Medical Necessity

The Laboratories will perform testing services only at the written or electronic request of authorized providers.

  • The Medical Center Compliance Committee has reiterated that a provider signature is required on any paper/written request submitted to the Laboratories. Instances of non-compliance will be reported to the compliance committee on a provider-specific basis with action taken as necessary.

The ordering provider shall provide the documentation/clinical indications - reason for testing, signs, symptoms, diagnosis codes on the written or electronic request to support the medical necessity of the testing service provided and billed. Providers are able to order any tests, including screening tests, which they believe are appropriate for the treatment of their patients.

Medicare will only pay for services that are covered, reasonable and necessary for the beneficiary, given his/her clinical condition. Tests submitted for Medicare reimbursement must meet program requirements or the claim may be denied.

  • The electronic order entry (IHIS, Atlas) systems utilize Advance Beneficiary Notices (ABN's) when there is a likelihood that an ordered service will not be paid for by the Medicare program.
  • The Laboratories require that the ABN accompany the Test Requisition Form when submitting specimens for laboratory testing unless an electronic order entry was used where the completed document is stored electronically.

The Laboratories will take all reasonable steps to ensure that it is not submitting claims for services that are not covered, reasonable, and necessary.

Standing Orders

Medicare discourages the use of standing orders as a result of potential problems related to the documentation that tests are reasonable and necessary.

The Laboratories do permit the use of standing orders at laboratory phlebotomy stations, executed in connection with an extended course of treatment. The request for a standing order must be made using an appropriate request form or electronic system and limited to no more than twelve months to ensure their continued validity. The request MUST indicate all the following:

  • Start Date
  • End Date (no more than 12 months after the start date)
  • Frequency (e.g. weekly, monthly)
    • NOTE: PRN is not acceptable - if a test/service is required outside the specified frequency, a new single order is required
  • Appropriate clinical indications (reason for testing, signs, symptoms, diagnosis codes)
  • Provider Signature

Test Panels: Medicare policy specifies that organ or disease related panels will only be paid when all components are medically necessary. Written requests for a panel of tests must be made using AMA CPT Terminology or submitted on a Clinical and Reference Laboratories' request form which specifies the exact test(s) included in a panel.

Reflex Testing: The Laboratories will perform reflex/confirmatory testing at additional charge for selected tests under the conditions indicated on the laboratory requisition form, in the electronic order entry system, and/or in the Laboratories Guide to Services. Ordering providers shall have the option to order tests with or without automatic reflex/confirmatory testing where appropriate. When confirmatory testing is mandatory, the requisition form, electronic order entry system and/or Laboratories Guide to Services will so indicate. If a written order is received for a test that usually reflexes and there is no reference to the reflex tests, the test will be performed with the automatic reflex/confirmatory test(s) as listed in the Laboratories Guide to Services.

Adding, Canceling or Changing a Test: The Laboratories’ will only make changes to an order for laboratory services with written or electronic verification from the provider. If a test was added or changed, the charges for the service will be corrected to reflect the procedures actually performed. If a test was cancelled, the charge will be credited.

Billing Tests: The Laboratories will submit claims for testing services for tests that were both ordered and performed. Should the laboratory receive a specimen for testing services without an order, or with an ambiguous test order that is subject to multiple interpretations, the laboratory will contact the ordering provider, or authorized designee, to determine exactly what tests are being requested. The Laboratories will ensure that there are no charges for tests which cannot be performed for any reason. Requests for charges to be credited after testing is already completed will be done according to Laboratories’ policy/procedure to ensure that claims are accurate and there is no potential for inducement, etc.

Medicare Laboratory Fee Schedule: Laboratory tests are paid according to the Ohio Medicare Laboratory Fee Schedule. The Medicaid reimbursement amount will be equal or less than the amount of Medicare reimbursement.

Corrective Actions: Corrective action is required for specimens not meeting acceptability standards before they can be processed for laboratory testing.

Specimens requiring corrective action will be preserved and retained until resolution has been completed, notification to discard has been received from the ordering provider and receipt of notification confirmed / documented, or integrity of the specimen is no longer acceptable.

Venipuncture blood (excluding blood culture specimens), urine, sputum, feces/stool, and line-draw blood specimens must be re-collected if they do not meet identification acceptability standards. Note - for outpatients that are no longer available at the collection site: a Laboratory Release form must be completed.

When the laboratory has received an improperly identified invasive specimen, a Laboratory Release form must be completed. The person who collected the specimen must complete the release form to establish the identification of the specimen. Release forms must be completed in person (or by authorized facsimile transmission for outreach/ off-site patients); no verbal verification is permitted.

Unsatisfactory specimen: whenever the laboratory receives a specimen with a condition which would affect the laboratory result (i.e. insufficient quantity for testing, clotted, hemolysis, icterus, lipemia, contaminated, improper collection container, transportation delays, improper storage) such that testing cannot be performed or a test result cannot be provided, laboratory personnel will notify appropriate clinical personnel responsible for the patient.

  • All requests from a physician to perform testing on an unsatisfactory specimen must be approved by an attending pathologist.