College of American Pathologists
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February 16, 2012  •  Volume 28, Number 4
Next Issue: March 1, 2012
© 2012 College of American Pathologists

2012 CAP Policy MeetingIn This Issue:

Congress to Vote on Medicare Deal This Week, Extends SGR Freeze but Phases Out TC-Grandfather

As Congress finalizes legislation that will extend the Medicare 2011 Sustainable Growth Rate (SGR) formula through 2012, the College has learned more about some troubling details of the bill, including a 4-month phase out of the Technical Component (TC) “Grandfather” provision, and a new cut in payments to the Clinical Laboratory Fee Schedule.

If passed as expected, the bill provides temporary relief to Medicare physicians who otherwise will face a 27.4% pay cut in exactly two weeks. Unfortunately, a 10-month patch also sets the stage for renewed drama in the fall. With the November elections just around the corner, CAP leaders are already expressing concern about SGR negotiations during an election season, or afterwards, during a lame duck session of Congress.

“There’s no question we appreciate Congress’s action on averting the 27.4% pay cut. That is a scary number,” said CAP President, Stanley Robboy, MD, FCAP. “But we are disappointed lawmakers are not taking the opportunity to use the savings realized from military operations in Afghanistan and Iraq, and other unspent allocations, to prevent ever having to return to this issue again. As it stands now, we will be in the same position, and possibly worse position, when we are forced to return to this problem again in the fall.”

The American Medical Association and the CAP had advocated for a permanent SGR fix, paid for with savings from winding down operations in Iraq and Afghanistan. However, this solution was opposed by a vocal group of House Republicans. To cover the nearly $20 billion cost of the patch, negotiators are pulling money from a fund earmarked for preventive medicine in the 2010 health reform law and cutting Medicare “bad debt” payments to hospitals. They also plan to reduce payments to the Clinical Lab Fee Schedule by $2.7 billion over 10 years.

“The College is very concerned that such a deep cut to the Clinical Lab Fee Schedule, compounded with other cuts in health care reform, will be overly burdensome to medical laboratories,” Robboy said. “We hope savings can be found in other ways so that patients will not be impacted.”

Agreement on the “doc fix” came shortly after House Republicans agreed to extend the payroll tax cut without offsetting its cost with other cuts. This allowed budget negotiators appointed by the Senate and House in December, to focus on cutting $50 billion rather than $$150 billion to extend all three programs: the payroll tax cut, the SGR patch, and long-term unemployment benefits. The bill also extends through year-end, the “floor” on geographic adjustments to the physician work component of the Medicare fee schedule.

As of the time of this writing, we are still awaiting bill language spelling out final details of the agreement. A vote on the bill could come as early as tomorrow or perhaps Saturday.

TC-Grandfather to be Phased Out by July 1, 2012

The TC “grandfather”, a long-standing program which CAP members have rallied to support for years, will likely be phased out by July 1, 2012. CAP has persistently demonstrated the program’s critical assistance to hospitals in rural and underserved communities, and contrasted those benefits to the relatively small savings cutting the program would bring, approximately $80 million over 10 years. Even as recently as this week, Representatives Tom Latham (R-IA) and Representative Mike Ross (D-AR), sent a letter on behalf of the TC grandfather provision (PDF, 293 K) to the Congressional conference committee chairs, co-signed by 30 members of Congress, urging a further extension of the provision.

The letter stated that three-quarters of the states would be impacted by terminating the TC-grandfather provision, with smaller and rural hospitals being affected the most. “We urge you to extend the Technical Component (TC) ‘grandfather’ provision in any final conference report, for H.R. 3630. Not doing so would be detrimental to hospitals, independent laboratories, and most importantly, the patients they serve who need access to high quality pathology services.”

“The CAP believes phasing out the TC-Grandfather is an ill-advised decision. It was not instituted to provide a benefit to pathologists, rather it was created to ensure patient care and hospital service in areas that need it most,” said Richard Friedberg, MD, PhD, FCAP, chair of the CAP’s Council on Government and Professional Affairs. “Over the past 10 years, it has helped hospitals that would otherwise not be able to provide laboratory tests and anatomic pathology services to their patients.”

In the final agreement, the TC “grandfather” provision was not the only Medicare extender to be phased out. Another extender, Section 508 which enables certain hospitals to qualify for higher Medicare payments will also be phased out. Finally, the agreement eliminates two programs immediately: mental health add-on payments and increased payments for bone density scans.

Palmetto Announces Adjustments to MolDx Program

With just one month until its controversial new Molecular Diagnostics (MolDx) reporting program was set to begin, Palmetto GBA announced a program update on February 3rd, with several important changes, including changing the program start date from March 5, 2012 to May 1, 2012.

In addition to the two-month extension, Palmetto announced it would offer its own identifier for MolDx test submissions, called the Palmetto Test indicator (PTI), as an alternative to the McKesson Z-codes initially required. The February update said the McKesson codes, which are used nationally, are preferred. The PTI codes, according to Palmetto, are unique to Jurisdiction 1, which includes California, Nevada, Hawaii and the US Pacific Territories of Guam, American Samoa and the Northern Marianas.

The update also includes a provision to permit submissions for a test identifier via a fax ‘attachment’ to an electronic claim until September 1, 2012. This means that labs whose systems are unable to include the additional information required to attain a test identifier can, until September 1, attach a newly created “MolDx Test Information Form” with each claim submission for which no test identifier has been issued.

These changes are in part a result of a meeting last month between CAP leaders and Deputy Administrator and Director for Medicare Services at CMS, Jonathan Blum and an attempt to address concerns raised by CAP, as CMS has jurisdiction over the administration of Medicare. As previously reported in Statline, the College expressed concerns about the MolDx program and requested it be delayed. The CAP is reviewing other details in the update and while determining its next steps, remains concerned with the revised MolDx Program.

Palmetto GBA announced the MolDx program in November 2011, stating it would require all claims for molecular tests in Medicare jurisdiction 1 to use a unique identifier for each test, rather than the methodology-based CPT molecular diagnostic “stacking” codes that are commonly used.

In response to concerns about variation in billing and payment using molecular diagnostic “stacking” codes, the American Medical Association’s CPT Editorial Panel developed and issued single CPT codes for the vast majority of molecular pathology services. The new CPT Codes for Molecular Pathology were devised during a 2½ year process that included CMS, other payers, providers, and several organizations including CAP. The more than 100 codes cover 90% of existing molecular tests. However, CMS delayed implementation of the new molecular codes for Medicare use until it decides whether they should be placed on the physician fee schedule or on the clinical laboratory fee schedule.

The Palmetto MolDx program includes Palmetto generating test identifiers, technology assessments of each test, reimbursement determinations, and creating a test registry.

Visit the Palmetto website to see the February update and related documents on the full program.

Pathology Organizations Reach Agreement on Policy Priorities

At a meeting hosted by CAP’s Council for Government and Professional Affairs (CGPA) Executive Committee on February 3, leaders from the nation’s leading national pathology organizations reached agreement on a number of policy priorities for pathologists and pathology in 2012.

The meeting included representatives from the American Pathology Foundation, American Society for Clinical Pathology, American Society of Cytopathology, Association for Molecular Pathology, Association of Pathology Chairs, College of American Pathologists, National Association of Medical Examiners, and the United States and Canadian Academy of Pathology.

The group identified a slate of high priority issues on which they are united. These include:

  • supporting the placement of the new molecular CPT codes onto the Medicare physician fee schedule;
  • support for legislation to relieve Pathologists from Meaningful Use penalties;
  • oversight of laboratory developed tests;
  • increased GME funding for pathology, and;
  • support for replacing the coroner’s system and a strengthening of the nation’s forensics.

“As these issues highlight, pathologists must endeavor to strike the right balance in setting advocacy priorities to ensure that our strategies are aligned for the profession’s immediate needs as well as future needs,” noted Richard C. Friedberg, MD, PhD, Chair of the CGPA. “We conduct this meeting as a forum for gaining insights, perspectives and support—this collaboration is vitally important given the current environment.”

The group has met each year for the past several years to discuss policy priorities.

CMS to Postpone ICD-10 Implementation

The Centers for Medicare & Medicaid Services (CMS) will likely postpone the implementation of the ICD-10 coding system beyond October 2013, according to remarks made by acting CMS Administrator Marilyn Tavenner at the American Medical Association (AMA) National Advocacy Conference earlier this week.

Tavenner did not provide details, but said she is committed to re-examining the pace of implementation. Over the past month, the AMA sent letters to HHS Secretary Kathleen Sebelius, and House Speaker John Boehner, outlining the pressures physicians currently face in light of health care reform and budget cuts to Medicare.

“There is concern that folks cannot get their work done around meaningful use, ICD-10 implementation, and be ready for exchanges,” Tavenner told reporters. “So we decided to listen to that and be responsive.”

A final rule extending the deadline for adopting the new codes, and possibly other aspects of the program, is expected in the next few weeks.

PQRS Update: CMS National Provider Call and New Resources for Pathologists from CAP and AMA

The Centers for Medicare and Medicaid Services (CMS) will host a National Provider Call on claims-based reporting in the Physician Quality Reporting System (PQRS) and E-Prescribing Incentive Program on Tuesday, February 21, 2012, from 1:30–3:00 pm eastern time.

The 90-minute call will feature presentations by CMS’s subject-matter experts, and will include time for questions and answers. It is open to all Medicare fee-for-service providers, medical coders, physician office staff, provider billing staff, e-health records staff and vendors.

Registration is required and will be granted on a first come, first served basis. CMS is encouraging participants to register early. Visit the CMS website for more information and registration.

New Resources From CAP and AMA

The CAP announced launch of its new “PQRS 2012 Pathology Measures” issue resource center this week. The resource center, located on the Advocacy landing page, includes updated information on the five pathology reporting measures for 2012, along with materials from the CAP’s December 2011 PQRS webinar. Also featured are the American Medical Association’s PQRS toolkits. Each AMA toolkit includes a measure description, data collection sheet, and coding specifications for that measure.

CAP Seeks Amendment to Alabama Genetic Testing Bill

The College joined forces with the Alabama Association of Pathologists last week, requesting an amendment to Alabama House Bill 78, to explicitly exclude genetic testing used for patient diagnosis and treatment from the restrictions the bill places on predictive genetic testing.

Pathologists’ main issue with the bill centers on its broad definition of “genetic characteristic” which encompasses all genetic testing, including clinical genetic testing performed to determine therapeutic options in cases of cancer and other diseases. Failing to distinguish between the two could lead the law to be in conflict with the Clinical Laboratory Improvement Amendments (CLIA) of 1988.

In one instance, the bill affords patients the right to have their DNA sample destroyed, and provides for fines up to $10,000 for any person who willfully retains an individual’s genetic information or sample. In contrast, CLIA specifically requires laboratories to retain genetic samples for mandated periods because such retention is in the best interest of the patient.

In a letter to Alabama House Representative Ed Henry (PDF, 175 KB), CAP’s Federal and State Affairs Committee Chair, Kathryn Knight, MD, FCAP, urged that state legislative body to make the distinction clear, and include the language, “Nothing in this Section shall be construed to regulate or apply to genetic testing or genetic analysis used for diagnosis and treatment of a patient.”

Statline will continue to cover this issue.

CAP, ASCP and NAME Team With Washington State Pathology Society on Autopsy Bill

The Washington State Society of Pathologists (WSSP) is working to amend legislation to permit the continued use of autopsy images for teaching and training purposes, with help from the CAP, the American Society of Clinical Pathology, and the National Association of Medical Examiners. A restriction on the use of these autopsy materials was included in an amendment to Washington State Senate Bill 6037. However, the amendment was passed out of Committee without any exclusion that allows for these images to be used for teaching or training. With support from the national groups, the WSSP is working with the bill’s primary sponsor, Senator Jerome Delvin (PDF, 181 K), to seek agreement on language to include the exclusion. The bill is expected to return for consideration in the 2013 legislative session. See the CAP policy.


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