Clinical Laboratory and Pathology billing and accounts receivable

Laboratory billing turns on medical necessity for the ordering diagnosis, panel-versus-component rules, and who is permitted to bill for the interpretation.

Where the money leaks in clinical laboratory and pathology

These are the recurring denial reasons in this specialty. They are not exotic. They are the ordinary ones that go unworked because the person who could fix them is at the front desk answering a phone.

• Panel components billed separately when the payer pays the panel code
• Tests denied for a diagnosis not on the coverage policy's approved list
• Missing or invalid ordering provider NPI, which stops the claim rather than reducing it
• Frequency limits exceeded on monitoring tests within a rolling period
• Technical and professional components billed by the wrong entity, or both by both

What a seat does about it

One trained person works your queue from the difficult end. Every call is logged with the payer reference number and the outcome, so an appeal can quote what was said rather than start again. Denials are categorised, which is how the same reason stops coming back next month. On Friday you get it in writing.

The roles that matter most in this specialty are AR calling and denials at $1,700, prior authorization at $1,900, and certified coding at $2,500.

The codes those turn into

Each of these is a denial code you are likely to meet working clinical laboratory and pathology, matched to the problem above it in your own words. The route back to payment differs by code, so a queue sorted by recovery route clears faster than one sorted by date.

• CO-22 — May be covered by another payer
  The payer thinks somebody else is primary. Until coordination of benefits is corrected on their file, nothing on this claim will pay.
  Recovered by being fixed at coordination of benefits and rebilled. Matched from: “Tests denied for a diagnosis not on the coverage policy's approved list”
• CO-16 — Claim lacks information
  Something on the claim is missing or malformed. On its own the code tells you nothing — the detail is in the remark code that comes with it.
  Recovered by being corrected and resubmitted. Matched from: “Missing or invalid ordering provider NPI, which stops the claim rather than reducing it”

Working a denied claim costs $57.23 per denied claim in administrative time (source), and about about 90% of initially denied claims are eventually paid. Most of what sits in a clinical laboratory and pathology AR bucket is not lost money. It is money waiting for somebody with the hours to make the call.

Questions