[Author: Will Mavity]

On December 19, 2022, OIG released its annual report analyzing Medicare Part B spending on laboratory tests over the past year. According to OIG, Medicare Part B spending on laboratory tests increased 17% from $8.0 billion in 2020 to $9.3 billion in 2021. This constitutes the largest one-year increase in Medicare spending on laboratory testing since OIG began monitoring Medicare laboratory test payments in 2014.

According to OIG, spending on chemistry tests remained the highest portion of Medicare laboratory test payments, at $2.1 billion. Chemistry tests measure amounts of proteins, electrolytes and hormones in samples and are used to analyze organ function and overall health. Although the total volume of chemistry tests in 2021 increased from 2020, according to the OIG, it was still lower than in pre-pandemic years, indicating that people have yet to completely return to pre-pandemic behavior in terms of routine medical appointments and testing.

OIG also reports that COVID tests constituted a huge portion of total spending as well, at $2.0 billion. Based on OIG’s data, more than 10 million Medicare enrollees received at least one COVID test paid for by Medicare Part B in 2021. This COVID test spending included, among other categories, panel tests, antibody tests, and tests billed under a new code (U0005) introduced in 2021 that allows for additional payment from CMS in return for faster test turnaround times.

Spending on genetic tests also increased in 2021 to $1.9 billion. OIG reports that genetic testing spending has continued to increase since it began monitoring laboratory test payments in 2014.

OIG performs this review of the top 25 laboratory tests annually as required by the Protecting Access to Medicare Act of 2014 (PAMA). Its results were largely based on claims data for laboratory tests in 2021 paid for by CMS under the Clinical Laboratory Fee Schedule (CLFS).

The full report can be found here.