Laboratories performing polymerase chain reaction (PCR)-based diagnostic testing continue to face significant billing and reimbursement challenges, particularly in regions covered by the Molecular Diagnostic Services Program (MolDx). As labs operating in these areas know well, the challenges are further compounded by inconsistent payer guidance, conflicting coding recommendations, and the absence of Z-Codes for common panels like UTI, STI, and respiratory panels.
At Lighthouse Lab Services, our Revenue Cycle Management (RCM) team helps labs navigate and stay on top of the ever-changing environment for molecular testing. In response to the many questions raised during our May 28, 2025, webinar on billing for PCR tests in MolDx jurisdictions and navigating related payer issues, we’ve compiled a handful of the most pressing issues and provided direct guidance below.
- For more information on MolDx and Z-Codes, check out our explainer here!
Understanding the CPT Code Discrepancy
A common pain point is the disconnect between AMA coding guidance and CMS reimbursement policy. The AMA supports unbundling panel tests using CPT codes like 87150 and 87798 for each organism tested, since each produces a separate result. However, CMS is increasingly enforcing the use of CPT 87801 for panels run in a single pass, even when multiple results are reported, because they consider the use of one test kit as a single test.
The problem: CPT 87801 typically reimburses at ~$75, which is often well below the actual cost of running high-complexity panels. Labs billing according to AMA guidance may face denials or audits under CMS’s more restrictive interpretation.
Key takeaway: Even though AMA supports unbundled codes, CMS is enforcing bundled billing via 87801, leading labs to absorb financial losses unless policy shifts or new codes are introduced.
________________________________________
Z-Codes: Requirements, Limitations, and Compliant Approaches
Another core issue is the lack of available Z-Codes for many common PCR panels. Z-Codes are required for billing in MolDx jurisdictions and increasingly demanded by UnitedHealthcare (UHC), Humana, and Optum, even outside of MolDx regions.
Key points:
- UTI, RPP, wound, and fungal panels with 15+ targets in California or other MolDx states must have a Z-Code or will likely be denied.
- Labs outside MolDx jurisdictions (e.g., Connecticut under NGS) can (and often must) still register with DEX™ to obtain a Z-Code for reimbursement from UHC or Humana.
- Even with registration, providers are struggling to obtain Z-Codes for high-target PCR panels, making reimbursement inconsistent and unpredictable.
________________________________________
Billing Challenges Across Payers
Many payers are starting to mirror CMS/MolDx policies, leading to new hurdles:
- UHC and Humana are bundling codes and requiring a single CPT (often 87801), resulting in reduced payments.
- Some labs have successfully received payment from these payers when using 87801, but not at rates that match their testing costs.
- Use of 87999 has been explored, but it typically applies only under MolDx LCDs and not for labs under other MACs like NGS.
________________________________________
Common Denial Management Scenarios and Appeals
Laboratories frequently face denials due to:
- Billing duplicates of 87798 or 87481, which some payers expect to be reported as a single bundled code.
- Missing or incorrect Z-Code registration.
- Misalignment with payer guidelines that differ from CLIA, AMA, or CMS instructions.
Appealing these denials often involves pointing to CPT definitions and clinical utility literature, but results vary by payer. If you would like to review your RCM denial management strategy further, there are a number of new automated and AI-assisted tools that can greatly improve results in this area when paired with expert guidance.
________________________________________
What About the Future of MolDx Expansion?
While there’s no formal announcement about additional MACs joining the MolDx program, industry trends indicate that commercial payers are increasingly adopting MolDx-like requirements. This suggests the landscape will continue shifting toward centralized policies, making proactive compliance and denial management even more important.
________________________________________
Medicare Advantage vs. Commercial Plans: Which Rules Apply?
Confusion also exists around whether Medicare Advantage plans follow Medicare or commercial plan rules.
Here’s what labs need to know:
- UHC, Humana, and Optum Care Medicare Advantage plans currently require Z-Codes.
- Other MA plans do not currently require Z-Codes, but that could change as policy adoption spreads.
Stay up to date by regularly checking DEX Z-Code Lookup and your MAC’s local coverage determinations.
________________________________________
A Path Forward: What Labs Can Do Today
Until CMS or commercial payers update reimbursement policy or issue new panel codes, labs should:
- Register all molecular tests through DEX where applicable, regardless of MAC jurisdiction.
- Document the individual results provided for each organism tested to support unbundled coding.
- Engage in proactive appeals where appropriate, using AMA guidance and clinical data.
- Consult with experts to minimize the risk of audits or denials.
Our team at Lighthouse is also working to support new clinical studies and technical assessments with the goal of developing new CPT panel codes and corresponding LCDs to reflect today’s molecular testing practices.
________________________________________
Need Help Navigating PCR Billing and Compliance?
Our RCM Solutions team works with labs across the country to ensure appropriate coding, Z-Code registration, and payer communication. If you’re struggling with denials, underpayment, or compliance issues, we can help assess your options and pursue a strategy aligned with your lab’s goals.
Contact us today to schedule a complimentary consultation with our RCM experts.
