Pennsylvania Medicaid Approves Addition of Key FNA Pathology Codes Following Advocacy Effort

Unpacking the Reimbursement Issue

In a significant reimbursement development for pathologists across Pennsylvania, Lighthouse Lab Services successfully advocated for the addition of CPT codes 88172, 88173, and 88177 to the Pennsylvania Medical Assistance (Medicaid) Program Outpatient Fee Schedule.

These CPT codes describe pathology evaluation services associated with fine needle aspiration (FNA) procedures and play an important role in evaluating specimens and assisting physicians in the diagnosis of cancer and other diseases. Despite the clinical importance of these services, the codes were not included on Pennsylvania Medicaid’s outpatient fee schedule, creating a situation in which pathologists could perform medically necessary services without corresponding reimbursement.

Recognizing the reimbursement gap, RCM Client Manager Christy O’Dell submitted a formal request to the Pennsylvania Department of Human Services (DHS), supported by a detailed letter outlining the clinical importance of the services and the need for appropriate Medicaid coverage and reimbursement.

Following the request, the Department’s Technology Assessment Group (TAG) conducted an internal review of available publications and current clinical literature related to CPT codes:

• 88172
• 88173
• 88177

The Department subsequently notified Lighthouse that all three CPT codes were assigned “Option #1,” meaning the services will be added to the Medical Assistance Program Fee Schedule based on well-established medical evidence.

According to the Department, CPT codes 88172, 88173, and 88177 are tentatively scheduled to be added to the Pennsylvania MA Program Outpatient Fee Schedule as part of the Fall 2026 Fee Schedule Revisions. The changes will be formally announced through a public notice in the Pennsylvania Bulletin and an MA Bulletin containing additional coverage and billing guidance.

Until the codes are officially added to the fee schedule, Pennsylvania Medicaid will continue to consider requests for these services on a case-by-case basis through the 1150 Administrative Waiver Program Exception process when the services are considered medically necessary.

This outcome represents an important advancement for Pennsylvania pathologists and demonstrates the impact that focused payer advocacy can have on reimbursement policy. More importantly, it helps ensure that pathology services used in the evaluation and diagnosis of patients are appropriately recognized by the Medicaid program.

 

Is a payer policy creating recurring reimbursement challenges for your practice? Let’s talk.

Contact Lighthouse today to schedule a complimentary fee schedule review.

 

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