• Ronald Chapman, LL.M.

Provider Education: Avoiding Regulatory Hurdles in your Urine Drug Testing Program



In the current health care regulatory environment, testing of patients is an essential part of health care – especially pain management. Providers need to ensure, before providing powerful medications to their patients, that their patients are free of substances that may conflict or be independently harmful to the patient during their opioid or pain management treatment regime. Providers must ensure that patients are not abusing illicit drugs or other prescribed medication. Providers must also ensure that patients are taking their medication and not diverting.


However, urine drug testing "UDT" has placed thousands of providers in the cross-hairs of the federal government. Prosecutors have indicted doctors under drug trafficking laws for failing to take action after seeing sings of diversion (i.e. negative result or positive for illicit opiates). Prosecutors have also indicted physicians, labs, and clinics for administering too many results or testing for too many different substances. So called "custom provider panels" have gotten a lot of physicians in trouble with federal regulators because they are too expensive and sometimes unnecessary. Physicians who prescribe controlled substances must have a comprehensive urine drug testing policy that stratifies risk across your patient population and is appropriately monitored to ensure proper utilization for medical decision making.

Are you already in legal jeopardy? Read this before considering a plea of guilty to a healthcare offense.


Urine Drug Testing Guidelines


The urine drug test has become a required feature of any pain management practice but if not used properly, can be a vehicle for federal investigation or indictment.


Providers should keep these simple rules in mind when testing and analyzing the results:


  • Test every patient who receives controlled substances randomly

  • Patients with zero risk may be tested once every six months according to the CDC

  • Testing intervals must be increased with risk

  • Document creatinine and temperature abnormalities

  • Thoroughly review results and document aberrant behaviors

  • Have a conversation with patients about unexpected results

  • Understand common signs of pseudo-addiction (i.e. stockpiling, overuse)

  • Only discharge when diversion is present

  • Consider an addiction referral instead of discharge when signs of addiction are present

  • Test only for substances that the patient is at risk of using

  • Look out for signs of scraping (i.e. putting drugs directly in sample)


When UDT results are inconsistent or abnormal you must have an honest conversation with your patient about the reason. Inconsistencies are not always signs of diversion. For instance, if the prescribed drug is not detected this could be an indication that the patient is not taking it but it could also be an indication of hoarding, binge use, or rapid metabolism - which could all be signs to increase the dosage. If an un-prescribed drug is detected, thsi could be a sign of diversion but also cold be a sign of supplemental pain relief.

Want to know how you should respond to inconsistent results? Read this helpful article: Recommendations for Urine Drug Monitoring as a Component of Opioid Therapy in the Treatment of Chronic Pain. Peppin et. al. Pain Medicine 2012; 13: 886-896.


Reimbursement for Testing: CMS Regulations Regarding Drug Testing


When a healthcare provider[1] wishes to test a patient the provider orders a test and uses a diagnostic code, generally an ICD-10 code on a test requisition form to indicate the medical condition of the patient in justification for the test. The provider is also required to list the specific items tested for on a specific requisition form. The testing requested should generally correlate with the appropriate diagnosis code. The lab is responsible for ensuring that the diagnosis code on the requisition form justifies the test, this is because it is the lab that ultimately bills for the test. Each time a lab submits a test it certifies that the test is for a medically indicated and necessary reason.[2] While many labs believe they are not held responsible for a physician’s inappropriate tests, this is not the case, if the diagnosis code does not match the panel of testing ordered, the lab may be liable for submitting a false claim.


Urine drug testing (UDT) in patients taking opioid medications “provide valuable and objective information that may assist the clinician in working through the differential diagnoses.”[3] In a pain management setting, random UDTs should be conducted to prevent patients from anticipating the test and “plan[ning] procedures to defeat the reliability of the tests.”[4] However, the frequency of the tests should be based off of the practitioner’s risk assessment of the patient and with the use of a “validated risk-assessment instrument.”[5]

Medicare regulations require providers and suppliers to certify that they meet the requirements of the Medicare statute and regulations. 42 C.F.R. § 424.516(a)(1). In addition, an official must sign a CMS-855B which states that the supplier will follow all of the laws, regulations, and program instructions of the Medicare program. This includes regulations regarding the medical necessity of drug testing. In order to bill Medicare, drug testing laboratories must also meet the requirements of the Clinical Laboratory Improvement Amendments of 1988 (“CLIA”) as codified in 42 C.F.R. Part 493. Labs are able to become CLIA certified if they can show that they meet CLIA’s requirements. In some instances, physicians can preform “CLIA waived” testing which is comprised of in office testing of sample cups that is not subject to CLIA’s requirements.


In order to be reimbursed for diagnostic laboratory tests, the tests must be “reasonable and necessary.”[6] This standard has been applied to urine drug testing through United States ex rel. Hobbs v. MedQuest Assocs., Inc.,.[7] Each test must be reasonable and necessary for the diagnosis or treatment of an individual patient’s illness or injury based on his or her medical condition.[8] A urine drug test (“UDT”) is considered reasonable and necessary when a patient presents with: (1) active treatment for substance abuse or dependence; (2) patients in chronic opioid therapy, if non-compliance or non-adherence to a program is suspected and documented, and/or there is a high risk for medication abuse due to psychiatric issues, aberrant drug-related behavior, or a history of substance abuse; or (3) for patients with chronic pain to determine if there are other substances in the patient’s system prior to starting treatment, detect illicit drugs, ensure adherence to a treatment plan.[9] Furthermore, drug testing is “reasonable and necessary” when an overdose is suspected and the patient: (1) is in an unexplained coma; (2) has an altered mental status; (3) has severe or unexplained cardiovascular instability; (4) has unexplained metabolic or respiratory acidosis; (5) is being testing on neonates suspected of prenatal drug exposure; or (6) has seizures with an undetermined history. Id.


A physician may use two methods of measuring the presence of illicit drugs, non-prescribed prescription drugs, and alcohol: immunoassay (qualitative / presumptive testing) and chromatography (quantitative / confirmatory).[10] Qualitative testing only measures the presence or absence of a class of drugs and not the amount of a specific drug in the system. Quantitative testing is able to determine the exact amount of a specific drug or its metabolites in the system. In many cases, quantitative urine drug tests are not necessary since adequate information can be obtained via qualitative testing. Unfortunately, quantitative UDT to determine if a patient is taking their medication is not considered by CMS to be medically necessary because urine drug levels are not a good way to assess therapeutic drug levels.[11]

In order to establish that a drug screen is “reasonable and necessary” is it is important to document: (1) the medical and behavioral health history; (2) presence or absence of aberrant behaviors related to chronic pain management; (3) document the current treatment plan; (4) medications prescribed; (5) asses the risk potential for drug misuse, diversion, and addiction; and (6) use a validate risk assessment tool.[12][13] CMS regulations encourage laboratories to request documentation from physicians regarding medical necessity.

(iii) Medical necessity: The entity submitting the claim may request additional diagnostic and other medical information from the ordering physician or no physician practitioner to document that the services it bills are reasonable and necessary.[14]


UDTs are not considered medically necessary in several situations, including: (1) when the criteria have not been met; (2) there is repeated preliminary or confirmatory testing prior to receiving an initial preliminary test’s results; (3) routing confirmatory testing when there are negative results, unless those resulted are documented as being inconsistent; (4) to ensure the patient is taking the correct dosage of prescribed medication; or (5) routine analysis for specimen integrity. Id. at 5-6. Furthermore, testing for the same drug using both a blood test and a urine test is considered not medically necessary.[15]


In addition to the Guidance above, the Department of Health and Human Services, Office of Inspector General has published compliance guidance in the Federal Register entitled “Compliance Program Guidance for Clinical Laboratories”.[16] This guidance requires that order forms for laboratory testing should include the justification for each test ordered. The guidance also stressed that Medicare does not pay for tests for general screening purposes. Interestingly, the guidance also stated that standing orders are not prohibited in connection with an extended course of treatment, but did caution that they are discouraged and have led to abusive practices. Further the guidance said that “standing orders in and of themselves are not usually acceptable documentation that tests are reasonable and necessary”.[17]

With respect to frequency, low risk patients must be tested randomly every three months depending on state licensing board treatment requirements and should be tested for commonly abused illicit drugs. Moderate risk patients must be tested randomly ever two months and must be tested for illicit drugs and other prescribed drugs. High risk patients must be tested randomly every month, testing ideally will not be at each scheduled office visit[18].

Thus, physicians must accurately document the need for urine drug testing, must ensure that it is specifically tailored to the patient’s need and physicians should generally avoid standing orders for drug testing panels.

False Claims Act and “Stark” Liability

Pursuant to the False Claims act, 31 U.S.C. §§ 3729-33 provides that a person who knowingly presents or causes to be presented a false or fraudulent claim for payment or approval; or knowingly makes, uses or causes to be made or used, a false record or statement material to a false or fraudulent claim is liable to the United States Government for a civil monetary penalty of not less than $5,000 and not more than $10,000, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461), plus three times the amount of damages to the government. For the purposes of the False claims act, the terms “knowing” and “knowingly” mean that a person who has actual knowledge that a claim is false or acts with deliberate ignorance of the truth or falsity of a information or acts in reckless disregard for the truth of information acts with the requisite intent.[19] The Government is not required to prove specific intent to defraud in order to sustain liability under the False Claims Act.

According to the Stark Law, an entity may not submit claims to Medicare for clinical laboratory services if the services were referred to an entity by a physician with whom the entity had a financial relationship and there was no enumerated exception[20]. The term “financial relationship” includes a “compensation arrangement” between a physician and a laboratory where the physician is paid some form of compensation “directly or indirectly, overtly or covertly, in cash or in king” by the laboratory.[21] In addition to the Stark Law, the Anti-kickback statute prohibits the payment of remuneration for the referral of samples to a laboratory.[22]


Compliance with the false claims act, CMS regulations, and the Stark Law is a condition of payment and Medicare will not pay for services if either is violated.[23] In 2015, Millennium Health, a national drug testing laboratory agreed to pay $256 million to resolve allegations of unnecessary drug and genetic testing.[24] According to the complaint, Millennium laboratories billed Medicare Part B for medically unnecessary laboratory test services furnished by physicians and other providers and suppliers.[25] In many cases, Millennium is alleged to have billed for panels of drug tests that tested for drug which were not reasonable and necessary. This was done with the use of practice wide standing order forms that did not require an individualized assessment of which tests were necessary for a given patient.[26] This practice resulted in testing that was not reasonable and necessary for the individual patient. To make matters worse, Millennium encouraged that physicians engage in such testing and paid them remuneration in the form of supplies in the form of laboratory cups which was tied to physician referrals. These “custom profile” or “test protocol” forms were kept on file at Millennium and remained in effect until they were changed. When a patient’s sample was sent to Millennium by a particular provider, that provider’s panel was automatically run on each patient.


Unfortunately for Millennium the existence of a standing order is not sufficient documentation to validate the necessity of a large range of expensive drug testing for a particular payment. Moreover, the testing supplies provided to physicians in exchange for referrals was considered remuneration. As a result, Millennium paid out a significant settlement to the Government in order to avoid exclusion. Laboratories must be vigilant in protecting themselves from false claims act allegations by ensuring the medical necessity of each sample tested, this can be done by ensuring that the diagnosis code for each test matches the requisition form and only using custom panels for specific providers who demonstrate that a standing order is medically necessary for the patient population.

[1] The specific provider that is treating the patient must be the one to order the test. 42 C.F.R. § 410.32(a) [2] United States ex rel. Riley v. St. Luke’s Episcopal Hosp., 355 F.3d 370, 376 (5th Cir. 2004). [3] Greg T. Owen, M.D., et. al., Urine Drug Testing: Current Recommendations and Best Practices, Pain Physician Journal, at ES121 (2012). [4] Id. at ES122. [5] Id. at ES123. [6] 42 C.F.R. § 410.32(d)(3)(iii). [7] 711 F.3d 707, 715 (6th Cir. 2013) (applying the “reasonable and necessary” standard to diagnostic tests). [8] 42 U.S.C. § 1395y(a)(1)(A) [9] LCD: Drug Testing, Oct. 1, 2015, at 4. [10] WPS Medical Affairs Policy, PUM 250-0013, at 2 (Jul. 1, 2017). [11] Id. at 6. [12] Id. [13] 42 C.F.R. § 410.32(d)(3). [14] 42 C.F.R. § 410.32(d)(3) [15] LCD: Drug Testing, at 5. [16] 63 Fed. Reg. 45076 (Aug. 24, 1998) [17] Id. at 45079, 45081. [18] WPS Medical Affairs Policy, PUM 250-0013, at 5 (Jul. 1, 2017). [19] 31 U.S.C. § 3729(b)(1) [20] 42 C.F.R. §§ 411.351 et sequ. [21] 42 U.S.C. §§ 1395nn(h)(1)(A) and (h)(1)(B) [22] 42 U.S.C. § 1320a-7b. [23] 42 U.S.C. § 1320a-7(b)(7) [24] Department of Justice Press Release. October 19, 2015. [25] United States ex rel. Mark McGuire et al., v. Millennium Laboratories, Inc., and Millenium Health, LLC, No 12cv10132-NMG (2015) [26] Id. at 23.

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