College of American Pathologists
Printable Version

  STATLINE — CAP’s Bi–Weekly Federal and
  State Advocacy E–Newsletter

March 3, 2011  •  Volume 27, Number 5
Next Issue: March 17, 2011
© 2011 College of American Pathologists

In This Issue:

Missouri Rep. Carnahan Tours St. Louis’ Pathology Services
MedPAC to Take Aim at Self-Referral through Payment Reforms
CAP Submits Stage 2 Meaningful Use Comments to ONC
CMS to Begin Reprocessing Delayed Claims—at a Measured Pace
CAP Recommends OIG Exclude Labs from EHR Safe Harbor
Save-the-Date: CAP 2011 Annual Policy Meeting in D.C., May 2-4, 2011
Keep Up with the Latest CAP Advocacy News on Twitter

Missouri Rep. Carnahan Tours St. Louis’ Pathology Services

CAP member James Miller, MD, FCAP, led Congressman Russ Carnahan (D-MO) on a Feb. 14 tour of Pathology Services, Inc. in St. Louis. Owned and operated by Dr. Miller, Pathology Services is an independent laboratory specializing in surgical pathology and cytology with locations in Missouri and Illinois.

Lab tours are an important advocacy initiative organized by the College’s Pathology Advocacy Network, or PathNET. Join PathNET here. Members interested in hosting a laboratory tour for a member of Congress should call CAP’s Legislative Assistant, Federal Affairs, Davon Gray at 202-354-7124.

MedPAC to Take Aim at Self-Referral through Payment Reforms

The Medicare Payment Advisory Commission (MedPAC) continues to focus on reigning in the growth of abusive business practices related to in-office ancillary services—particularly imaging services—through payment reforms. However, recent draft recommendations from the Commission concerning self-referral stop short of removing pathology and other diagnostic testing or designated health services from the in-office ancillary services (IOAS) exception to the Stark law.

Removing these services from this exception is the key to reducing self-referral abuses, according to the CAP and other members of the Alliance for Integrity in Medicine (AIM). The College is a member of the AIM, a coalition whose members also include the American College of Radiology, the American Society for Radiation Oncology (ASTRO), and the American Society of Clinical Pathology. The AIM is focused on closing the self-referral “loophole”, based on concerns about abuse of four services under the IOAS exception: advanced imaging, anatomic pathology, physical therapy, and radiation therapy.

MedPAC, an independent Congressional advisory board, is currently in the midst of drafting recommendations for its June 2011 report to Congress. At the most recent meeting on Feb. 23, one of the Commission’s senior analysts, Ariel Winter, outlined four draft approaches to the self-referral issue. The intent of these recommendations is to improve payment accuracy and appropriate use of services:

  1. Combining discrete services into larger units of payment (i.e., packaging and bundling).
  2. Reducing payment rates for the professional component of multiple imaging studies done in the same session.
  3. Reducing payment rates for imaging and other diagnostic tests done by self-referring physicians.
  4. Requiring prior authorization for physicians who order significantly more advanced imaging than their peers.

While a majority of the Commissioners opposed any prior authorization requirement, they generally supported the first three recommendations. Winter also clarified that the third recommendation—reducing payment for tests done by self-referring physicians—could be revised to apply to other diagnostic tests, including anatomic pathology. “The rationale for this policy is that there are likely to be efficiencies in physician work when a diagnostic test is ordered and performed by the same physician,” he explained.

Exception Issues

While appreciative of MedPAC’s efforts to curb overutilization of ancillary services by self-referring providers, the AIM commented that the recommendations do not address the true problem, which is that these arrangements create incentives for overutilization of services without benefiting patients. “Our concern is that the solutions proposed do not get at the root of the problem, which is the loophole in the self-referral law, the exception for radiation therapy, physical therapy, pathology, and advanced diagnostic imaging,” said ASTRO’s Assistant Director of Government Relations David Adler, speaking at the February meeting on behalf of AIM members.

However, analyst Winter noted that narrowing the exception is prompting some concern among MedPAC commissioners about unintended consequences. “Several commissioners have expressed concern that limiting the types of services or physician groups that are covered by the in-office exception could have unintended consequences such as inhibiting the development of integrated delivery systems,” he explained at the meeting.

CAP Submits Stage 2 Meaningful Use Comments to ONC

As HHS prepares for the next phase of the Meaningful Use Electronic Health Record (EHR) Incentive final rule, the College recently submitted comments to the Office of the National Coordinator (ONC), emphasizing concern that pathologists are not only currently unable to qualify for the incentives, but could be penalized for noncompliance beginning in 2015.

The comments signed by CAP President Stephen N. Bauer, MD, FCAP, were in response to preliminary recommendations for Stages 2 and 3 from ONC’s Health Information Technology Policy Committee (HITPC). The comments also follow the January meeting between CAP leaders and agency officials about the potentially negative impact that this final rule could have on pathologists (Statline, Jan. 20, 2011).

Meaningful Use Update

  •  CMS is expected to release final
     Stage 2 Meaningful Use
     recommendations this summer.

  •  A permanent technology certification
     program is now in effect; the temporary
     program will sunset on Dec. 31 or later.

  •  Eligible providers can now register
     through CMS.

One of the College’s primary concerns, as outlined by Dr. Bauer to the ONC, is that because the rule is targeted toward office-based physicians—especially primary care providers—pathologists will face penalties for mandates that they cannot comply with for a number of reasons, including their scope-of-practice, typical interactions with patients (not usually face-to-face), and their use of EHRs. For example, pathologists often do not have complete access to EHRs. They typically use laboratory information systems (LIS) and anatomic pathology information systems (APIS), which are not sufficient in and of themselves to meet the requirements of the American Recovery and Reinvestment Act of 2009 (ARRA) rules. Therefore, pathologists—regardless of practice setting—cannot meet the MU requirement to maintain 80% of patient records in certified EHRs.

Structured Data

These concerns are evident in the College’s comments about specific Stages 2 and 3 objectives. For example, one preliminary objective is incorporating lab results as structured data, as noted below.

Objective: Incorporate Lab Results as Structured Data
Stage 1 Final RuleProposed Stage 2Proposed Stage 3
Incorporate lab results as structured data (40%)*,

(Stage 1 Menu Option)
Move current measure to core set of measures, but only where results are available90% of lab results electronically ordered by EHR are stored as structured data in the EHR and are reconciled with structured lab orders, where results and structured orders available

Because “structuring” laboratory data into EHRs is complicated, the College noted that there could be dangers to the quality of care and patient safety if users do not properly implement this requirement. “While standards exist for messaging (HL7) and nomenclature (SNOMED and LOINC), standards for the stored structure of lab data itself is more nebulous, especially outside the realm of routine general labs,” noted the comments.

The College also noted that the lack of a standard LIS-EHR interface is a significant obstacle for many laboratories trying to meet this requirement. Particularly for providers based outside of a hospital setting, customized interfaces would need to be integrated. These interfaces would have to operate across care settings, and among multiple lab and EHR vendors, making the interfaces expensive to implement, test, and maintain. The CAP suggested the development of additional standards to avoid the expense of this IT customization.

Read the CAP’s entire comment letter to ONC.

CMS to Begin Reprocessing Delayed Claims—at a Measured Pace

The Centers for Medicare & Medicaid Services (CMS) are set to begin reprocessing millions of claims affected by the implementation of the Affordable Care Act (ACA), changes to the 2010 Physician Fee Schedule (PFS), and claims related to the temporary physician payment cut when SGR expired last year. However, CMS officials are warning that it will take months to complete the reprocessing due to the volume of claims.

“These claims will not all of a sudden be reprocessed,” said CMS official Stewart Streimer, at a Feb. 22 Provider Open Door Forum sponsored by the agency. “We are doing this in a way that doesn’t jeopardize the processing of current claims.” CMS officials are also asking providers not to resubmit claims, as they will likely be denied due to duplication.

Streimer estimated there are “hundreds of millions” of claims that need to be reprocessed. These are claims that were affected by the temporary physician payment cut in June (prior to the passage of another “doc fix”), as well as certain provisions of the ACA that were implemented after their effective date. In addition, there are corrections to the 2010 Medicare PFS that were implemented at the same time as the ACA, but with an effective date retroactive to Jan. 1, 2010. Claims impacted by these adjustments will also be reprocessed.

Providers should expect payment for their reprocessed claims to be included in their scheduled payments. “We will aggregate claims until the next scheduled payment rather than issue separate payments for each reprocessed claims,” said Streimer.

Last December, the CAP signed on to a letter urging HHS Secretary Kathleen Sebelius to expedite reimbursement to physicians for any payment issues related to the ACA.

CAP Recommends OIG Exclude Labs from EHR Safe Harbor

The College recently recommended to the Office of the Inspector General (OIG) that laboratories no longer be protected donors under the electronic health record safe harbor of the federal anti-kickback statute. This position is based on the negative impact that these donations have on the appropriate utilization of services, as well as quality and cost of services provided, outlined CAP member Gerald R. Hanson, Chair of the Professional Affairs Committee, in a Feb. 25 letter to Inspector General Daniel R. Levinson.

The College submitted these comments in response to the OIG’s annual solicitation for proposals and recommendations to develop new—as well as modify current—safe harbor provisions under the federal anti-kickback statute.

The CAP has long been concerned about using EHR donations as an abusive business practice. Furthermore, there appears to be a recent increase in requests to pathologists for EHR donations, according to reports from CAP members.

This uptick is largely a result of regulatory and financial influences; specifically, the HHS’s Meaningful Use rule implementing the requirements of the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act. The current Meaningful Use rule requires that EHR systems be certified in order to qualify for current financial incentives through 2014, and avoid financial penalties for not meeting these requirements beginning in 2015 (see related article). “These requirements, while clearly designed to expedite EHR adoption, have also served to increase not only the volume of EHR donation requests received by pathologists, but also the tactics employed and tone associated with such requests,” wrote Dr. Hanson.

The CAP’s comments also illustrated that at least one state is excluding clinical laboratories from being protected donors under EHR safe harbor provisions. Last year, the New York’s Department of Health clarified that state law prohibits laboratories from donating EHR products and services to health care providers. In a Sept. 27 advisory letter to laboratory providers in New York, state officials also emphasized that they were aware of abusive business practices offering EHR systems.

Following this communication, state officials announced a 90-day amnesty period between Jan. 15 and Apr. 15, 2011, according to a Feb. 11 document issued by the agency. This document indicated that after Apr. 15, those found violating this aspect of the state’s anti-kickback statute—even if they were in compliance with federal EHR safe harbor provisions—would be subject to civil or criminal penalties. Noncompliant donors could also be subject to administrative action. For example, officials could deny state permit applications.

Both of these documents from the New York Department of Health, are available online for reviewing.

Save-the-Date: CAP 2011 Annual Policy Meeting in D.C., May 2-4, 2011

The College’s Annual Policy Meeting will be held on May 2-4 at the Four Points by Sheraton in Washington, D.C. Don’t miss this unique opportunity for CAP members to get “up close and personal” with a variety of influential Washington, D.C., officials and legislators who are impacting health policy and the practice of medicine. Registration details to follow.

Keep Up with the Latest CAP Advocacy News on Twitter

CAP Advocacy is now on on Twitter. Follow CAP Advocacy’s daily “tweets” to keep pace with regulatory and legislative news affecting the pathology industry. For the latest health care news, be sure to check out the what we are following on Twitter.


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