Consumer / Employer, Payers

OIG: Medicare Part B Spending on Lab Tests Rose 17% in 2021

The 17% increase is the largest jump since OIG began tracking lab spending in 2014. This increase was due to higher volume for three test types: Covid-19 tests, genetic tests and chemistry tests.

Medicare Part B spent $9.3 billion on laboratory tests in 2021, a recent report from the Office of Inspector General (OIG) found. This represents a 17% increase from 2020, when spending was at $8 billion.

The OIG conducted this study by analyzing claims data for lab tests performed in 2021 and paid for by the Centers for Medicare and Medicaid Services under the Clinical Laboratory Fee Schedule.

The 17% increase is the largest jump since OIG began tracking lab spending in 2014. This increase was due to higher volume for three test types: Covid-19 tests, genetic tests and chemistry tests.

Medicare Part B spent $2 billion on Covid-19 tests in 2021, a 29% increase from 2020. More than 10 million enrollees received at least one Covid-19 test that Medicare Part B paid for.

“The Covid-19 pandemic continued to have an impact on Medicare Part B spending on lab tests,” the report said. “Spending on Covid-19 tests increased in 2021, driven by more people receiving more tests.”

This rise in spending on Covid-19 tests may not have continued into 2022, however.

“Looking to 2022, it is likely that the increased availability of at-home Covid-19 tests could affect overall Medicare Part B spending for lab-performed tests,” OIG said.

Additionally, spending on four types of genetic tests rose by 56% to $1.9 billion in 2021, compared to $1.2 billion in 2020. This exceeded even pre-pandemic levels: in 2019, spending on genetic tests was $1.5 billion.

Spending on chemistry tests also increased. In 2021, Medicare Part B spent $2.1 billion on chemistry tests, a nearly 11% increase from 2020 at $1.9 billion. However, this is below pre-pandemic levels. In 2019, Medicare Part B spent $2.4 billion on chemistry tests. This has some concerning implications, OIG said.

“The second year in a row of low volume for chemistry tests raises questions about the pandemic’s long-term impact on Medicare enrollee health,” the report stated. “Although volume increased from 2020 to 2021, it did not fully return to pre-pandemic levels, which could indicate that people are not seeking the routine or preventive care appointments where these tests are ordered. Research suggests that delays of such tests could have a long-lasting impact on people’s health.” 

The top 25 tests cost Medicare Part B $5.5 billion, or 59% of Medicare Part B’s total spending on lab tests in 2021, the report found.

Photo: Julia_Sudnitskaya, Getty Images

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