New Genetic Testing Benefits for Texas Medicaid Effective May 1, 2026

Effective for dates of service on or after May 1, 2026, new genetic tests will become benefits of Texas Medicaid.

Whole Exome Sequencing (WES)

WES (procedure code 81415) is a laboratory test that is used to determine the sequence of the protein coding regions of the genome. The exome is part of the genome that encodes protein, where roughly 85% of variants are known to contribute to diseases in humans.

Providers can use WES to identify or confirm the genetic etiology of a disorder. When needed for additional diagnostic insight, comparator genomes can be used by relatives, such as parents or siblings (procedure code 81416).

Reevaluation of the genome (procedure code 81417) can also be used for additional diagnostic yield.

WES is an alternative to whole genome sequencing (WGS). Only one of the two tests is allowed per lifetime for clients who meet the medical criteria for either WES or WGS. The ordering provider is responsible for choosing which test to perform.

Prior Authorization Requirements

Effective May 1, 2026, with prior authorization:

• Procedure codes 81415 and 81417 will become benefits of Texas Medicaid once per lifetime with any provider.
• Procedure code 81416 will become a benefit of Texas Medicaid up to a maximum of twice per lifetime with any provider.

Providers may refer to the Texas Medicaid Provider Procedures Manual (TMPPM), Radiology and Laboratory Services Handbook, section 3.2.1, “Authorization Requirements for Whole Genome Sequencing,” for additional prior authorization requirements for both WES and WGS.

FoundationOne Testing

FoundationOne tests use next-generation sequencing (NGS) to analyze hundreds of cancer-related genes and identify the four main classes of genomic alterations in clients with advanced solid tumors:

• Base substitutions
• Insertions and deletions
• Copy number alterations
• Gene rearrangements or fusions

The FoundationOne CDx test (procedure code 0037U) identifies alterations in 324 genes and genomic signatures that are isolated from solid tissue samples, including:

• Microsatellite instability.
• Tumor mutational burden.
• Positive homologous recombination deficiency status on deoxyribonucleic acid (DNA).

The FoundationOne liquid CDx test (procedure code 0239U) includes:

• The use of plasma.
• Cell-free DNA.
• Analysis of 311 or more genes.
• Interrogation for sequence variants, including:
  • Substitutions.
  • Insertions.
  • Deletions.
  • Select rearrangements.
  • Copy number variations.

Prior Authorization Requirements

Effective May 1, 2026, procedure codes 0239U and 0037U will be benefits of Texas Medicaid. Prior authorization is required. A FoundationOne test, either CDx or liquid CDx, may be a benefit of Texas Medicaid and is limited to once per lifetime, per type of cancer, to guide targeted therapy when all the following test critieria are met:

• An oncologist ordered the test.
• The target tumors are advanced.
• Providers intend to identify treatment options and get information about potential targeted therapies to better inform treatment decisions.
• Providers use the test as a broad molecular profiling tool to identify biomarkers that are present in the tumor and are not considered medically necessary.

Important: The test must be conducted as a companion test to a U.S. Food & Drug Administration (FDA)-approved therapy.

Providers can perform only one of the two tests (procedure code 0037U or 0239U) for clients who meet the medical necessity criteria for FoundationOne testing. The ordering provider is responsible for choosing which test to perform.

Transplant Rejection Testing

Transplant rejection occurs when a recipient’s immune system recognizes a transplanted organ as foreign and attacks it. This response may cause the transplanted organ to fail. Providers may use gene expression profiling tests and serum cell-free DNA evaluations to monitor organ transplant rejection.

Prior Authorization Requirements

Effective May 1, 2026, procedure codes 81595, 0493U, and 0540U will be benefits of Texas Medicaid. Prior authorization is required.

Texas Medicaid considers transplant rejection testing to be medically necessary when all the following criteria are met:

• The transplant rejection test must provide information about at least one of the two following clinical status determinations:
  • Active rejection (AR)
  • Acute cellular rejection (ACR) or antibody-mediated rejection (AMR)
• Providers must intend to use the transplant rejection test in one of the following ways:
  • To help evaluate whether immunosuppression is adequate when a noninvasive or minimally invasive test can be used instead of a tissue biopsy to guide a management decision about immunosuppression
  • As a rule-out test for AR in validated populations of clients with clinical suspicion of rejection with a noninvasive or minimally invasive test to make a clinical decision about obtaining a biopsy
  • To perform further evaluation of allograft status for the probability of allograft rejection after a physician-assessed pretest
  • To assess rejection status in clients who have received a biopsy, but the biopsy results are inconclusive or limited by insufficient material
• For a given client encounter, only one molecular transplant rejection test for assessing allograft status may be performed unless a second transplant rejection test, meeting all the established criteria, is reasonable and necessary as an adjunct to the first test.

For heart transplant clients who are 15 years of age or older and are at least 55 days post-transplant, Texas Medicaid may consider procedure code 81595 to be medically necessary with the following frequency:

• Every month for clients who are 2 to 12 months post-transplant
• Every three months for clients who are more than 12 months post-transplant
• Every six months for clients who are more than 36 months post-transplant

For heart transplant recipients who are 15 years of age or older and are at least 28 days post-transplant, Texas Medicaid may consider the use of donor-derived cell-free DNA tests (procedure codes 0493U and 0540U) to be medically necessary with the following frequency:

• Every month for clients who are 1 to 12 months post-transplant
• Every three months for clients who are more than 12 months post-transplant
• Every six months for clients who are more than 36 months post-transplant

For other organ transplants (kidneys, lungs, liver), Texas Medicaid does not consider the following tests to be medically necessary:

• Donor-derived cell-free DNA tests
• Peripheral blood gene expression profiling tests

Texas Medicaid does not consider mRNA expression profiling of biopsied tissue from a transplanted organ to assess rejection and injury in transplanted organs to be medically necessary.

Texas Medicaid does not consider the measurement of volatile organic compound to assist in the detection of moderate grade 2R/grade 3 heart transplant rejection to be medically necessary.

ClonoSEQ Testing

ClonoSEQ testing (procedure code 0364U) uses next-generation sequencing (NGS) to detect or quantify minimal residual disease (MRD) in clients with acute lymphocytic leukemia (ALL), chronic lymphocytic leukemia (CLL), or multiple myeloma.

Providers must submit claims for ClonoSEQ testing (procedure code 0364U) with one of the following diagnosis codes:

Texas Medicaid may reimburse independent laboratory providers that submit claims for procedure code 0364U if the services are rendered in an outpatient hospital setting to a client of any age.

Providers may be reimbursed for the services more than once in the client’s lifetime if the services are appealed and shown to be medically necessary.

Enhanced Liver Fibrosis Testing

Enhanced liver fibrosis (ELF) testing (procedure code 81517) detects and identifies liver fibrosis in clients with chronic liver disease.

Texas Medicaid may reimburse independent laboratory providers for services that are rendered in the hospital setting to clients of all ages. Providers must submit claims for procedure code 81517 with one of the following diagnosis codes:

When a provider submits claims for procedure code 81517 more than twice per year or the test was performed within six months following a liver biopsy (or other liver fibrosis tests), Texas Medicaid does not consider the test to be medically necessary.

Providers must document medical necessity for a liver biopsy (procedure code 47000 or 47100) performed within five months of a transient elastography (TE) (procedure code 91200) or magnetic resonance elastography (MRE) (procedure code 76391). This documentation must be maintained in the client’s medical records and is subject to retrospective review.

On May 1, 2026, the Texas Medicaid & Healthcare Partnership (TMHP) will update the TMPPM, Radiology and Laboratory Services Handbook, to add the new genetic testing benefits.

Breast Cancer Index Testing

The breast cancer index (BCI) (procedure code 81518) will be a benefit of Texas Medicaid when all the following criteria are met:

• The clinical stage of breast cancer is I, II, or IIIa in cases where the cancer has not spread to more than three lymph nodes.
• The primary tumor is estrogen receptor or progesterone receptor positive.
• The cancer cells are HER-2/neu receptor negative.
• Adjuvant therapy is not precluded because of any other factor (such as advanced age or significant comorbidities).
• Before BCI testing, the client and provider must discuss the potential results of the test and agree to use the results to guide therapy.

Texas Medicaid may reimburse claims for procedure code 81518 when they are submitted by:

• Physician providers for services that are rendered in the office setting.
• Hospital providers for services that are rendered in the outpatient hospital setting.
• Independent laboratory providers for services that are rendered in the laboratory setting.

Providers must submit claims for procedure code 81518 with one of the following diagnosis codes:

Texas Medicaid may reimburse claims for procedure code 81518 more than once per lifetime for the same client on appeal if the provider submits documentation demonstrating that the client has a new, second primary breast cancer diagnosis that meets medical criteria.

On May 1, 2026, TMHP will update the TMPPM, Medical and Nursing Specialists, Physicians, and Physician Assistants Handbook, section 9.2.15.4, “Prognostic Breast and Gynecological Cancer Studies,” to add the BCI benefit information.

Reimbursement

Texas Medicaid may reimburse claims for the following genetic testing procedure codes:

Texas Medicaid may reimburse independent laboratory providers for claims for procedure code 0037U or 0239U for services that are rendered in the outpatient hospital setting to clients of all ages.

Texas Medicaid may reimburse independent laboratory providers for claims for procedure code 0493U or 0540U for services that are rendered in the outpatient hospital setting to clients who are 15 years of age or older.

Texas Medicaid may reimburse independent laboratory providers for claims for procedure code 81415 or 81416 for services that are rendered in the outpatient hospital setting to clients who are birth through 20 years of age.

Texas Medicaid may reimburse independent laboratory providers for claims for procedure code 81595 for services that are rendered in the outpatient hospital setting to clients who are 15 years of age or older.

For more information, call the TMHP Contact Center at 800-925-9126.

Note: Texas Medicaid managed care organizations (MCOs) must provide all medically necessary, Medicaid-covered services to Medicaid members who are enrolled in their MCO. Administrative procedures, such as prior authorization, precertification, referrals, and claims and encounter data filing, may differ from traditional Medicaid (fee-for-service) and from MCO to MCO. Providers should contact the member’s specific MCO for details.