Diagnostic Test Coding and CoverageCPT, PLA, and the Path to Payment

Getting paid for a new diagnostic depends on three separate questions: how the test is coded, whether payers cover it, and what they pay. Each has its own process and timeline.

Coding: describing the test

  • • CPT codes describe a service; some tests fit existing codes, others need new ones.
  • • PLA (Proprietary Laboratory Analyses) codes identify a specific lab's or manufacturer's test.
  • • Unlisted or miscellaneous codes may be used initially but often slow payment.

Coverage: will payers pay at all

  • • Medicare coverage can come through national or local coverage determinations.
  • • Many molecular tests are evaluated through the MolDX program for applicable jurisdictions.
  • • Commercial payers set their own medical policies, often referencing guidelines and technology assessments.

Payment: how much

Pricing for new lab tests is set through established Medicare processes, and commercial rates are negotiated or follow payer fee schedules. Payment levels shape unit economics and should inform go-to-market decisions early.

Planning ahead

  • • Assess coding options before launch, not after first claims are denied.
  • • Build a coverage dossier around clinical utility evidence.
  • • Model revenue under realistic coverage scenarios, including partial coverage.

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