Genomic Lab Billing 101

Why Genomic Lab Billing Matters

Genomic testing is a cornerstone of personalized medicine. From non-invasive prenatal testing (NIPT) to hereditary cancer risk panels and pharmacogenomic analysis, genomic diagnostics offer actionable insights that shape patient care. However, billing for these complex tests is anything but straightforward.

Genomic lab billing requires an expert understanding of unique coding structures, payer coverage policies, and ever-evolving compliance standards. Labs that fail to master this domain risk massive reimbursement losses, high denial rates, and payer audits. That’s where Phytest comes in.

At Phytest, we specialize in genomic lab billing. We help laboratories navigate payer requirements, optimize reimbursement, and stay compliant in a rapidly evolving landscape. Our expert team understands the nuances of CPT/PLA coding, prior authorization, documentation, and payer-specific policies, so your lab can focus on clinical excellence while we handle the financial complexity.

What Is Genomic Lab Testing? Key Differences from Molecular Lab Testing

While often grouped together, genomic and molecular testing are distinct in scope, clinical application, and billing strategy.

Genomic testing refers to the analysis of the entirety or large segments of a genome. This includes:

• Whole exome or genome sequencing
• Multi-gene panels for hereditary cancer or cardiac risk
• Pharmacogenomics (PGx)
• Carrier screening and prenatal testing (e.g., NIPT)

These tests often involve comprehensive panels and interpretive analysis, and may use tiered CPT codes like 81445, 81450, and 81455 or unlisted codes like 81479. Genomic testing usually requires extensive documentation, including clinical notes, family history, and sometimes genetic counseling reports.

Molecular testing, on the other hand, is typically more targeted. It involves detecting specific sequences in DNA or RNA to identify infections, mutations, or disease markers. Examples include:

• COVID-19 and other infectious disease PCR tests
• Oncology biomarkers like BRAF or EGFR
• Pathogen detection panels

Molecular tests generally use Molecular Pathology Tier 1 and Tier 2 CPT codes (e.g., 81206, 81210, 81345) and have different documentation and prior authorization requirements.

According to the National Human Genome Research Institute, genomics encompasses a broader study of all genes and their interactions, while molecular biology typically focuses on the structure and function of individual molecules like DNA and RNA. This distinction is critical from a reimbursement perspective, as genomic tests often require more comprehensive coding strategies and face stricter scrutiny from payers.

Billing for genomic tests also involves unique challenges like PLA (Proprietary Laboratory Analysis) codes. The American Medical Association updates PLA codes quarterly, and misusing them can lead to denials or recoupments [2].

Challenges in Genomic Lab Billing and Reimbursement

Genomic testing brings substantial clinical value—but only if labs are reimbursed appropriately. Unfortunately, billing for these services is rife with obstacles.

Prior Authorization Complexity

Many payers require prior authorization for genomic tests. Aetna, for example, mandates documentation of genetic counseling and detailed clinical justification before authorizing hereditary cancer panels. UnitedHealthcare’s Genetic Testing Policy outlines similar requirements, particularly for NIPT, pharmacogenomics, and large gene panels.

Failure to secure pre-authorization results in automatic denials. Worse, some payers may retroactively review paid claims and issue takebacks if documentation is inadequate.

High Denial Rates

A 2023 report from Concert Genetics found that 35% of genetic testing claims were initially denied by payers. Top denial reasons included:

• Missing medical necessity documentation
• Invalid CPT or PLA code usage
• Submitting genomic panels under bundled codes without supporting evidence

These denials represent not only lost revenue but also costly rework by billing teams and delayed cash flow.

Policy Variability Across Payers

Payer coverage for genomic tests varies widely. Medicare, through regional MACs like Palmetto GBA, only covers NIPT for pregnancies classified as high risk, as detailed in Local Coverage Determination (LCD) L37688. Commercial payers may restrict coverage to specific conditions (e.g., BRCA1/2 testing for breast cancer) and deny broader panels as experimental.

Coding Complexity

The use of unlisted codes like 81479 is common in genomic billing. Unfortunately, unlisted codes often trigger manual reviews and require detailed documentation to justify reimbursement. Inappropriate use can stall payment for weeks or months.

Payers also expect labs to use PLA codes when available. For example, using 81479 instead of a test-specific PLA code like 0202U (BRCA1/2 and PALB2 analysis) may result in rejection or reduced reimbursement.

Understanding Genomic Lab Revenue Cycle Management Services

While this article focuses on genomics, it’s important to recognize how molecular lab revenue cycle management services (RCM) support accurate and timely billing for both genomic and molecular workflows.

Key RCM components include:

• Pre-bill processes: Verification of benefits, capturing prior authorization, and validating documentation
• Billing: Accurate code selection (including modifiers), avoidance of bundling errors, and application of payer-specific edits
• Post-bill management: Denial tracking, appeal submission, secondary claims, and patient billing

A good RCM partner will also monitor trends in denials and proactively adjust coding or documentation practices to minimize disruption.

How Genomic Lab Billing Services Optimize Financial Performance

Dedicated genomic lab billing services improve reimbursement and operational efficiency in multiple ways:

• Higher collection rates: When documentation and coding align with payer policies, labs receive more accurate payments faster.
• Fewer denials and appeals: Expert coding and policy knowledge prevent common claim rejections.
• Scalable operations: Genomic billing teams can support lab growth—from a few hundred samples per month to thousands.
• Audit protection: Proper use of PLA codes and documentation minimizes audit risk from CMS and commercial payers.

Laboratories that invest in specialized genomic billing partners often see 15–30% increases in net collections compared to those using general medical billing services.

Why Traditional Medical Billing Companies Fall Short

Most traditional billing companies lack experience in genetic and genomic testing. As a result, they:

• Use incorrect or outdated CPT codes
• Submit incomplete documentation packages
• Miss prior authorization deadlines
• Lack expertise in payer-specific genomic billing policies

The outcome? Higher denial rates, underpayments, and even payer audits.

For example, failing to include genetic counseling notes with BRCA test claims can result in denial—even if the testing was medically necessary. Similarly, bundling a 25-gene cancer panel under 81479 without justification will likely trigger a post-payment review.

Phytest Is the Right Partner for Genomic Lab Billing

At Phytest, we understand the unique challenges that come with genomic testing and reimbursement. From complex coding scenarios and documentation audits to payer policy shifts, genomic billing demands a specialized approach—and we deliver.

Our team of experts handles the entire revenue cycle, from pre-bill documentation checks and prior authorizations to accurate CPT/PLA coding, timely submissions, and aggressive denial management. We integrate seamlessly with your lab’s workflow and LIS systems, enabling your staff to focus on patient care while we secure every dollar you’ve earned.

If your lab is billing for genetic or genomic testing and struggling with denials, underpayments, or audit risk, we can help. Let Phytest be your partner in building a sustainable, scalable, and compliant genomic revenue cycle management.

If you’re ready to maximize your genomic testing revenue while reducing billing headaches, contact Phytest today for a free consultation.