PROVIDENCE HEALTH & SERVICES | PHYSICIAN SALES AND SERVICE

November 2013

Dear Valued Health Care Provider,

This is your annual notification of laboratory compliance issues, as required by the Office of Inspector General (OIG). Please carefully review this summary of billing policies and Medicare and Medicaid rules for clinical laboratory testing. This notice will review coverage decisions and policies now in effect.

Providence Laboratory Billing Policy: All tests that are both ordered and performed are billed to the appropriate payer under the guidelines provided by the payer and in accordance with all federal, state, and local laws and regulations.

Orders: Our laboratory can only perform tests when properly ordered by a legally authorized provider. In Oregon,a legally authorized provider is identified as a licensed physician, dentist, or mid-level practitioner (ORS 438.430) hereafter referred to as clinician. Orders submitted under the office MAs or RNs name only are not acceptable. Orders must include the patient's full legal name, date of birth, reason for the test ordered, date and time of collection, source when applicable, and clinicians name. Medicare requires hand-written orders to be signed and dated by the provider; however pre-printed laboratory requisitions and electronic orders authorized by the provider and printed do not require signature. Reoccurring orders must include both the frequency and duration for the order, not to exceed 1 year. Oregon Laboratory Services will only accept add-on orders to specimens already collected at the written or electronic request of the clinician. These may be submitted in EPIC, by fax (503-215-6127) or by accessing the electronic form, Providence Laboratory Services Oregon Order Formand Authorization. (https://healthplans.providence.org/about-us/Documents/contact-forms/add-on-order- form-and-authorization.htm). Oregon Laboratory Services will not accept verbal orders as a valid order.

Specimen Integrity: In order to assure patient safety and provide accurate results on the correct patient, our laboratory requires that all samples be labeled with two patient identifiers. Please make sure that all samples collected in your office are labeled at the time of collection, in the presence of the patient. Use the patients first and last name as the primary identifier, and then you may use the patients date of birth, chart number, or requisition number as the second identifier. In addition, please include the actual date and time of specimen collection. This information helps you better interpret the results and it helps us monitor specimen quality.

Diagnosis Codes: As the ordering practitioner, you are obligated to provide the signs and symptoms, ICD9 code or descriptive diagnosis that best describes the patients condition and that documents your reason for ordering the test. Using V70.0 or other screening codes is not specific enough to assure insurance coverage for your patients. For you to participate as a Medicare provider, you are required to provide evidence of medical necessity for each order.

National Coverage Decisions (NCDs) and Medical Necessity: The Center for Medicare and Medicaid Services (CMS) developed 23 coverage policies to assure appropriate laboratory utilization. Please see http://www.cms.gov/medicare-coverage-database/indexes/lab-ncd-index.aspx for an alphabetical listing to select the most current on-line version of the coverage rules. Limited coverage tests are identified with an asterisk (*) on our Providence Health and Services Laboratory Requisition. When the ICD9 code you provide does not meet medical necessity requirements, Medicare patients must be advised in advance. Use the CMS approved Advance Beneficiary Notice of Non-Coverage (ABN) to document your discussion. This gives you the opportunity to review the need for the test with the patient, notifies them that they may be responsible for the charges, and provides the patient the option to not have their test(s) or service(s) performed. Because ABNs must include a cost estimate for tests ordered, price lists by region for tests with coverage policies are posted on our laboratory intranet web site at: http://in.providence.org/or/departments/labservices/Pages/Compliance.aspx. Give one completed copy of the ABN to the patient and scan the second page into EPIC or send the original to our laboratory with your orders and specimens.

Non-Covered Services: There has been an increase in requests for testing that Medicare considers non-covered. Often these are kits sent to outside laboratories for tests including genetic markers, BRAC analysis and Prometheus kit tests. Compliant billing requires that the performing laboratory directly bill the patient for all non-covered services. Additionally, these orders often require pre-authorization, your signature as the ordering provider, and a signed patient consent. You are responsible for completing the paperwork required by the testing laboratory. While we may assist in the collection of specimens we are not responsible for shipping, billing, or result delivery. We will ship the kit if the supplies include a pre-paid shipping label.

Pre-Authorization: Many insurance companies require physician pre-authorization (PA) prior to ordering or collecting certain tests, i.e. allergen tests or genetic markers. Please check with the health plan prior to ordering tests on your patients. If the test requires pre-authorization, please include the PA # on the laboratory order to prevent delays in processing. Referral Tests: When tests ordered are not available for analysis within our Laboratories, we forward them to carefully selected referral laboratories. Reference laboratories must meet our criteria for quality and service, and they must be properly accredited for the testing ordered. Reference laboratories must meet all of the rules established by the Clinical Laboratory Improvement Act and by their accrediting agency. We will only send tests to laboratories with which we have an arrangement for service. Through such arrangements we are able to enhance connected care with quicker turn-around-times and interfaced electronic result reporting.

Pap Smear Orders: CMS provides very specific direction for assuring coverage of Pap Smears. Medicare covers screening Pap Smear tests only when ordered with one of these four ICD9 codes: V76.2 (screening, cervix), V15.89 (high risk), V76.47 (screening, vaginal), or V76.49 (screening, other sites). These four codes are pre-printed on our laboratory requisition for your convenient selection. Diagnostic PAPs require a separate ICD9 code provided by you.

PSA Tests: CMS provides even more specific coverage rules for PSA testing. Screening PSAs are covered for Medicare patients only when ordered with ICD9 code V76.44. Medicare patients must always be presented with an ABN when a screening PSA is ordered for any reason other than V76.44. Indicate other appropriate ICD9 codes when ordering diagnostic PSAs.

Panel Tests: Organ or disease related panels are charged and reimbursed only when all test components are medically necessary. All components of panels offered by Providence Laboratories may be ordered individually. Providence Laboratories does not recognize custom panel orders designed by other laboratories. To prevent delays with testing, and to be sure you receive the tests intended, please order using specific test names and numbers as provided in our test directory.

CBC Tests: The AMA (American Medical Association) definition for a CBC (complete blood count) does not include a differential. A CBC order will include the hemogram only. Please specify CBC with diff when you need the differential included. These orders will include an automated or manual differential (as determined by internal criteria).

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Medicare Laboratory Fee Schedule: Medicare publishes the reimbursement fee schedule for 2013on the CMS site, http://www.cms.hhs.gov/ClinicalLabFeeSched/02_clinlab.asp#TopOfPage. The Medicaid reimbursement amount will be equal to or less than the amount of Medicare reimbursement.

Additional Charges: Some laboratory tests may trigger additional automatic orders and appropriate charges based on laboratory policy reflecting best standards of care. Our test directory provides specific information including criteria that will lead to these charges, along with specific CPT codes. The on-line directory is available at: http://www.providence.org/oregon/programs_and_services/lab_services/default.htm. Examples include:

If pathological organisms are present on cultures, additional testing and charges for organism identification and susceptibility testing are applied.

A Positive DAT on cord blood will trigger orders and charges for antibody screening. Body Fluid Cell Counts with WBCs present will reflex to include a differential WBC count. Negative or indeterminate results on rapid Beta Strep tests will be followed up with a throat culture to

screen for group A Strep. Lower respiratory, wound, body fluid, CSF, and genital cultures include Gram Stains.

Reflex Testing: In other cases, defined results will trigger additional testing and charges only when so requested with the initial order. Typically, reflex or if will be included in the test name. Examples include:

Pap Smear, HPV if ASCUS. UA, C & S IF, which will add a urine culture based on results of the urinalysis PSA Reflex, which adds a Free PSA based on results of the PSA Total, Diagnostic. Respiratory Virus Reflex Panel, which consists of up to four PCR tests, and then adds a respiratory virus

culture if all PCR tests are negative.

Supplies: Providence Laboratory Services will provide supplies required for the collection of specimens that are to be sent to our laboratory. Anti-Kickback statutes govern these practices, and our laboratory monitors the volume of supplies provided to your offices. Supply volumes must reasonably match volumes of testing received.

Clinical Consultant: Consultation services regarding appropriateness of testing and interpretation of results is available to you by contacting our Medical Directors at 503.893.7800.

James Durham, MD, Medical Director Regional Laboratories, PWFMC Brook Howard, MD, Medical Director POP 3, PMH, TOC Laboratories Allan Sacker, MD, Medical Director PSVMC Laboratory Jeff Harter, MD, Medical Director PPMC Laboratory, Point of Care Testing June Olson, MD, Medical Director PHRMH Laboratory James Booth, MD, Medical Director PNMC Laboratory Pifu Luo, MD, Medical Director PMMC Laboratory Margret Oethinger, PhD, MD, Medical Director PSH Laboratory Yibin Zhang, MD, Medical Director Marion County Laboratory

We hope you find this information useful in your practice. Please dont hesitate to call 503.215.6555 for further information.

Mary OBrien, MS, MT (ASCP) Regional Operations Manager Providence Laboratory Services Oregon Region