Medicare’s 14-Day Laboratory Rule: When the Calendar Changes Who Gets Paid

The Medicare 14 day laboratory rule helps determine whether a hospital or the performing laboratory bills Medicare for testing on a hospital specimen. Collection, discharge, ordering and testing can happen on different dates, and those dates can change who gets paid. For someone handling cancer-test orders or hospital accounts, the concern can be very concrete: an order held until the calendar changes, a canceled test ordered again, or a hospital invoice quietly written off.

The default date of service is the specimen-collection date. Exceptions can move it to the date of testing or removal from storage. Each exception has its own conditions, and the outpatient molecular-testing exception has no fourteen-day waiting requirement. The financial question is which entity had the right to bill, under the rule that applied to that test at that time.

Which Laboratory Date of Service Applies?

The Medicare laboratory date-of-service regulation starts with collection. For a specimen collected across two calendar days, the date is the day collection ended. The rule covers clinical laboratory tests and the technical component of physician pathology services.

The physician’s order, specimen collection, the laboratory’s access to the specimen, performance and production of results may all occur separately. The date entered on the claim connects that sequence to Medicare’s payment rules.

Stored Specimens and the Fourteen-Day Order Requirement

For a specimen stored no more than 30 calendar days from collection, the performance date becomes the date of service only when all of these conditions hold:

• The patient’s physician ordered the test at least fourteen days after hospital discharge.
• The specimen was collected during a hospital surgical procedure.
• Collecting the sample outside that procedure would have been medically inappropriate.
• The results did not guide treatment during the hospital stay.
• The test was reasonable and medically necessary to treat an illness.

The clock runs from discharge to the physician’s order. The surgical collection and the purpose of the results matter alongside the dates.

A specimen stored more than 30 calendar days before testing falls into the archived-specimen rule. Its date of service is the date it was taken out of storage, for both inpatient and outpatient specimens. This exception has no post-discharge order requirement.

Chemotherapy Sensitivity Has a Different Trigger

For a chemotherapy-sensitivity test on live tissue, the performance date applies only if the decision about which chemotherapy drugs to test was made at least fourteen days after discharge. The rule concerns tests identified by Medicare that need fresh tissue to assess tumor cells’ sensitivity to chemotherapy drugs.

The remaining conditions match the surgical-collection, treatment and medical-necessity conditions for recently stored specimens above.

Outpatient Molecular Tests Can Use the Performance Date

Qualifying outpatient molecular tests use the performance date without a fourteen-day wait. The current exception covers molecular pathology tests performed by laboratories other than blood banks or blood centers, certain advanced diagnostic laboratory tests designated by the Centers for Medicare & Medicaid Services, cancer-related protein-based multianalyte assays with algorithmic analyses, and the test described by CPT code 81490.

The test must be performed after discharge from the hospital outpatient department. The specimen must have been collected from a hospital outpatient during that encounter, and collecting it then must have been medically appropriate.

The results must not guide treatment during the outpatient encounter, and the test must be reasonable and medically necessary to treat an illness.

The Centers for Medicare & Medicaid Services maintains an exception-code list on its policy page, updated quarterly as appropriate.

How Should Laboratory Tests Be Bundled for Medicare?

For hospital-linked testing, the date of service helps determine whether the test belongs with the hospital encounter or can be billed directly by the performing laboratory.

For inpatient testing covered by the hospital’s lump-sum payment, the hospital receives payment for the service as part of the stay. The outside laboratory seeks payment from the hospital. A separate laboratory claim to Medicare can make the government pay again for a service already included in that payment.

Outpatient billing has a different history. Before the molecular exception, a laboratory generally had to seek payment from the hospital for a test ordered inside the post-discharge window, even when Medicare paid separately for that kind of test. The hospital could then seek Medicare reimbursement.

Under the current qualifying outpatient exception, the test is disconnected from the hospital encounter for billing. The performing laboratory must bill Medicare directly under the Clinical Laboratory Fee Schedule.

Who Bills Medicare When the Outpatient Exception Applies?

For a test that qualifies for the outpatient date-of-service exception, the agency’s questions and answers say the performing laboratory must bill Medicare. The hospital may bill only if its own laboratory actually performed the test.

The outpatient exception requires a registered hospital outpatient and an outpatient encounter. It does not extend to an inpatient specimen or to a specimen collected from a non-patient, meaning someone who was not a registered hospital outpatient. The place and status of collection therefore remain part of the story even when an outside laboratory performs the same kind of test afterward.

What Changed in the Rule?

The major change for molecular laboratories took effect on January 1, 2018, when the Centers for Medicare & Medicaid Services introduced the outpatient exception. Its implementation date was July 2, 2018. The change gave qualifying laboratories a direct Medicare billing route for tests that previously required them to seek payment from hospitals.

The Centers for Medicare & Medicaid Services excluded molecular pathology tests performed by blood banks and blood centers in its rule for 2020. Its rule for 2021 added the protein-based cancer assays and the test described by CPT code 81490.

Delayed Genomic Test Orders and the Hospital Bill

A delayed genomic test order can move the bill away from a hospital when the order is held to get around the Medicare 14 day rule. The alleged practice in the enforcement cases was deliberate control of the order’s submission or cancellation and reordering after the discharge window.

That is why the original clinical decision matters. The stored-specimen exception asks when the physician ordered the test. The chemotherapy exception asks when the drugs to test were selected. In the delayed-order cases, the government described decisions already made and orders held or replaced to change the billing result.

Genomic Health and the Unpaid Hospital Invoice

Genomic Health agreed to pay $32.5 million in October 2023 to settle allegations involving its Oncotype DX genomic tests. The tests help with diagnosis and treatment of cancer patients. The Justice Department described direct Medicare claims that should have fallen within inpatient hospital payments, outpatient tests that should have been billed to hospitals, and canceled orders placed again after the waiting period.

The government alleged that the company encouraged hospitals and physicians to cancel and reorder tests, and failed to discourage providers doing so. An order already existed. Canceling it and entering another changed the billing chronology the laboratory presented.

The late laboratory invoices to hospitals show another way the date-of-service rule could be evaded. The government alleged that Genomic Health failed to send timely hospital invoices for services covered by the rule and then wrote off the unpaid fees. The government alleged that those write-offs were kickbacks.

The alleged financial benefit was a hospital obligation that disappeared. In that account, the laboratory had performed the service, the hospital owed the fee, and the laboratory let the fee go unpaid. The invoice history and the write-off decision therefore matter alongside the Medicare claim. The settlement resolved allegations from two whistleblower cases, with a $5.7 million whistleblower share announced from the proceeds.

Caris and Orders Canceled and Placed Again

Caris Life Sciences settled for $2,886,674 in June 2022 over alleged improper Medicare billing for its Caris Molecular Intelligence and ADAPT Biotargeting System cancer tests. The government said Caris billed Medicare directly for inpatient tests already covered by the hospital’s lump-sum payment, so taxpayers paid twice for the same service.

The allegations also covered direct claims for tests ordered within the outpatient window and Caris’s failure to discourage providers from canceling early orders and placing new ones after the window elapsed. The tests helped physicians choose cancer treatment. The government described their delay as serving the billing arrangement.

In the government’s account, cancer tests waited on a billing date. The settlement resolved allegations brought in two whistleblower cases.

Labcorp, University Health System and the Held Orders

Labcorp and University Health System paid $388,667 in a settlement announced in January 2025. The government alleged that they delayed physician orders for Caris testing to enable improper Medicare billing.

University Health System operates University of Tennessee Medical Center. Labcorp provided clinical laboratory services through its Tennessee operation at the medical center’s outpatient laboratory. According to the government’s allegations, orders were held for submission or canceled and resubmitted until fourteen days after discharge.

The alleged conduct occurred between March 2012 and November 2023. The hospital and its laboratory-service provider were part of the alleged ordering arrangement, while Caris performed the testing. The business handling an order can help cause the eventual claim even when another laboratory sends it to Medicare.

What the Order and the Accounts Reveal Together

We connect the clinical decision to the bill and the money that followed it. A replacement order may carry a later date while the earlier order shows that the clinical request already existed. A write-off entry can explain what happened to a hospital fee after the laboratory completed its work.

The government’s allegations that Agendia caused medically unnecessary MammaPrint testing through standing orders raise the same question of who decided the patient needed the test.

The older laboratory literature makes the connection between ordering and accounting concrete. Model Plan Helps Laboratories Fight Fraud, published in Laboratory Medicine in 1997, described the federal compliance plan’s emphasis on keeping records, documenting medical necessity on requisitions and monitoring standing orders. Those records reach the decision behind the test as well as the bill that followed it.

For a healthcare fraud case involving these dates, we examine how that decision traveled through the business. The physician’s request, the order sent to the testing laboratory and the claim can describe different moments. Hospital invoices and write-offs add the financial relationship that the test result alone cannot show.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

When You Know Why the Order Waited

If you handled orders held after discharge or hospital invoices that disappeared into write-offs, speak with our whistleblower experts about who made those decisions. We work with you to connect the clinical request, the billing dates and the financial benefit into your strongest laboratory fraud case. We bring in laboratory fraud whistleblower lawyers who understand hospital payment arrangements and stay with you through the case.