College of American Pathologists
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February 4, 2010  •  Volume 26, Number 3
Next Issue: February 18, 2010
© 2010 College of American Pathologists

In This Issue:

Judge Hears Oral Arguments in Gene Patent Lawsuit
MedPAC to Recommend 1% Increase in SGR for 2011
Illinois Supreme Court Upholds Pathologist PC Billing
Pathology Organizations Meet to Address Health Care Reform

Judge Hears Oral Arguments in Gene Patent Lawsuit

Oral arguments from both sides in the “Myriad gene patent” lawsuit, Association for Molecular Pathology, et al. v. U.S. Patent and Trademark Office, et al., (in which CAP is a plaintiff), were presented in federal court in New York on Tuesday, marking the first time oral arguments against gene patents have been heard in federal court. U.S. District Judge Robert Sweet did not issue a decision.

Last March, the American Civil Liberties Union and the Public Patent Foundation, representing cancer victims and medical groups including the CAP and over 150,000 pathologists, researchers, and other professionals, sued Myriad Genetics, the University of Utah Research Foundation and the U.S. Patent and Trademark Office.

The issue is Myriad’s refusal to broadly allow others to research the BRCA1 and BRCA2 genes, known to contain important information about breast and ovarian cancer, and critical to developing new and effective treatments. The CAP and ACLU contend the genes are naturally occurring phenomena and therefore cannot be patented, and the patents are unconstitutional restrictions on knowledge.

Patents aren’t allowed for rules of nature, natural phenomena or abstract ideas, although the Patent and Trade Office has said genes can be patented if they are “isolated from their natural state and purified.”

In its court filing, Myriad said a decision to invalidate the patents would “lead to the invalidity of thousands of biotechnology patents, and effectively unravel the foundation of the entire biotechnology industry. Numerous therapeutic drugs and diagnostic tests in development would be jeopardized.”

Myriad, with support from the biotechnology industry, said its patents cover how to sequence the gene to identify its components, then map out that sequence to look for mutations to determine if the woman has a higher risk of developing breast cancer. Myriad charges up to $3,000 to test whether a woman has genetic mutations that indicate an increased risk of breast and ovarian cancer.

“This is not a patent on information,” Myriad lawyer Brian Poissant told the judge. “This is a patent on a chemical composition.”

Christopher Hansen, an ACLU lawyer, told Sweet that researchers deserved praise but not patents for winning the race to isolate genes related to breast and ovarian cancer. “New forms of testing and new ways of using the gene have been inhibited,” Hansen said. “That’s not good for women’s health.”

Judge Sweet’s decision is expected to take a month or more, and is likely to be appealed to a court in Washington, D.C., that specializes in U.S. patent law.

Statline will continue to follow this important issue.

Comment On This Article

MedPAC to Recommend 1% Increase in SGR for 2011

At its January 14 meeting, the Medicare Payment Advisory Commission (MedPAC) agreed on a number of recommendations for its upcoming report to Congress on payment adequacy and updates for physician services. The report is expected to be released on March 15, 2010.

2011 Update Recommendation

MedPAC will recommend a 1.0% update payment for physician services in 2011.This decision was based on the current forecast on cost changes expected in 2010, including:

  • Input Price Inflation: 2.1% (not adjusted for productivity)
  • Physician Work: 2.2%
  • Physician Practice Expense: 2.0%
  • Medicare Economic Index: 0.9% (includes productivity adjustment)

The 1% update would increase spending by $2 billion in 2011 and $10 billion over five years.

Primary Care Services (restatement of June 2008 and March 2009 recommendations)

MedPAC’s March report will include a restatement of its June 2008 and March 2009 recommendations to Congress, to “increase payments for fee-for-service health care services furnished by practitioners who focus on primary care.” The recommendation calls for a budget neutral increase focused on practitioners with specialty designation in primary care and/or whose pattern of claims meet a minimum threshold of furnishing primary care services.

Appendix to Report on Accuracy of Physician RVUs

MedPAC’s next report to Congress will also include an appendix on the accuracy of the physician work Relative Value Units (RVUs) which determine the value of each physician service. MedPAC staff is currently working with AMA staff on this review, with input from CAP and others. This may lead to recommendations for alternative data sources on physician time or general changes to the valuation process.

Illinois Supreme Court Upholds Pathologist PC Billing

The Illinois Supreme Court last week denied a petition to review the recent decision of the Appellate Court of Third Circuit of Illinois to allow professional component billing by pathologists in the Martis v. Pekin Memorial Hospital case.

As reported previously in Statline, the lawsuit was filed by a patient on behalf of himself and all others similarly situated, against Pekin Memorial Hospital, Data Management Inc., and Peoria-Tazewell Pathology Group, stemming from laboratory tests his physician ordered in 2004. One month after the tests were performed, the patient received a bill from the hospital for $609, and a bill from the pathologist group for $73.30.

Although the form authorizing treatment, which the patient signed and which the court found to be an express contract, explicitly included the services provided by pathologists, the plaintiff alleged defendants double-billed for their services. The case also claimed the pathologists were unjustly enriched.

Two lower courts have already ruled professional component billing is not actionable. The Illinois Supreme Court’s denial to hear the case brings this lawsuit to a conclusion.

Pathology Organizations Meet to Address Health
Care Reform

The CAP convened its annual National Pathology Organization stakeholder meeting last Friday, providing leaders from key pathology organizations an opportunity to discuss health care reform initiatives, and the challenges and opportunities facing pathologists and laboratory medicine.

“Right now there is a great deal of urgency among policymakers to change the way healthcare is delivered,” said Dr. Louis Wright, MD, FCAP, chair of CAP’s Council of Government and Professional Affairs, and convener of the meeting.

“Adapting to practice changes as a result of health care reform will be critical for our members. Pathologists can support the goals of reform by participating in care coordination activities, improving communication among and between providers and patients, and by delivering on the goals of personalized health care.”

Issues that were discussed included: workforce challenges, laboratory education programs, health information technology, policy developments in molecular testing, and gene patents.

National organizations at the meeting included: the American Society for Clinical Pathology, the American Society of Cytopathology, the Association for Molecular Pathology, the Association of Pathology Chairs, the American Pathology Foundation, the United States and Canadian Academy of Pathology and the College.


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