Let's Take a Stab at Labs

Published 08/06/2021

Laboratory services continue to be a major contributor to the improper payment rate of claims reviewed by the Comprehensive Error Rate Testing (CERT) contractor. 

A lab test is categorized as a diagnostic service. These services can be ordered by a treating physician, nurse practitioner, clinical nurse specialist or physician assistant. A “testing facility” is a Medicare provider or supplier that furnishes diagnostic tests and may include a physician or a group of physicians, radiologists, pathologists, a laboratory, or an independent diagnostic testing facility (IDTF).

When laboratory services are provided, the order — or intent to order — is vital and must be included in the medical record. If you bill laboratory services to Medicare, you must obtain the treating physician's signed order or signed progress note to support intent to order, and documentation to support medical necessity for the ordered services. Verifying the ordering or treating provider’s intent and involvement with requesting the patient’s tests is a crucial aspect of establishing medical necessity. Documentation in the patient’s medical record must support the medical necessity for ordering the services per Medicare regulations and applicable Local Coverage Determinations (LCDs). These records need to be available to submit upon request to the CERT contractor:

  • Properly signed progress notes or office notes that support orders. For example, for the same date of service that test was performed, or from a prior visit, depending on type of testing performed.
  • Physician order or intent to order with a proper signature
  • Laboratory results, and how results affected the care provided
  • Attestation or signature log for illegible signatures. Attestations can be found on the CERT contractors’ website C3Hub.

Are you wondering why you received a request from CERT and you didn’t submit a claim for payment for a laboratory service?
Providers who order diagnostic services for Medicare patients must maintain documentation of the the order — or intent to order and medical necessity of the service(s) in the patient's medical record. This information must be available and submitted, along with the test results, upon request for a Medicare claim review.

While conducting medical review of the documentation received, the CERT medical review specialist may identify the need for additional information (elements listed above that were not submitted by the facility performing the services). A new additional documentation request will be issued to the ordering or referring provider to obtain the specific missing documentation. The response time for this second request is shorter. The CERT Review Contractor follows this schedule for these requests:

Day 1: First letter is mailed out.

Day 10: Second letter is mailed out.

Telephone contact is made by the CERT contractor and Palmetto GBA to follow up on requests and/or to ensure understanding of the requested documentation.

Day 16: Claim back in review process. If documentation was not received, this will result in the claim being denied.
Cooperation among ordering and referring providers and the facilities that perform diagnostic tests is key to reducing errors and avoiding claim denials. 


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