CMS adjusts Medicare COVID-19 test payments to boost turnaround times

October 16, 2020

Yesterday, CMS announced it intends to adjust Medicare payments for COVID-19 diagnostic testing performed using high-throughput technology in order to encourage labs performing these tests to improve turnaround times.

Beginning Jan. 1, 2021, CMS will only pay the $100 high-throughput rate to labs that complete testing within two calendar days of the specimen being collected. Labs that take longer than two days to produce a test result will receive a rate of $75. Previously, Medicare paid $100 for high-throughput tests, regardless of turnaround time.

CMS said its intent with this move is to ensure patients who test positive for the virus are made aware quickly so they can isolate and receive treatment.

However, labs who are aiming for the higher rate should keep in mind that the $100 payment will be made in two installments. The amended Administrative Ruling (CMS 2020-1-R2) will lower the base payment amount for COVID-19 diagnostic tests run on high-throughput technology to $75. Medicare will then make an additional $25 add-on payment to laboratories for a COVID-19 diagnostic test run on high throughput technology if the laboratory:

  • Completes the test in two calendar days or less, and
  • Completes the majority of their COVID-19 diagnostic tests that use high throughput technology in two calendar days or less for all of their patients (not just their Medicare patients) in the previous month.

The $25 add-on payment will be covered under HCPCS code U0005.

In the press release announcing this change, CMS said the purpose of these requirements is to both support faster high throughput COVID-19 diagnostic testing and to ensure all patients (not just Medicare patients) benefit from faster testing.

In April, CMS doubled the payment for COVID-19 tests performed using high throughput technology to $100. COVID-19 testing using high throughput technologies allows for increased testing capacity using an automated process that can administer more than 200 tests per day.

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