Blue Review
A newsletter for physician, professional, facility, ancillary and Medicaid providers

November 2017

Review Documentation Guidelines for Laboratory Audit and Review

To assist in prompt payment of claims and to insure payment integrity, Blue Cross and Blue Shield of Texas (BCBSTX) requires laboratory services to be properly documented. Incomplete or illegible records can result in a denial of payment for services.

Submit Justification of Services
For a claim to process and for BCBSTX benefits to be valid, there must be sufficient documentation in the provider's or hospital's records to verify that the services performed were medically necessary and required the level of care billed. If there is insufficient or no documentation, then there is no justification for the services or level of care billed, and request for payment may be denied. Additionally, if there is insufficient documentation for the claims that have already been adjudicated by BCBSTX, reimbursement may be considered an overpayment and the funds may be recovered.

Laboratory claims should be submitted to the state Blue Cross and Blue Shield Plan where the sample was obtained regardless of where the testing facility resides.

Each laboratory claim should have valid laboratory medical records documenting the services ordered and the results of the services performed. Laboratory medical records consist of a signed valid requisition and complete results of the tests performed. A valid requisition is one received from the patient’s treating physician or qualified health care provider (i.e., the provider treating the patient and who will use the test results in the management of the patient’s specific medical problem). Records should be complete, legible and include the following on the requisition:

  • Complete patient identification
  • Complete ordering provider identification (minimum full name and NPI#)
  • Signature of ordering physician (must be legible) (signature on file, signature stamp and photocopies of signature are not acceptable)
  • Facility and location where sample collected (state, office, home, hospital, residential treatment center)
  • Type of sample (e.g., blood, serum, urine, oral swab)
  • Date and time collected
  • Date and time received in the lab
  • Identity of individual who collected sample
  • For urine testing, a temperature at time of collection may be relevant and aid in validity
  • ICD-10-CM diagnosis codes received from ordering provider (specificity required)
  • Identify specific tests ordered (avoid “custom” panels)
  • For drug testing, a current medication list and point-of-care test results may be relevant and aid in supporting medical necessity.

BCBSTX follows the Centers for Medicare & Medicaid Services guidelines. Medicare will only pay for tests that are medically reasonable and necessary based on the clinical condition of each individual patient. Confirmation of drug screening is only indicated when the result of the drug screen is different than suggested by the patient’s medical history, clinical presentation or the patient’s own statement. Medicare makes this statement to reinforce that the ordering provider is cautioned that the justification for the need for testing is required.

Laboratory results documentation must include:

  • Complete identification of performing entity (name, address, CLIA#)
  • Patient name and DOB
  • Ordering provider name and NPI#
  • Facility name if applicable
  • Date sample collected
  • Date sample received in lab
  • Date test results reported
  • Complete test results, including validity testing if performed

Although BCBSTX does not require a laboratory provider to recover and submit medical records from an ordering provider, the burden of proof remains with the billing provider to be able to substantiate the medical necessity of the laboratory services billed. If necessary, BCBSTX will request records from an ordering provider to provide supporting information during a laboratory claim audit/review. Insufficient or a lack of supporting information will result in denial of the laboratory claim. Review an example of BCBSTX’s Urine Drug Testing Policy MED207.154.

Medicare auditors similarly require a billing provider to assume responsibility for obtaining supporting documentation as needed from a referring physician’s office.* The ordering provider’s medical record must support the medical necessity for each service ordered. The record must be specific to an individual patient and not consist of “standing, routine or orders per protocol.” Such one-size-fits-all ordering will not support the necessity for testing and may result in a payment denial for the laboratory service.

Familiarity with health care plan medical policies regarding laboratory testing may prevent unexpected claim denials. Orders alone do not ensure reimbursement. Medical policies, benefits, eligibility and medical record documentation are the determining factors for reimbursement.

Laboratories should be mindful of requests for testing received from inpatient and intensive outpatient behavioral health facilities. This is because laboratory services are included in per diem rates paid to the entities and should not be unbundled and submitted for separate claim reimbursement. In those instances, separate reimbursement for laboratory services may be denied or disallowed because payment is included in the ordering provider’s per diem payment.

Health plan medical policies, and Medicare local and national coverage documents can be found online by searching BCBSTX’s website or Medicare’s public website. Individual benefit/coverage information can be found by calling Customer Service at the number listed on the back of a member’s BCBSTX ID card.

*Medicare Program Integrity Manual (Pub. 100-08), Chapter 3, Section 3.2.3.