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CAP Home > CAP Advocacy > STATLINE – CAP’s Biweekly Federal and State Advocacy E-Newsletter > Statline Archives > STATLINE � May 28, 2009
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  STATLINE — CAP’s Bi–Weekly Federal and
  State Advocacy E–Newsletter

May 28, 2009  •  Volume 25, Number 11
Next Issue: June 11, 2009
© 2009 College of American Pathologists

In This Issue:

Disclosure Bill Passes Nebraska Legislature Unanimously and Signed Into Law
CAP Urges CMS to Clarify PT Referral Policy at Partners in Lab Oversight Meeting
Bill to Permanently Extend for the TC Grandfather Introduced in U.S. House
CAP Joins AMA in Calling for the Repeal of the Sustainable Growth Rate Formula

Disclosure Bill Passes Nebraska Legislature Unanimously and Signed Into Law

The Governor of Nebraska signed into law May 26 legislation that requires a physician who orders but does not perform a component of the anatomic pathology service to disclose the billing costs to patients; a legislative victory strongly supported by the College, the Nebraska Association of Pathologists, and the Nebraska Medical Society.

The legislation, which passed the Nebraska legislature unanimously May 20, will require that the ordering physician disclose in any bill sent the patient or third-party payer the name and address of the physician or laboratory that performed the service, and the actual amount paid for each anatomic pathology service by the physician or laboratory that performed the service.

The law applies to any physician who does not perform or directly supervise anatomic pathology services. A violation of this law will be considered unprofessional conduct and may result in the denial, revocation or suspension of a medical license. The legislation also defines anatomic pathology services, consistent with model CAP legislation enacted in multiple states.

Nebraska is the sixteenth state to pass a disclosure law for pathology services, which now takes effect Jan. 1, 2010.

To view a complete copy of the final legislation, please visit the Nebraska
Legislature’s website

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CAP Urges CMS to Clarify PT Referral Policy at Partners in Lab Oversight Meeting

Continuing problems with Proficiency Testing (PT) Referral were discussed with the Centers for Medicare and Medicaid Services at the Partners in Laboratory Oversight meeting May 20, as the agency works to develop an interim policy to address undue consequences with unintentional PT referrals.

Hospital administrators, laboratory directors and personnel are concerned that their current standard specimen referral procedures, which are useful to control cost as well as address laboratory personnel shortages, violate the CLIA 1988 regulations.

CAP has heard from a number of laboratories that the CLIA requirement to treat PT samples in the same manner as patient samples leads to instances of unintentional PT referral largely due to the manner in which their testing departments are set up.

For example, CMS requires laboratories that perform hybridizations for HER2 Fluorescent in-Situ Hybridization (FISH) to have a CLIA certificate, even if it is the only procedure the laboratory does.

CMS considers hybridization as testing and requires certification for laboratories that only perform this type of preparation. If a PT sample is hybridized, consequently, they consider it part of the analysis. Once the PT sample is sent to the pathologist in a central laboratory to interpret, which is the customary practice with patient specimens, CMS would classify this practice as PT referral.

At the meeting May 20, Bruce Williams, MD, FCAP, chair of Commission on Laboratory Accreditation, spoke on behalf of the College urging CMS consider HER2 FISH similar to staining in histology, classifying it as part of the preparation and not the analysis.

Williams also called on CMS to define “intentional” referral in the PT referral policy.

The College will continue to work with the agency to ensure laboratories are able to utilize emerging technologies and provide quality laboratory testing without the threat of severe consequences for PT referral.

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Bill to Permanently Extend for the TC Grandfather Introduced in U.S. House

A bill has been introduced in the U.S. House of Representatives 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.

H.R. 2534, introduced by Rep. John Tanner (D-TN) and co-sponsored by Rep. Geoff Davis (R-KY), is a companion bill to the Physician Pathology Services Continuity Act of 2009, S. 947, which recently was introduced in the U.S. Senate. Both pieces of legislation seek to 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 of the provision, however, is provided in H.R. 2534, which was referred to House Ways and Means and Energy and Commerce Committees, while S. 947 has been referred to the Senate Finance Committee.

Comment On This Article

CAP Joins AMA in Calling for the Repeal of the Sustainable Growth Rate Formula

The Sustainable Growth Rate Formula should be repealed and replaced with an update system that reflects increases in physicians’ and other health professionals’ practice costs, according to a joint declaration by the College, AMA, and 60 other national healthcare organizations.

Joint Recommendations on Eliminating the SGR and Supporting Efforts to Promote Health Care Quality and Appropriateness, which was distributed to Congress, the Administration and other decision makers, calls for a realistic budget baseline for future Medicare payment updates to be incorporated in the federal budget that accurately reflects the anticipated costs of providing physicians with positive updates under a new update system.

If Congress and the Administration choose to adopt a transitional approach, the statement reads, it should:

  • Establish by law a transition pathway to complete replacement of the SGR by 2015.
  • Provide stability and predictability with positive, funded updates from 2010-2015 set by statute and linked to the Medicare Economic Index (MEI) for each year until a replacement takes effect.
  • Establish a realistic baseline for Medicare spending on physician services that eliminates the assumption that SGR-driven cuts will be implemented, thereby greatly reducing the score assigned to legislation to repeal the SGR.
  • Use regulatory authority to remove physician-administered drugs from the SGR from 1996 on to help reduce the cost of repeal.
  • Use regulatory authority to adjust the Medicare Economic Index to include all the costs of a current medical practice and use realistic productivity assumptions.

Also included in the statement are recommendations for strengthening resources, transition to new payment models, promoting appropriate and effective care, improving quality reporting and incentives, as well as the appropriate use of medical services.

To read the complete recommendations, visit the CAP Advocacy Website under Letters to Policymakers (PDF, 48 K).

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