CMS Increases Payment Rates for Certain COVID-19 Tests

April 20, 2020
Firm Publication

In connection with its efforts to expand COVID-19 testing, the Centers for Medicare & Medicaid Services (CMS) announced last week that it will increase payment for high-throughput COVID-19 lab tests to $100. Before this announcement, these tests were reimbursed at a rate of $51. According to CMS, such rates do not appropriately reflect the actual costs of high-throughput testing services.

CMS Administrator Seema Verma called this action a “game-changer” and a “critical move to ensure adequate reimbursement for advanced technology.” High-throughput testing technology has the capability of processing more than 200 specimens per day, using highly sophisticated equipment and specially trained technicians. These tests can also produce faster results, which CMS hopes will more effectively combat the spread of the virus. This is particularly important for the Medicare population, including nursing home residents, which are some of the most vulnerable populations.

CMS has already taken several measures to expand COVID-19 testing, including paying new specimen collection fees for COVID-19 tests administered to homebound and non-hospital inpatients unable to travel and permitting hospitals, labs or other entities to conduct COVID-19 testing at locations outside the facility, in patients’ homes or community-based settings. This new measure is meant to align reimbursement with the increase in operational costs associated with high-throughput testing technology.

The payment increase for high-throughput testing became effective April 14 and will last through the duration of the COVID-19 national emergency. High-throughput testing should be identified in claims by using the following CPT codes:

  • U0003 – Infectious agent detection by nucleic acid (DNA or RNA); severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) (Coronavirus disease [COVID-19]), amplified probe technique, making use of high throughput technologies as described by CMS-2020-01-R.
  • U0004 – 2019-nCoV Coronavirus, SARS-CoV-2/2019-nCoV (COVID-19), any technique, multiple types or subtypes (includes all targets), non-CDC, making use of high throughput technologies as described by CMS-2020-01-R.

For all other COVID-19 laboratory tests, local Medicare Administrative Contractors (MACs) will remain responsible for developing the payment rates in their respective jurisdictions.

If you have questions about this new payment policy or clinical laboratory services in general, please contact the authors.