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CAP Home > CAP Advocacy > STATLINE – CAP’s Biweekly Federal and State Advocacy E-Newsletter
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  STATLINE — CAP’s Biweekly Federal and
  State Advocacy E–Newsletter

August 14, 2014  •  Volume 30, Number 17
Next Issue: August 31, 2014
© 2014 College of American Pathologists

In This Issue:

Palmetto Removes Special Stains, IHC Article After Discussions With CMS

The Medicare Administrative Contractor Palmetto GBA has removed its website article on special stains and immunohistochemistry indications for gastric pathology after the CAP detailed objections to the posting in a letter to the Centers for Medicare & Medicaid Services (CMS).

Amongst the CAP’s objections, the article characterized by Palmetto as an “educational article” not only provided information, but also threatened potential “additional action” for noncompliance. The article seemed to change existing coverage policy without following requirements for making such changes.

“We appreciate your bringing this issue to our attention,” wrote CMS Administrator Marilyn Tavenner to the CAP. “We have carefully reviewed your concerns and discussed them with Palmetto GBA. Following these discussions, Palmetto informed [the CMS] that it decided to rescind the current version of this educational article and to revise the posting to address the issues you have identified in the CAP’s letter.”

The CMS believed this action addressed the CAP’s objections to the educational article. The CAP received the CMS’ letter on July 31.

The CAP had requested Palmetto’s posting be removed or significantly modified. The CAP strongly objected to Palmetto’s practice of using its website to post articles that threatened to use unspecified enforcement actions under the guise of education for a variety of reasons. Most prominently, the restrictions in the posting had not been vetted through the required legislatively-established Medicare local coverage determination (LCD) process. By not following this process, it denied stakeholders the opportunity to provide input on the validity and effectiveness of the proposed policy or to appeal the policy.

CAP Opposes Illinois Governor’s Veto of Anti-Markup Bill

After passing overwhelmingly in the Illinois General Assembly, Gov. Pat Quinn sent a CAP-supported, anti-markup of pathology services bill back to state lawmakers by issuing an amendatory veto and calling for several changes to the legislation.

The CAP and Illinois Society of Pathologists (ISP) support the original bill and disagreed with the governor’s August 5 amendatory veto. The CAP is working with the ISP to review options, which include a potential veto override later in 2014, and will work with the bill’s sponsors and legislative leaders going forward.

The legislation would require physicians who order biopsies and Pap tests to disclose to the patient the actual amount charged by the pathologist or laboratory that provides the service. The bill also would enhance patient billing protections to deter markups and grant new enforcement authority to the state when unlawful markups for pathology services are billed to insurers.

CAP-ISP work on the anti-markup bill included two years of legislative advocacy, and more than five years of building the public policy foundation to support passage. In a June 11 letter , CAP President Gene N. Herbek, MD, FCAP, urged Gov. Quinn to sign the legislation into law.

“In total, approximately more than 3/4 of the United States patient population is protected against pathology markups that improperly and unjustifiably escalate the actual cost of a patient’s pathology bill and health care costs in general by inducing unnecessary utilization,” Dr. Herbek said. “The current law in Illinois to prevent the pathology markup practice is insufficient and, thus, we believe this legislation will be more effective in ending a medical business practice that only serves to financially exploit both patients and payers to the detriment of health care quality.”

The bill passed the General Assembly Senate by a 51-4 vote on April 1. The Illinois House passed the measure by a vote of 91-16-1 on May 8.

On August 8, state Sen. William Haine, a sponsor of the bill, said he would call for an override to the veto. A three-fifths vote is needed to pass an override.

In Gov. Quinn’s veto message, he stated “In alignment with the AMA Code of Ethics, Senate Bill 1630 is a bill to prohibit improper escalation of fees in certain medical bills. At no time should patients be subject to unnecessary markups in their healthcare costs.” Gov. Quinn said that he vetoed the bill in order to make improvements.

‘Sunshine Act’ Site Taken Offline Temporarily

The CMS has suspended access to its Open Payments website while agency officials resolve problems regarding access to data on payments and gifts to physicians from industry groups.

The Open Payments system was taken offline to investigate a reported issue, the CMS stated in an August 7 announcement. With the system down temporarily, physicians, teaching hospitals, and authorized representatives can not register and review data reported by industry groups.

On June 1, manufacturers and group purchasing organizations (GPOs) began sending data to the CMS on payments to physicians and teaching hospitals for the last five months of 2013. These industry groups are required to disclose certain payments under the Physician Sunshine Act. Physicians and teaching hospitals have until August 27 to dispute the reported data if necessary. The data will then be posted online on September 30.

The CMS plans to adjust the Open Payments review and dispute deadlines to account for each day system is offline, the agency said. At this article’s deadline, access to the system was still unavailable.

Pathologists can submit questions in an email to a CMS help desk at Live Help Desk support is available by calling 1-855-326-8366, Monday through Friday, from 7:30 am to 6:30 pm CT.

CAP, AMA Urge System Delay

On August 5, the CAP, American Medical Association, and more than 100 specialty and state medical societies, stated in a letter to the CMS their serious concerns regarding the implementation of the Sunshine Act. While physician organizations supported the transparency initiative, they find the implementation via the Open Payments system unworkable.

“Perhaps most troubling, many physicians are expressing frustration at an overly complex registration process which, combined with the condensed timeframe, makes the task of reviewing and disputing reports by August 27 effectively impossible for the agency’s estimated 224,000 covered physician recipients,” the physician groups stated in the letter.

The letter urged the CMS to streamline the process, provide physicians with more time to review and dispute reports, and delay the publication of information collected in the Open Payments System until March 31, 2015.

Share Your Experiences on Open Payments

The AMA has developed a short advocacy survey designed to gather information about physicians’ experiences with registering in the Open Payments system and reviewing their data prior to the site’s shutdown. Pathologists also are encouraged to email their stories or anecdotes related to the Open Payments system to

Medicare Produces Individual Reports on IHC, Special Stains

CMS will be issuing comparative billing reports on immunohistochemistry and special stains in August, the Medicare agency announced.

The CMS said the reports, which are produced by a contractor, will contain data-driven tables and graphs with an explanation of findings. The reports will compare providers’ billing and payment patterns to their peers on the state and national levels. The CMS hopes the data and information will help achieve a greater understanding of Medicare billing rules.

The comparative billing reports will be available only to the providers who receive them, the CMS said. As a default, the CMS will use the fax numbers provided by physicians in the Medicare Provider Enrollment, Chain, and Ownership System (PECOS). Those who prefer to receive the reports by mail through the US Postal Service should contact the comparative billing reports support help desk at 800-771-4430 or

RACs Begin Auditing Medicare Claims, Again

Following a lengthy delay in awarding new Recovery Audit Contractor (RAC) contracts, the CMS has restarted its RAC program after a two-month suspension by utilizing the auditor companies already familiar to physicians and hospitals.

The CMS reported on its website on August 4 that it modified contracts for existing contractors and will allow for limited auditing to find improper Medicare payments. Most reviews will be automated, while few will be complex and require physicians and hospitals to submit medical records to the RACs.

RAC audits have returned billions of dollars to the Medicare program since it was permanently established in 2010. During the first three months of 2014 alone, RACs collected $665 million in overpayments to providers. Contractors also found Medicare underpaid providers $71.5 million and the payment amounts were corrected, according to CMS.

The CAP has advocated against unjust audits from RACs based on member experiences. In some instances, RACS have recovered payment for legitimate claims for pathology services creating confusion and an additional unnecessary burden. For instance, in February 2012, the CAP wrote the CMS about addressing problems related to RACs.


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