MDHHS follows Medicare’s current OPPS coverage policies as closely as possible and appropriate. In those instances where program differences require coverage disparity, the differences will be reflected through the application of the MDHHS specific status indicator. Procedure codes associated with the identified services will appear on the MDHHS OPPS Wraparound Code List available on the MDHHS website. (Refer to the Directory Appendix for website information.)

MDHHS policy covers hospitals for medically necessary laboratory tests when:

* Performed in a laboratory certified by the Clinical Laboratory Improvement Amendments (CLIA);

* Needed to diagnose a specific condition, illness, or injury; and

* Ordered by physicians (MD or DO), podiatrists, dentists, nurse practitioners, or nurse-midwives.

MDHHS requires medical record documentation of medical necessity. An explanation of the laboratory testing method or the results of diagnostic tests, whether normal or abnormal, is not considered documentation of medical necessity. For approval of payment, the laboratory procedure(s) must be specific and appropriate to the beneficiary’s documented condition and diagnosis.

Reimbursement to the inpatient hospital is through the DRG payment. Reimbursement for outpatient services is billed using the appropriate HCPCS code and includes the collection of the specimen(s), the analysis, and the lab test results. MDHHS performs pre- and/or postpayment reviews to monitor laboratory procedures for medical necessity and appropriate practitioner
orders. Outpatient hospitals are subject to corrective action, including the recovery of funds, for laboratory services not specifically ordered by a practitioner.

MDHHS does not cover:

* Screening or routine laboratory testing, except as specified for EPSDT Program or by Medicaid policy;

* “Profiles”, “batteries” or “panels” of tests that include tests not necessary for the diagnosis or treatment of the beneficiary’s specific condition; or

* Multiple laboratory tests performed as a part of the beneficiary evaluation if the history and physical examination do not suggest the need for the tests.

Services performed by an outpatient hospital laboratory or its employees may not be billed to, or by, the ordering practitioner.


The obstetric profile must be ordered by the attending practitioner and billed as an allinclusive panel of tests for required prenatal laboratory services. It must include the following:

* Blood count, complete (CBC), automated and automated differential WBC count, or Blood count, complete (CBC), automated and appropriate manual differential WBC count

* Hepatitis B surface antigen (HBaAg)

* Antibody, rubella

* Syphilis test, qualitative (e.g., VDRL, RPR, ART)

* Antibody screen, RBC, each serum technique

* Blood typing, ABO

* Blood typing, Rh(D)

Only AMA-approved organ- or disease-oriented panels may be billed. All tests within the panel must be medically necessary. Unless the complete panel is ordered and performed, bill as individual tests.

Testing for HIV is covered separately when determined to be medically necessary and ordered by the practitioner.

Only practitioners should order the serum or urine HCG qualitative method when the beneficiary requires preliminary pregnancy testing.

Nurse-midwives may order only the laboratory tests listed below. Hospitals are not reimbursed for any other tests ordered by a nurse-midwife.

* Acetone and diabetic acid (ketone bodies); qualitative; semi-quantitative

* Albumin; qualitative, semi-quantitative, quantitative (such as Esbach)

* Antibody titer Rh system; albumin, saline and/or AHG technique

* Blood count; RBC, WBC, Hemoglobin, Hematocrit, indices (MCV, MCH, MCHC)

* Blood typing; ABO, Rh(D), RBC antibody screening

* Culture, presumptive (screening), for Neisseria gonorrhea, Candida, Hemophilus, or beta hemolytic Streptococcus group A, etc.

* Culture, urine, definitive; with or without colony count

* Cytopathology, vaginal and/or cervical smears (e.g., Papanicolaou type) screening (cytopathological examination for malignancy, microbial flora, inflammatory features and hormonal evaluation)

* Glucose; qualitative, quantitative, timed specimen, tolerance

* Hemoglobin, electrophoretic separation; qualitative

* Hepatitis B test

* Human immunodeficiency virus detection

* Pregnancy test

* Prenatal laboratory services; routine (Obstetric panel)

* Quantitative sediment analysis and quantitative protein (Addis count); 12- or 24-hour specimen Reticulocyte count, manual

* Rubella test; titer

* Sickle cell slide test

* Skin test, tuberculosis, tine test

* Susceptibility (sensitivity) for aerobes by Kirby-Bauer procedure for specific pathogens, using 10-12 discs per pathogen; also for susceptibility (sensitivity) for anaerobes by generally accepted standard techniques using 5-12 discs per pathogen (specify number of pathogens)

* Syphilis testing, flocculation or precipitin (VDRL, RPR, etc.); qualitative

* Trepanema antibodies, fluorescent, absorbed (FTA-abs)

* Urinalysis, complete (physical appearance, pH, specific gravity, microscopic examination, qualitative chemistry with or without semi-quantitative confirmation)

* Wet mount, smear, tissue; direct microscopic examination


MDHHS reimburses for blood handling only when a beneficiary is referred to an outpatient hospital for the sole purpose of drawing, packaging and mailing a blood sample to MDHHS for HIV-1 viral load analysis and/or CD4/CD8 enumeration. The State provides specimen containers and mailin  kits for the analysis. (Requests for supplies and samples for analysis should be sent to the MDHHS Blood Lead Laboratory. Refer to the Directory Appendix for contact information.)


A complete blood count (CBC) with white blood cell (WBC) differential includes the RBC and WBC count, Hgb, Hct, MCH, MCHC, MCV, RBC morphology, platelet estimate, and WBC differential only. If automated instrumentation yields additional test parameters, the results are not reimbursable unless medically necessary and specifically ordered by a practitioner.


MDHHS coverage and reimbursement for gram fluorescent/acid fast is included in the reimbursement for microbiology when performed on the same DOS for the same beneficiary.


Pap smear screening by a technologist under the supervision of a pathologist is a covered service. If a suspect smear requires additional interpretation by a pathologist, this service is also covered. Only one Papanicolaou test within a 12-month period is covered for each beneficiary, unless medical necessity or history of abnormal findings requires additional studies.


For direct-billed laboratory services ordered by an approved CA, the referring provider NPI number must be appropriately reported on the appropriate paper or electronic claim format.


Calculate and report the Glomerular Filtration Rate (eGFR) for tests processed for beneficiaries in outpatient settings and for beneficiaries 18 years of age and older. The eGFR test results must report two values on the lab report for beneficiaries: one for American and one for non-African-American, or one value if race is available and able to be used in calculating the value.


[Alternative – Non-Traditional Laboratory Testing]

Live Blood Cell Analysis (LBA) is a test which is used for the purpose of providing information for the diagnosis, prevention, or treatment of any disease or impairment of, or assessment of the health of human beings. LBA is also known as Hemaview, Free Radical Blood Screening, or Nutritional Blood Analysis. LBA is not a Provider-Performed Microscopic Procedure (PPMP) test. It is also a non-covered Medicare service.

In January 1996, the Centers for Disease Control (CDC), determined that the LBA test procedure automatically defaulted to high complexity because it had not been categorized by CDC. In addition, the Centers for Medicare & Medicaid Services (previously the Health Care Financing Administration) Office of General Counsel (OGC) determined in August 1997, that LBA was subject to all CLIA requirements for high complexity testing1 (i.e. patient test management, proficiency testing, quality control, personnel and quality assurance). Therefore, any facility performing this procedure must be certified by CLIA and hold a valid registration certificate,Certificate of Compliance, or Certificate of Accreditation. Failure to comply with any of the CLIA requirements will result in enforcement actions and/or sanctions being taken.

LBA is performed by placing a drop of blood from the patient’s fingertip on a microscope slide under a glass coverslip to keep it from drying. In some cases, a powder has been developed that, when sprinkled on the blood, forms a type of “coverslip”. The slide is then viewed at high magnification with a dark-field microscope that forwards the image to a television monitor. The results are then used for prescribing nutritional supplements.

Other examples of Alternative Testing (Non-Traditional Laboratory Testing) that are subject to CLIA:
1. Biological Terrain Assessment (BTA): BTA is a computerized analysis of blood, urine, and saliva specimens used to recommend nutritional programs, vitamin and mineral supplements, homeopathic products, and/or herbs. Analysis is determined through pH determinations which are the portion of the test that is legitimate.

2. Thromboelastograph: This is a valid test which has been categorized by the CDC as either moderate or high complexity, depending on whether the instrument prints the test results. The test is performed by a perfusionist in the operating room or sometimes in blood gas laboratories.

3. Dental sensitivity testing: This test determines whether a person is sensitive to materials in fillings. If sensitive, all fillings can be removed and replaced. All reviewing agencies could not determine whether the method was valid.

4. Cytotoxic Testing (Food Allergy Testing); also called Brian’s Test or Leukocyte Antigen Testing: Cytotoxic testing involves taking about 10 cc of blood from a patient. Microscopic slides are coated with the dried extract of a particular food. White blood cells (WBCs/leukocytes) are then mixed with plasma and sterile water and placed on the coated microscopic slides. The reaction of the cells to the extracts is then examined under a microscope. If the cells collapse, disintegrate, or change shape, the patient is supposedly allergic to that particular food. This evidence of food allergy is then used to explain a variety of symptoms. To correct this condition, the clinic offers a personalized diet program which includes vitamin and mineral supplements.

Laboratory Registry

Once a year the Centers for Medicare & Medicaid Services (CMS) makes available to physicians and to the general public specific information (including information provided to CMS by the Office of the Inspector General) that is useful in evaluating the performance of laboratories. The Clinical Laboratory Improvement Amendments of 1988 (CLIA) and implementing regulations at 42 CFR 493.1850 require that this listing include the following:

A list of laboratories that have been convicted, under Federal or State laws relating to fraud and abuse, false billing, or kickbacks.

A list of laboratories that have had their CLIA certificates suspended, limited, or revoked, and the reasons for the adverse actions.

A list of persons who have been convicted of violating CLIA requirements, as specified in section 353(1) of the Public Health Service Act (PHS Act), together with circumstances of each case and the penalties imposed.

A list of laboratories on which alternative sanctions have been imposed, showing—
    the effective date of the sanctions;
    the reason for imposing them;
    any corrective action taken by the laboratory;
    if the laboratory has achieved compliance, the verified date of compliance.

A list of laboratories whose accreditation has been withdrawn or revoked and the reasons for the withdrawal or revocation.
All appeals and hearing decisions.
A list of laboratories against which CMS has brought suit under Section 493.1846 and the reasons for those actions.
A list of laboratories that have been excluded from participation in Medicare or Medicaid and the reasons for exclusion.
Civil settlements reached with clinical laboratories are also noted.

The Laboratory Registry is compiled for the calendar year preceding the date the information is made available and also contains corrections of any erroneous statements of information that appeared in the previous registry. A final section includes other specific information that may be useful in evaluating the performance of laboratories, as specified in 42 CFR 493.1850(a). It also includes information provided by CLIA exempt states.