At last, more uniform coverage for high-volume tests
The federal "negotiated rulemaking" process, which the College
and other organizations participated in three years ago, has finally
produced national coverage policies, which will be carried out in
two stages this year.
The policies, published Nov. 23, 2001 in the Federal Register,
include 23 national coverage policies for specific tests (Fig.
1) and will apply to all who bill for clinical and anatomic
pathology services under Medicare Part B and the carriers who process
"The policies provide for uniform coverage of high-volume laboratory
tests in a broad range of clinical settings," says Stephen N. Bauer,
MD, who represented the College on a panel that crafted the policies.
"The impact on practitioners will vary depending on their location
and how their carrier previously implemented coverage decisions."
In regions that previously had restrictive policies limiting the
ICD coded diagnoses that would be covered, this will provide "much
greater clinical latitude" for testing, Dr. Bauer says. Where there
were few or no restrictions on coverage, this will impose a new
documentation requirement. "Overall," he says, "we believe that
the benefits will outweigh the need for more documentation, and,
more important, the process will be uniform and have received broad
input from the organized physician and laboratory communities."
The coverage and administrative policies are the culmination of
a process that began in July 1998, when, under a mandate by the
Balanced Budget Act of 1997, the federal government established
a negotiated rulemaking committee. The budget act provision was
a response to concerns in the laboratory community about inconsistent
coverage policies among Medicare’s many claims contractors nationwide.
The committee, which included representatives from the Health
Care Financing Administration (now the Centers for Medicare and
Medicaid Services), the College, and 16 private groups, reached
tentative agreement on Jan. 27, 1999 on 23 national coverage policies
and other uniform documentation and claims-processing requirements.
After the groups on the committee made a round of revisions, HCFA
released a draft rule July 9, 1999 and a formal proposed rule March
The November final rule reflects public comments the CMS received
on the March 2000 proposed rule, including the College’s comments
submitted in May 2000. The CAP had asked that, to establish a date
of service on claims, the coverage policies recognize both the date
of specimen collection and the date of accession and leave the choice
to the laboratory. The College also asked that the policies allow
for routine use of advance beneficiary notices as a way to alert
physicians and patients to the use of frequency screens under the
On the first point, CMS replied that it would maintain its position
that the date of service be reported as the date of specimen collection.
"We do not believe that it is consistent with the statutory requirement
to promote national uniformity to permit a variety of means to report
the date of service," CMS said in the rule, responding to the College’s
comment. The agency did note that the "implementing instructions"
for the national coverage policies "will carefully emphasize" the
requirement to report the date of collection to those collecting
specimens. "We are optimistic that after adequate education from
us and the Committee member organizations ... most of those collecting
specimens for laboratory testing will take care to report required
information," the CMS said.
On the issue of ABN use to protect laboratories that are denied
compensation because of frequency screens, CMS simply said ABNs
were not within the scope of the negotiated rulemaking process.
The agency was more positive in its response to a third College
recommendation: that, for certain diseases, the policies should
recognize family history as a basis for diagnostic testing. Medicare
now considers such testing to be screening services and, under long-standing
program policy, not eligible for coverage.
CMS said it, as well as many members of the committee, "recognize
that there may be many instances when testing of beneficiaries in
the absence of specific signs, symptoms, diagnosis, or exposure
to disease is good health care." While it did not include the College’s
request in the final rule, it did say it would consider "generating
an internal request for a national coverage decision addressing
the role of family history as a medical justification for a test
being reasonable and necessary. . . ."
Says Dr. Bauer: "Coverage for testing based solely on family history
is problematic because of the wording of the Medicare statute. The
negotiated rulemaking process only dealt with covered services,
and as a result the coverage for such testing was not negotiated.
But this is an area of concern for the College and other physician
groups, and I would hope that there will be further discussions
with CMS. In the meantime, providers will need to obtain ABNs to
allow them to bill for testing in this setting."
New ABN policies are near completion and expected to provide an important
companion tool for laboratories to use in ensuring they receive payment for
Medicare testing when the program will not cover a service. For information
on new ABN forms and instructions, log on to the CAP Web site at www.cap.org.
Under the final rule’s timeline, the national coverage determinations
will replace locally developed carrier and intermediary policies
next fall. Those local-level policies, called local medical review
policies, or LMRPs, explain when an item or service will or won’t
be considered "reasonable and necessary" and eligible for Medicare
coverage. It was inconsistency across carriers in their LMRP criteria
that, in part, prompted efforts to seek the legislative mandate
for negotiated rulemaking and national coverage policies.
In the November final rule, CMS is clear on how LMRPs will fit
into the national coverage policy scheme. The agency wrote: "An
LMRP may not conflict with a national coverage decision once the
national coverage decision is effective. If a national coverage
decision conflicts with a previously established LMRP, the contractor
must change its LMRP to conform to the national coverage decision.
A contractor may, however, make an LMRP that supplements a national
coverage decision where the national coverage decision is silent
on an issue. The LMRP may not alter the national coverage decision."
Most of the new policies that require health care providers to
make adjustments will not go into effect until Nov. 25. Provisions
(Fig.2) not likely to require
system changes or result in a significant volume of claims denials
will begin Feb. 21. Most of these policies clarify existing conventions
that either have caused confusion among health professionals or
have been largely unpublished. Other policies (Fig.3)—those
that will require adjustments by laboratories, ordering physicians,
or Medicare contractors—will be put in place next fall after
extensive educational programs conducted by those who developed
the policies take place.
Educational efforts are planned to ensure that those affected
by the new policies know about them and know their roles under the
new rules before the policies start. Also, entities that need time
for computer system changes necessitated by the new policies can
apply for an adjustment period extension of up to 12 months.
Dr. Bauer emphasizes that the new coverage and administrative policies are
not set in stone. "The final rule makes it clear that CMS will meet the statutory
requirement for review every two years," he says. Furthermore, "it was clear
in the rulemaking process that both CMS and providers wanted an ongoing process
for review." The CMS Web site offers one route for feedback, including direct
e-mail links to agency staff involved in the negotiated rulemaking process.
The complete final rule that discusses the new policies in detail,
including the 23 coverage policies, is on the College’s Web site
the "Advocacy" area, under "From the Government." The CAP will post
notices about educational seminars on the coverage policies as they’re
announced this year.
Carl Graziano is CAP TODAY Washington editor and CAP manager
of government communications.