must be the date the test was performed, which effectively separates the laboratory test from the hospital outpatient encounter. As a result, the laboratory performing the test must bill Medicare directly for the test, instead of seeking payment from the hospital outpatient department.

CMS states it will exercise enforcement discretion until July 1, 2019, for the laboratory date of service exception policy for advanced diagnostic laboratory tests and molecular pathology tests subject to the new laboratory date of service exception policy.

Source(s): MLN Connects for January 3, 2019; CMS Laboratory Date of Service Policy;