Palmetto Increases Fees For Higher Volume Tier 1 Codes

It is unlikely that these new price points are going to be sufficient for most labs because the new fees, in many cases, are still below cost. With that said, the new fees do take into account SOME of the information provided by CCLA labs to Palmetto over the past several weeks. However, without having details on how these prices were determined, labs will still be forced to speculate on how the prices were ultimately determined. It appears that certain individual procedures, including amplification and mutation identification procedures that would have been appropriately deemed payable under the stacked coding method, have been removed or devalued during the pricing of these new methodology-agnostic codes.

The payment decrease under the new fee schedules still represent a decrease in payment of 20 – 80% based on the specificity of the test being performed and the lab’s testing methodology. Palmetto has stated it will continue to review pricing through April, so labs should continue to direct their appeals to Palmetto through the end of the month. After that, the next opportunity to appeal these price points will be with CMS.

We would expect Palmetto J1 labs to start seeing payments based on the new fee schedules in the next several weeks. The fees would be effective for all claims with a date of service beginning January 1st, 2013.