The Office of Inspector General has released a report detailing questionable billing patterns among Medicare lab services. Here are 25 important takeaways from the report.
1. Medicare is the nation's largest payer for clinical lab services.
2. Part B Medicare enrollment increased 10 percent over the period of the study (2005-2010) whereas Medicare lab costs increased 29 percent.
3. Medicare payments for Part B lab services totaled $8.2 billion in 2010, the last year of the study.
4. The study used 13 different measures to differentiate whether a lab's billing was unusually high.
5. The OIG's final data set for the study included 145.6 million lab claims submitted by 94,609 labs for 23 million Medicare beneficiaries.
6. The OIG found nearly 20 percent of all lab payments were questionable, and Medicare allowed payments totaling $1.7 billion for those questionable labs.
7. The OIG found 1,032 labs had unusually high billing for five or more measures.
8. The most frequently exceeded thresholds among these labs were those for the following measures: high average allowed amounts per ordering physician, high percentage of claims with ineligible ordering-physician numbers, high percentage of claims with compromised beneficiary numbers and high percentage of duplicate lab tests.
9. A very high percentage of questionable labs were in California and Florida.
10. Some of the most common lab tests are for blood counts, lipid tests and unrinalyses.
11. Since 1997, lab payments have tripled.
12. All 13 measures the OIG used to identify questionable billing included:
• High average amount per claim
• High average number of claims per beneficiary
• High average allowed amount per beneficiary
• High number of claims per ordering physicians
• High average allowed amount per ordering physician
• High percentage of claims for beneficiaries with no related physician services
• High percent of claims for beneficiaries more than 150 miles from the ordering physicians
• High percentage of duplicate lab tests
• High percentage of claims with invalid ordering physician
• High percentage of claims with ineligible ordering physician
• High percentage of claims with compromised beneficiary number
• High percentage of claims with compromised ordering physician number
• High percentage of claims with compromised lab provider number
13. Four labs exceeded nine or more measures.
14. Eighty-seven labs exceeded the thresholds for seven or more measures.
15. Those 87 labs collected about $260 million dollars.
16. One Texas lab has 61,000 lab tests per ordering physician. This is 15 times the average of all labs.
17. For one lab in California, every single patient has a compromised beneficiary number and 45 percent of its physicians had ineligible ordering numbers.
18. One Florida lab had an average of 1,193 labs per patient — 16 times the average — and 107,000 per physician, which is 24 times the average.
19. Any lab that exceeded eight of the measures and had an average beneficiary amount of 2,400 tests per person — 33 times the average.
20. Fifteen percent of all labs with questionable billing were located in Florida.
21. About $350 million in labs were paid where the patient lived more than 150 miles from the ordering physician.
22. The OIG found $1.2 billion was paid where there was no associated physician service.
23. The OIG also found $235 million was paid for duplicate lab tests.
24. CMS is now denying claims where the physician has opted out of Medicare.
25. CMS has started investigations of dozens of labs based on the OIG report.
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