The Cost of Unclear Documentation: What Toxicology and Molecular Labs Need to Know About Medical Necessity
Toxicology and molecular testing are more essential than ever—especially in pain management, addiction treatment, urgent care, primary care, and women’s health. But even as demand grows, labs across the country are bleeding revenue. Why? Because provider documentation around medical necessity and prior authorization cannot keep up with the ever-increasing payer requirements and restrictions.
Even when labs use the correct ICD-10 codes from providers, that’s no longer enough to guarantee reimbursement. Payers now demand clear, individualized justification (e.g., medical necessity) for every test performed—and, prior authorization documentation that fully explains how the payer’s medical necessity requirements were met. Without both, labs are left facing denials, audits, and high-dollar recoupments.
What about asking the provider to document their chart notes better? Yeah, good luck with that. Overwhelmed, burned out, and fed up with the egregious amount of time on administrative work instead of patient care, labs know it’s not going to happen. So, for years, labs accepted a 30% revenue haircut every month without a solution. Until Cellarian.
It’s Not What You Collect. It’s What You Keep.
Across the industry, certain documentation gaps keep showing up:
Relying too heavily on ICD-10 codes without supporting clinical context.
Billing large test panels when only a subset of tests were clearly warranted.
Missing proof of a physician’s review of prior results before ordering a new test.
Not billing appropriately for a particular provider
Failing to document why specific drug classes—or molecular targets—were tested.
Submitting prior authorization requests without clear and concise medical necessity justification that meets payer-specific requirements.
Getting all that information from referral sources is impossible for a busy, high-volume clinical lab. Even when a lab receives medical records, the information is strewn throughout the chart. Do you think the payer will sift through 125 pages to determine that the medical necessity was met, so they can send your lab a check? Ummmm….no. Magical thinking is great when you’re five– not so great when your lab’s cash flow slows to a trickle right as the recoupments come.
The Real-World Impact
Without airtight documentation and authorization tracking:
Claims are denied, underpaid, or clawed back.
Staff spend hours chasing down clarifications, managing appeals, and following up to get medical records that won’t help.
Audits can trigger recoupments and cost a fortune in preventable legal fees.
In a tight-margin industry like toxicology and molecular diagnostics, these aren’t just annoyances—they’re threats to sustainability.
How Cellarian Helps You Stay Ahead
Cellarian takes the guesswork—and the grunt work—out of medical necessity documentation and prior authorization approvals. Our automation platform ensures every test order is backed by the right documentation, tailored to each payer’s requirements. Here’s how we help:
Captures clinical data automatically to create patient-specific documentation, so you’re not left chasing your customers for detailed notes after the fact.
Validates documentation and prior authorization requirements—saving you from denials, delays, and recoupments.
Connects the clinical dots, ensuring every test ordered is tied to the patient’s diagnoses, risk profile, treatment plan, and other relevant clinical information..
Keeps your team ahead of payer rule changes, helping you meet shifting documentation and authorization expectations without constant manual oversight.
With Cellarian, your lab can stay compliant and maximize revenue capture that was previously unreachable, while protecting that revenue from audits and clawbacks down the line.
Get Paid. Stay Compliant. Grow Your Lab
Submitting a claim with a code isn’t enough. It’s not 1998.—but with Cellarian, labs don’t have to accept not getting paid because of the payer documentation games.
Cellarian automates the documentation and authorization burden, helping toxicology and molecular labs prove medical necessity, meet payer rules, and get paid for the critical work they do.
Ready to stop losing revenue over missing documentation or prior authorizations?
Contact our team to discover how Cellarian can help your lab thrive in today’s reimbursement landscape.
