College of American Pathologists
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May 14, 2009  •  Volume 25, Number 10
Next Issue: May 28, 2009
© 2009 College of American Pathologists

In This Issue:

Photo: 2009 CAP Advocacy School Participants
CAP Joins Landmark Lawsuit Challenging Legality of Myriad Genetics Gene Patents
CAP Seeks Reconsideration of CMS Rejection of Warfarin Testing Validity
Court Finds Lab Directors Not Liable for Medicaid Payments to Labs Where They Served
New York and California Consider Genetic Testing Exemption Legislation
Legislation to Permanently Extend TC Grandfather is Introduced in Senate
Red Flags Rule Update: Good News for Pathologists
Pathologists Convene on Capitol Hill for 2009 CAP Advocacy School and National Lobby Day
Future of Pathology in Healthcare Reform Key Issue at State Society
Leadership Conference


Photo: 2009 CAP Advocacy School Participants

2009 CAP Advocacy Scool ParticipantsMore than 60 pathologists visited the Capitol building, letting Congress hear the voices of pathologists, during 2009 CAP Advocacy School, May 4-6, 2009.

Read more about the activities that took place, the guest participants involved, and more, during the three-day event that set an record for all-time attendance.

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CAP Joins Landmark Lawsuit Challenging Legality of Myriad Genetics Gene Patents

The College joined a lawsuit May 12 against the U.S. Patent and Trademark Office and Myriad Genetics, challenging the legality of Myriad’s patents for the genes known as BRCA1 and BRCA2, which are indicators for hereditary predisposition to breast and ovarian cancer.

According to CAP, as a result of these patents, patients have been adversely affected because Myriad restricts most laboratories from providing full gene testing, requiring patients and their physicians to rely solely on Myriad to provide the test.

“As medical specialists in the diagnosis of disease, pathologists have a keen interest in ensuring that gene patents do not restrict the ability of physicians to provide quality diagnostic services to the patients they serve,” said CAP spokesperson, Dr. Jeffrey A., Kant MD PhD, immediate past Chair of CAP/ACMG Biochemical and Molecular Genetics Resource Committee and Professor of Pathology and Human Genetics at the University of Pittsburgh Medical Center.

“When patents are granted, a single-lab only is authorized to do the test unless the test is licensed to other labs. In these cases, high licensing fees can be so prohibitive they prevent physicians and other laboratories from providing diagnostic services or developing improved tests,” Kant said.

The complaint cites specific cases where patients were directly impacted because the diagnostic test services were not readily and affordably accessible.

The College has long opposed the issuance of human health-related gene patents because the doing so in violates the principle restricting patents on laws of nature. Patenting human health-related gene patents limits access to medical care, jeopardizes the ability to practice medicine in the best interest of patients and raises the cost of care.

The lawsuit was filed by the American Civil Liberties Union and the Public Patent Foundation in the United States District Court for the Southern District of New York on Tuesday, May 12, 2009.

The College is joined by nineteen other plaintiffs in the lawsuit including patient advocates, cancer patients, individual clinicians, and other medical societies.

To view the legal challenge, please visit the CAP website (PDF, 821 K), or view previous Congressional testimony (PDF, 37 K) outlining the College’s position on the Advocacy website, under Testimony to Congress.

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CAP Seeks Reconsideration of CMS Rejection of Warfarin
Testing Validity

The College of American Pathologists will continue to work with the Centers for Medicare and Medicaid Services in support of the clinical validity and utility of pharmacogenomic testing for warfarin in predicting variability in patients’ response to therapy with the metabolism, after a draft proposal released May 5 from the agency rejected evidence of its benefits.

The CMS proposal contradicts the Food and Drug Administration’s review of in-vitro diagnostic test kits for warfarin pharmacogenomic testing that received FDA approval in 2008—data that demonstrates safety and efficacy.

“If the proposal is finalized, it will be a major blow to personalized healthcare. While a prospective clinical trial is in progress, funded by the National Heart, Lung and Blood Institute, several prospective studies already have demonstrated improvement in the time to achieve a therapeutic warfarin level, with decreased time out of range during which the risk of unwanted bleeding events is highest,” states Debra Leonard, MD, FCAP, Professor and Vice Chair for Laboratory Medicine at Weill Cornell Medical College.

CAP advised CMS in comments September 3, 2008, outlining the clinical validity and utility of pharmacogenomic testing for warfarin dosing. The comments included recent findings issued by the Brookings Center summarizing the likely improvements in patient outcomes and healthcare cost savings in pursuing a strategy utilizing pharmacogenomic testing prior to initiation of warfarin therapy to guide dosing.

Despite the evidence, however, CMS instead proposed that pharmacogenomic testing to predict warfarin responsiveness is not reasonable and necessary under §1862(a)(1)(A) of the Social Security Act.

“We will continue to seek discussions with CMS in hopes that we can redirect CMS thinking on the need to act promptly to adopt contemporary practices which are in patients and societies best interest,” said Louise Wright, MD, FCAP, co-chair of the CAP Council on Government and Professional Affairs Molecular Pathology Working Group.

The College looks forward to working with CMS to determine the validity and utility of pharmacogenomic testing for warfarin, or to delay a final decision until the completion of the clinical trial which is already underway, sponsored by the National Heart, Lung, and Blood Institute.

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Court Finds Lab Directors Not Liable for Medicaid Payments to Labs Where They Served

A recent California court ruled that laboratory directors are not liable for Medicaid over-payments to the labs where they serve, overturning a previous ruling that would have held one pathologist liable for millions of dollars.

The decision came after Kazou Yamazaki, MD, filed a petition for Writ of Administrative Mandamus against the California Department of Health Services, the state agency responsible for the Medicaid program, seeking to overturn a previous Administrative Law Judge ruling that ordered him to repay $6.4 million in overpayments provided to two now-defunct laboratories where he was director.

The Court ruled (PDF, 84 K) in favor of Dr. Yamazaki, finding DHS could not recover an overpayment from a provider unless the provider received an overpayment—which in this case, Dr. Yamazaki did not because payments were issued to the laboratory.

DHS, the Court determined, abused its discretion in concluding he is liable to repay the overpayments received by the two laboratories.

CAP applauds this decision, which removes what could have been a powerful disincentive for pathologists to serve as lab directors of enrolled Medi-Cal providers.

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New York and California Consider Genetic Testing
Exemption Legislation

The College and respective state pathology societies have taken opposition to recently introduced legislation in California and New York that would exempt certain genetic testing services from state regulatory requirements applicable to clinical laboratories.

The legislation—California Senate Bill 482 and New York Senate Bill 5190—specifically exempts from laboratory regulations those laboratories that provide “biological data analysis services,” a shift which would undermine current California and New York State law, and potentially federal law under CLIA.

The California bill passed the Senate Health Committee by a vote of 7-1 on April 27.

Joint letters of opposition from CAP and both the California Society of Pathologists (PDF, 606 K) and the New York State Society of Pathologists (PDF, 589 K) highlight the legislation’s attempt to circumvent CLIA and existing state laws, while also noting “the proposed new policy scheme for certain genetic tests is based upon an artificial distinction and untenable premise that such testing does not entail medical diagnostics.”

“These laws protect the public and promote quality in testing, including genetic testing,” stated Jared Schwartz, MD, FCAP, president of the College. “Such an approach to this testing, as has been proposed, undermines the necessary and reliable regulatory framework upon which genetic and other forms of clinical laboratory testing are currently delivered and does not promote quality.”

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Legislation to Permanently Extend TC Grandfather is Introduced in Senate

Legislation has been introduced in the U.S. Senate to permanently allow independent laboratories to continue to receive payment from Medicare for the technical component (TC) of pathology services provided to hospital inpatients and outpatients.

The Physician Pathology Services Continuity Act of 2009, introduced by Sen. Blanche Lincoln (D-AR) and co-sponsored by Sen. Pat Roberts (R-KS), would ensure that hospitals can continue to rely on independent laboratories to provide surgical pathology services to patients without disruption and increased costs.

In 1999, CMS issued a notice that Medicare would no longer pay independent laboratories for the technical component of pathology services provided to hospital inpatients and outpatients. The “grandfather” exemption applies to services delivered to any hospital that used an independent laboratory for TC services as of July 22, 1999, the date the CMS proposed eliminating this payment arrangement.

To date this payment change has not been fully implemented because the College has successfully won passage in Congress of a series of temporary TC “grandfather” exemptions.

A permanent extension, however, is provided in the Physician Pathology Services Continuity Act of 2009, S. 947, which has been referred to the Senate Finance Committee.

The College applauds the leadership of Senator Lincoln in introducing this important legislation that would provide the stability independent laboratories and hospitals need to maintain services vital to Medicare beneficiaries.

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Red Flags Rule Update: Good News for Pathologists

While the Federal Trade Commission continues to include physicians in its definition of “creditors” required to implement written identify theft prevention and detection programs, an official from FTC has indicated that most pathology practices are considered to be at low risk for identify theft.

This good news followed shortly after the FTC’s release of guidelines for low risk organizations to implement do-it-yourself identify theft programs.

Not all pathology practices may qualify as low risk organizations. Ask your legal counsel for advice and/or read the FTC booklet, Fighting Fraud with the Red Flags Rule: A How-To Guide for Business.

In November 2007, the FTC issued a set of regulations, known as the Red Flags Rule, requiring that certain entities known as “creditors” develop and implement written identity theft prevention and detection programs to protect consumers from identity theft.

After several extensions, the rule is set to take effect on August 1, 2009. CAP supports AMA’s efforts to utilize this time to continue to object to the FTC and Congress that physicians are not “creditors” and therefore should not be subject to this rule.

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Pathologists Convene on Capitol Hill for 2009 CAP Advocacy School and National Lobby Day

2009 CAP Advocacy School “This is the year healthcare reform will shape our profession for decades to come,” said Richard Gomez, MD, FCAP, chair of CAP’s Federal and State Affairs Committee, and Chair of the College’s 2009 Advocacy School and National Lobby Day.

“There’s no better time to unite here in Washington, D.C. to make certain that the voices of pathologists are heard.”

And heard we were. More than 60 CAP fellows and residents converged on Capitol Hill last week to educate lawmakers on the need for pathology to play a central role in diagnostics and patient care.

CAP Advocacy School, held May 4-6, combines in-depth training in grassroots advocacy, discussion of the key policy issues that shape CAP’s legislative agenda, and meetings with Congressional leaders, CAP members and staff.

“If pathologists don’t tell their story to decision makers, no one will do it for us,” Gomez said, “that makes it critical that pathologists from around the country, throughout different points in their careers, come together and take our seat at the table.”

Guest speakers from Capitol Hill also discussed healthcare reform with participants, including Representative Mark Kirk (R-IL), member of the House Appropriations Committee, Representative Jim McGovern (D-MA), vice chairman of the House Rules Committee, Representative John Lewis (D-GA), member of the House Ways and Means Committee, and Representative Greg Walden (R-OR), member of the House Energy and Commerce Committee.

National Lobby Day Before meeting with lawmakers on the Hill, participants attended a full day of presentations on building relationships with elected officials, briefings on the CAP legislative agenda, and best practices for hosting Congressional laboratory tours.

Advocacy School concluded with CAP’s National Lobby Day, when the pathologists held more than 200 scheduled meetings with their Senators, Representatives, and their staffs to advocate for legislative action to permanently fix the flawed Sustainable Growth Rate formula, and discuss the unique diagnostic and consultative role pathologists can play in patient-centered personalized care models, such as the medical home.

“Prior to this week, some of the residents were anxious about meeting with our congressional representatives for the first time,” said Marian Kraemer, MD, a resident at the University of Alabama and first time National Lobby Day participant. “Advocacy School prepared us well for our meetings, though, and we feel we were able to successfully deliver our message.”

The College encourages all members to become politically active. Although attending the annual Advocacy School is a great place to start, members can utilize the valuable resources on the CAP Advocacy website throughout the year, and for further information can contact Susan Askew, CAP Manager of Political Programs, at 800-392-9994 ext. 7105.

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Future of Pathology in Healthcare Reform Key Issue at State Society Leadership Conference

The changing landscape of pathology and healthcare reform took center stage at the fourth annual State Pathology Society Leadership Conference hosted by the College May 7 – 8 in Washington, D.C.

2009 Leadership Conference State Society presidents representing 27 states united for the conference, which included presentations from CAP leadership and staff, as well as panel discussions on how pathologists can collaborate on the state and federal level and achieve “revolutionary goals with evolutionary steps.”

“Dramatic change is headed for physicians, though it’s important to remember that innovation and change are nothing new to pathologists,” said CAP president-elect Stephen Bauer, MD, FCAP. “Now is the time for CAP members and state societies to develop state-level programs, because this is the year healthcare reform will shape our profession for a generation to come.”

Charles Roussell, executive vice president of the College, outlined the strengths and resources that CAP can deliver to help state societies reach these goals, including advocacy strategy and support, education, technical capability and proven resolve.

“I learned two important lessons early on,” said Mr. Roussel. “First, what happens at the state level is extremely important. Second, there’s strength in numbers, especially when collective voices resonate with a clear, consistent, and compelling argument.”

“If pathology is going to continue to be a powerful player in healthcare reform,” he followed, “then together we must act.”

The College has provided State Advocacy support in 44 states since 2001, with almost 200 separate actions on more than 30 different public policy issues.

Along with public policy panel discussions, state leaders were given an update on the state of the College, its federal public policy positions, and the future of pathology.

In addition to Dr. Bauer, key speakers included the College’s senior leaders in public policy: Jared Schwartz, MD, PhD, FCAP, president of the College; Andrew Horvath, MD, FCAP, chair of the CAP Council on Government and Professional Affairs; and Richard Gomez, MD, FCAP, chair of the CAP Federal and State Affairs Committee.

Senior members of the CAP staff were also on hand, including Mr. Roussel, and Mr. John Scott, vice president of Advocacy.

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