Making Sense of Proprietary Laboratory Analyses (PLA) Codes

Every year more and more are approved – a plethora of PLA codes for laboratories to keep track of and manage. So, what are they and what do you need to know about the latest changes that could cause confusion…or worse? With over 70 new PLA codes effective in the last year alone, it’s time to solidify knowledge and understanding of this murky code set. Let’s take a look and break down some of the basics.

The Emergence

PLA codes were first established by the American Medical Association (AMA) CPT® Editorial Panel as alphanumeric CPT codes that provide corresponding descriptors for laboratories or manufacturers. Why? These entities were seeking a way to more specifically identify their testing. The creation was also a direct answer to the implementation of the Protecting Access to Medicare Act of 2014 (PAMA). In the final rule for PAMA implementation, the Centers for Medicare and Medicaid Services (CMS) established the definition of advanced diagnostic laboratory tests (ADLTs) as tests created and offered by a single lab that use a unique algorithm to analyze multiple DNA, RNA, or protein markers, and which provide new clinical diagnostic information that can’t be obtained by any other test.

Tests assigned to PLA codes must meet specific criteria:

• First, they must be performed on human specimens
• Second, they must be requested by the manufacturer or clinical laboratory that offers the test.

Note: Limiting factors exist which determine what laboratory has the right to use certain PLA codes or the manufacturer-specific lab test they are assigned to, but that is all in the name, “proprietary.”

The Clashing of PLA With Category 1 Codes

If you aren’t yet familiar with it, you should be. As defined by PAMA, the PLA code section was developed to include ADLTs and clinical diagnostic laboratory tests (CDLTs) for procedures based on human gene analysis. Recently, however, the language describing PLA codes is opening the door for the approval of new codes for procedures not limited to human gene-based analysis. With new PLA codes effective for chemistry testing, drug analysis, microbiology and more, welcome to a coding world where certain tests with existing Category 1 CPT codes will also have a manufacturer-specific PLA code. This crossover is sure to create a scenario with high risk for confusion, miscoding and claims denials.

Here are some quick guidelines that may help dodge this tricky situation and secure your confidence navigating PLA codes.

• If a PLA code is available for a given service, that PLA code gains priority over the Category 1 CPT code.
• The service cannot be reported with any other CPT codes, nor can other CPT code(s) be used to report services that would qualify for a specific PLA code.
• PLA codes can be given by either a single “sole source” laboratory or licensed or marketed to multiple providing laboratories, in accordance with the Food and Drug Administration’s (FDA) approval, by a manufacturer for a specific test.
• It is essential to review the full, long descriptions of these codes to determine the associated laboratory or manufacturer.
• The codes are updated quarterly so check the AMA website for updates, which include newly approved codes.

Payer Policies

Unfortunately, it should be noted even with the existence AND correct application of the PLA code, this is not an indication that the code will be covered or separately paid.  When it comes to PLA codes, many commercial payers require prior authorization to assess whether medical indications for the procedure were followed by looking at both the diagnosis and code.

Prior authorization has some further restrictions. Payers specifically state that laboratories are restricted from obtaining clinical authorization on behalf of the ordering physician.  Even more, their policies outline that should a laboratory be found supporting any portion of the authorization process, the payer holds the right of deeming the action a violation of participation.

The financial liabilities that fall under the prior authorization process are similar to that of the Medicare Advance Beneficiary Notice. Should a laboratory service not be authorized but performed, the service shall be denied and considered the financial liability of the laboratory. This means that the cost of testing is not allowed to be passed on to the patient. All and all these are serious consequences that any laboratory should seek to avoid since the uncertainty with PLA won’t be ending anytime soon, if ever…

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