The integrity of the entire healthcare system relies on accurate and honest billing practices, but what happens when there is improper billing? It impacts everyone – from individual patients to insurance payors to taxpayers. One area of the healthcare system where this always seems to run rampant is laboratory testing. Inappropriate lab testing causes financial waste, resource waste, false positives, over diagnosing and even overtreatment. And let’s not forget about increased patient anxiety – waiting for test results can add stress and worry. Lab tests are vital for patient health, but can also be an easy target for fraud, waste, abuse and error. Would you be surprised to know that in 2025, we are still seeing improper COVID-19 billing? Is it still impacting your claims? Payors play a vital role in preventing improper billing of laboratory testing by staying informed and actively scrutinizing medical billing.
What to Look For
Finding and addressing inappropriate lab billing can be complex since there are many areas to focus on. The Pathology and Laboratory section contains almost 4,000 distinct CPT codes, so you’d think there’s a code for every test possible, right? Not exactly. One area of focus could be unlisted CPT lab codes. Almost every sub-section has its own unlisted code, and those should only be billed when there isn’t a more appropriate code available. While billing unlisted codes isn’t necessarily wrong, it can be suspicious if billed routinely.
There are certain lab tests that are inherently connected with others, and many times there is a specific CPT code for a panel of tests. Think about your last appointment for fasting bloodwork. You likely had a lipid panel run, which has its own CPT Code, 80061. This panel includes tests for total cholesterol, HDL and triglycerides. Separate billing for those included tests is considered unbundling. Some other common panel codes are: General Health Panel (80050); Electrolyte Panel (80051); Comprehensive Metabolic Panel (80053) and Renal Function Panel (80069).
Similar to panel testing, there are other lab codes used for detecting multiple things from one sample. Many of the urinalysis CPT codes fall under this rule. Another area to review are related to presumptive drug tests, CPT Codes 80305, 80306 and/or 80307. These tests are to be reported ONCE per date of service, irrespective of the number of drug class procedures or results.
Recent Cases Highlight the Scale of the Problem
The U.S. Department of Justice regularly announces significant settlements and convictions related to healthcare fraud. A quick search for ‘laboratory fraud’ on their website reveals several major cases which also illustrate the diverse nature of these schemes.
- Lab Operator Convicted of $4M Medicare Fraud Scheme1
- Lab Owner and Marketing Company Owner Both Found Guilty in Multi-Million Dollar Medicare and Medicaid Fraud Scheme2
- Laboratory Owners Charged in $36M COVID-19 Testing Fraud Scheme3
HCFS Has You Covered
Combating fraudulent billing in laboratory testing requires a multi-pronged approach. Payors need to leverage advanced data analytics to identify suspicious billing patterns. If you’re using the HCFSPlatform™, we’ve got you covered. Our Artificial Intelligence (AI) models identify spikes and other anomalous billing patterns on labs, DME, telehealth and more. We can also help identify new provider billing patterns to catch any inappropriate billing quickly. Additionally, we have peer comparison and individual tier alerts that identify outliers in billing. Some examples of our alerts include:
[2051-20] – UNLISTED CODES-LABORATORY/PATHOLOGY (PEER COMPARISON)
[2051-30] – UNLISTED CODES-LABORATORY/PATHOLOGY (INDIVIDUAL TIER)
[2053-01] – UNBUNDLING, BASIC METABOLIC (CALCIUM, IONIZED) LAB PANEL
[2054-01] – UNBUNDLING, BASIC METABOLIC (CALCIUM, TOTAL) LAB PANEL
[2057-01] – UNBUNDLING, LIPID LAB PANEL
[2117-01] – INAPPROPRIATE UNITS, PATHOLOGY/LABORATORY
[2441-20] – OUTLIER, EXCESSIVE BILLING OF ADVANCED DIAGNOSTIC LABORATORY TESTS (ADLTs)
[2667-01] – COLLUSION, PROVIDER REFERRALS, CLINICAL LABORATORY TESTS
1. https://www.justice.gov/opa/pr/lab-operator-convicted-4m-medicare-fraud-scheme
2. https://www.justice.gov/usao-mdtn/pr/lab-owner-and-marketing-company-owner-both-found-guilty-multi-million-dollar-medicare
3. https://www.justice.gov/usao-sdfl/pr/laboratory-owners-charged-36m-covid-19-testing-fraud-scheme
If you’re not using the HCFSPlatform™ and you’re interested in knowing more, email us at [email protected].
If you have questions or comments, you may email us at [email protected].
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