College of American Pathologists
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June 23, 2011  •  Volume 27, Number 13
Next Issue: July 7, 2011
© 2011 College of American Pathologists

In This Issue:

MedPAC Focuses on Imaging Self-Referral in June Report to Congress
Patent Reform Bill Amendment Calls for Gene Patent Study
Help the College Identify Challenges Facing Pathologists
CMS to Hold Meetings on 2012 CLFS, New Genetic Test Codes
Meaningful Use Stage 2 Objectives Approved by ONC Policy Committee
CMS Hints at ACO Advanced Payment Proposals at Open Forum
Ill. State Pathology Web Site Turns to Social Media to Engage Members
Keep Up with the Latest CAP Advocacy News on Twitter

MedPAC Focuses on Imaging Self-Referral in June Report to Congress

The Medicare Payment Advisory Commission (MedPAC) included recommendations on improving payment accuracy for advanced diagnostic imaging services, including requiring “high-use” providers to participate in a prior authorization program, among other proposals in this year’s annual report to Congress, released last week.

This latest report by the independent Congressional agency, which advises both the Senate and House on payment issues affecting the Medicare program, adhered to physician payment reform recommendations approved at its April meeting (see Box; Statline, April 14, 2011). These recommendations stop short of narrowing the types of services covered by the Stark law’s in-office ancillary services (IOAS) exception out of concern for “unintended consequences,” such as inhibiting the development of organizations integrating coordinated care within the practice, according to the report. However, MedPAC will continue to monitor self-referral of ancillary services, including anatomic pathology testing. “Although our recommendations do not directly address self-referral of physical therapy, radiation therapy, and anatomic pathology tests, we will continue to track the growth of these services and may consider policy options to specifically address them in the future,” stated the report.

MedPAC’s June 2011 Payment Recommendations to Congress

  • The HHS Secretary should accelerate and expand efforts to package discrete services in the physician fee schedule into larger units of payment.
  • Congress should direct the Secretary to apply a multiple procedure payment reduction to the professional component of diagnostic imaging services provided by the same provider in the same session.
  • Congress should direct the Secretary to reduce the physician work component of imaging and other diagnostic tests ordered and performed by the same practitioner.
  • Congress should direct the Secretary to establish a prior authorization program for providers who order substantially more advanced diagnostic imaging services than their peers.

The MedPAC commissioners also mentioned that perhaps the IOAS exception could be changed for physicians not participating in one type of coordinated care model: accountable care organizations (ACOs). The report stated that the exception could be narrowed for physicians who are not part of an ACO that has financial incentives to improve quality and reduce the volume of unnecessary care.

CAP, AIM Response

Although MedPAC indicated it remains open to narrowing the exception, it did not recommend doing so in this recent report to Congress. While the CAP, along with other members of the Alliance for Integrity in Medicine (AIM) coalition, is pleased that MedPAC is concerned that self-referral can potentially lead to higher volume, the current recommendations fail to directly address self-referral in diagnostic imaging, anatomic pathology, physician therapy, or radiation therapy services. The key to reducing self-referral abuses, according to AIM, is removing these four services from the IOAS exception, as outlined in a joint statement released by the coalition last week. In addition to the College, AIM’s members include the American College of Radiology (ACR), the American Society for Radiation Oncology (ASTRO), and the American Society of Clinical Pathology (ASCP), among others.

In addition to expressing disappointment about failure to narrow the IOAS exception, AIM also disagreed with MedPAC’s assertion that significant changes to the self-referral law could negatively impact integrated multispecialty practices. Rather, AIM believes that there is a way to close the law’s ancillary services loophole without limiting integrated multispecialty practices. To this end, the Coalition has been working with several of these types of practices to craft a careful solution that complements their coordinated approach.

The statement also further urged Congress to consider narrowing the IOAS exception. “We urge Congress to address the rapidly growing inappropriate use of the IOAS exception to ensure that patients receive the care that is right for them, not the care that merely improves the referring physician’s bottom line,” read the statement. “Not only would removing these services from the IOAS exception represent sound health care policy, but it also could produce substantial savings to the Medicare program.”

Patent Reform Bill Amendment Calls for Gene Patent Study

Early this week, Rep. Debbie Wasserman-Schultz (D-FL), submitted an amendment to H.R. 1249, the America Invents Act, requesting the USPTO for a study and recommendations on the best ways to provide independent second opinions within the current environment of exclusive patents. The House is expected to vote on the patent reform bill sometime today, but had not done so as of press time. UPDATE: The House approved the patent reform bill by a vote of 304-117 on June 23.

Given its long-standing position against the validity of gene patents, the College and other pathology stakeholders worked with Rep. Wasserman-Schultz’s staff to clarify that this amendment is not intended to reflect Congress’s position on the validity of gene patents. These stakeholders included the American Society for Investigational Pathology (ASIP), the Association for Molecular Pathology (AMP), and the Association of Pathology Chairs (APC).

Congress Not Weighing in On Patents

A breast cancer survivor, the Congresswoman submitted a statement on the House floor supporting the amendment, adding that after testing positive for the BRCA-2 gene mutation, she had a double mastectomy and an oophorectomy to remove her ovaries.

SCOTUS to Hear Mayo Appeal in Prometheus Case

The U.S. Supreme Court granted “cert” on June 20 and will hear the appeal filed by Mayo Collaborative Services and Mayo Clinic Rochester (collectively known as Mayo) against Prometheus Labs.

The College joined other medical associations in filing an amicus brief in late April with the Supreme Court supporting this request for review of the most recent U.S. Court of Appeals for the Federal Circuit decision’s unfavorable ruling.

Mayo is challenging Prometheus’s patent claims on a method of monitoring therapeutic efficacy by measuring a patient’s metabolite blood-levels. Mayo asserts that because these methods simply involve evaluating the body’s natural responses to illness and medical treatment, they do not meet the patentable subject matter standard of section 101 of the Patent Act.

Her statement also clarified that the amendment is not intended to reflect Congress’s position on the validity of gene patents. “A provision in the Manager’s amendment simply directs a study by the U.S. Patent and Trademark Office on ways to remove barriers for patient access to second opinions on genetic testing on patented genes,” said Rep. Wasserman-Schultz in her statement. “Given ongoing court cases on the issue of gene patents, let me be clear: the study’s focus on second opinion genetic testing is not intended to express any opinion by Congress regarding the validity of gene patents.”

However, another House member took the opportunity prior to the floor vote to submit a statement opposing gene patents: Ranking Member, Rules Committee Rep. Louise Slaughter (D-NY). “Gene patents have cut off access to important tests,” said Rep. Slaughter, adding that the company with the patent rights to the BRCA1 and BRCA2 sequences charges between $3,000 and $4,000 for a single test. “Other laboratories have offered to perform the test for several hundred dollars, but are not able to do so because of the patent on those particular genetic sequences.”

The company alluded to by Congresswoman Slaughter is Myriad Genetics, and the case alluded to by Rep. Wasserman-Schultz is known as the Myriad gene patent case. The CAP is current a co-plaintiff in this case, represented by the ACLU, challenging the patentability of human DNA, specifically Myriad Genetics’ patents on BCRA1 and BCRA2 genes.

This case is still under review by the federal courts. While a federal court issued a ruling invalidating Myriad’s patent claims on BRCA1 and BRCA2 genes, the decision is currently under review by the U.S. Court of Appeals for the Federal Circuit. A decision from this court is expected soon, although ultimately, the case is expected to be decided by the Supreme Court.

Help the College Identify Challenges Facing Pathologists

The 2011 Practice Characteristics survey remains open to all practicing CAP fellows. Members are urged to participate, as this is an important way to track and report changes occurring in the practice of pathology. Data from this important survey is used by members and their practices, and CAP advocacy and transformation activities. By completing the survey, respondents are helping the College collect vital practice characteristic data and information on challenges facing pathology practices. In addition, the survey provides useful compensation and practice-related data to all CAP members.

Survey answers are kept strictly confidential and the results will only be reported in aggregate form or in a manner that does not identify information about an individual. For questions about the survey, contact Nonda Wilson, Advocacy Division, by email or by phone at 202-354-7116.

CMS to Hold Meetings on 2012 CLFS, New Genetic Test Codes

CMS will hold a July 18 information session to discuss new genetic testing codes, the agency recently announced. This session will follow the annual public meeting about the 2012 Clinical Laboratory Fee Schedule (CLFS). Both events will be held at the CMS Auditorium in Baltimore, Md.

At the annual CLFS meeting, the agency will be looking for cross-walk or gap fill recommendations. Two new CPT codes, HCPCS Level II codes, and crosswalk reconsideration requests are on the CLFS meeting agenda. Regarding the new genetic testing codes, the agency will facilitate an open discussion with the public on recommendations going forward on addressing these new codes. To facilitate discussion, the agency suggests feedback in three areas: whether these codes should be assigned to the CLFS or the physician fee schedule, the current CPT codes utilized to reflect the test steps, and how various genetic tests are similar to or different from existing laboratory tests. The College plans to make presentations at both the annual CMS CLFS meeting and the information session on the new Molecular Pathology CPT codes.

The College continues to actively engage with other provider groups and stakeholders in the development of these new Molecular Pathology CPT codes through the AMA CPT process. The public CMS information session on the new Molecular Pathology CPT codes is another opportunity to highlight the anticipated arrival of approximately 100 new Molecular Pathology CPT codes. Earlier this year, the AMA solicited feedback on these two sets of proposed CPT codes covering over 90% of the volume of current molecular pathology procedures. The proposed codes mark the biggest change in pathology and laboratory CPT coding in the last 20 years, CAP member Mark Synovec, MD, who is co-chair of the AMA Molecular Pathology Coding Workgroup (MPWG), told Statline at the time (Statline, March 17, 2011). That the AMA was soliciting feedback at such a preliminary stage of the CPT coding process was unprecedented, and indicative of a more open CPT system, he added.

Meaningful Use Stage 2 Objectives Approved by ONC Policy Committee

Stage 2 Objectives of HHS’s Meaningful Use for Electronic Health Record (EHR) program were approved by the Office of the National Coordinator’s (ONC) Policy Committee on June 8. The objectives passed by a 12-5 committee vote. Moving forward, CMS will use these objectives to implement Stage 2 of the Meaningful Use program in 2013.

In late February, the CAP submitted comments to the ONC regarding Stage 2 and Stage 3 preliminary recommendations. The comments noted that pathologists were not only currently unable to qualify for the incentives, but could be penalized for noncompliance beginning in 2015. In addition, the College noted that because the program is targeted to 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.

While the objectives have not significantly changed from this comment period, some ONC Policy Committee members raised concern at the June 8th meeting that some of these requirements could negatively impact some hospital laboratories. For example, laboratories in eligible hospitals would need to send structured electronic lab results to outpatient providers for at least 40% of received electronic orders. This could be burdensome for some testing providers, if there are HIT obstacles related to laboratory information systems (LIS) and interfaces that are not clinically integrated. The Committee also noted that regulators under the Meaningful Use program do not have authority over commercial laboratories, but only over hospitals and providers.

Certification Comments

In related news, the CAP also responded to the ONC’s HIT Standards Committee Implementation Workgroup’s request for feedback on the current Temporary Certification Program of EHR systems. In order to comply with Meaningful Use requirements, participants must use systems from vendors who received temporary certification from the ONC. The ONC is currently developing criteria for a more established certification program.

Once again, the CAP emphasized that pathologists generally do not have access to EHRs, but rather use LIS. That being said, the College also took the opportunity to comment on the complexity of test results, and how test results often go beyond numbers. “The [current] criteria listed basically only require that CLIA requirements for laboratory reports are met,” stated the CAP’s comments. “Going forward, we recommend that EHR certification criteria include requirements that laboratory result display and handling in an EHR is appropriate and flexible enough to account for the complexity of laboratory result display to support clinical interpretation and patient care.”

The comments also noted the need for laboratory involvement in computerized provider order entry (CPOE) systems. Under the Meaningful Use program rules the Committee recommended for Stage 2, eligible providers must use CPOE for orders for more than 60% of unique patients who have at least one lab test result. However, this will only be successful if the nuances of laboratory test ordering is addressed in a CPOE system, and if systems are configured to ensure proper test ordering.

“Meeting these requirements necessitates involvement of laboratory specific domain expertise on the part of CPOE system developers/vendors and organizations that are implementing such systems, respectively,” noted the CAP’s comments. “In many ways, properly configured CPOE will enhance meaningful use of the data generated by the ordering provider.”

CMS Hints at ACO Advanced Payment Proposals at Open Forum

Medicare officials said in a recent stakeholder call that any upfront funds provided through the proposed Accountable Care Organization (ACO) Advanced Payment Initiative would be in advance of future shared savings to be recouped by the agency in some manner at the end of the three-year performance period. This initiative, which closed for public comment on June 17, was proposed in response to concerns from providers who felt that lack of access to ready capital may keep them from participating in an ACO.

On the June 14 call, CMS officials said that they were soliciting provider feedback on exactly how these payments would be given out and then repaid. Specifically, some parameters the agency has established include requiring ACOs to provide a plan for how they will use these upfront funds. In terms of how the money will be distributed, the agency is considering doling out advanced payments as a monthly payment for each of ACO’s aligned Medicare beneficiaries (the minimum number of beneficiaries is 5,000). These payments would then be recouped through the ACO’s earned shared savings at the end of the performance period, which is defined by the ACO proposed rule as three years.

On the call agency officials stated that while eligible organizations would need to detail how the money would be spent, funding would not be based on specific costs needs, and would be an advance on shared savings.

IT, Staff Needs

Many stakeholders cited information technology (IT) investment and staff as the greatest hurdles to launching an ACO and the areas of greatest need for advanced payment.

Some stakeholders suggested that a hybrid model be used to distribute money—an upfront lump sum in addition to monthly payments. Many also estimated that they would need approximately 20% of the total estimated amount as an advanced payment in order to start an ACO.

One caller, Ken Lalime, Executive Director of the Connecticut State Medical Society-Independent Practice Association (CSMS-IPA), said that his members estimated they would need 4-5% of the total spend to launch an ACO. It was estimated that the return-on-investment (ROI) would be 3 to 5 years. In addition, they would need some of that money six months in advance of the initial start date. The CSMS-IPA is comprised of over 7,000 physician members and is governed by a 27 physician Board of Directors. Some local delivery models are being contemplated for ACO development programs.

The primary expenses include recruiting a medical director executive (as defined by CMS’s proposed ACO rule), as well as IT investment for information exchange. Staffing needs would also include care coordinators; the CSMS-IPA estimates they would need two coordinators per 1,000 to 1,500 Medicare patients.

One issue that Lalime cited was the potential financial impact absent savings. “As we speak with physicians, one of the concerns we have is that if this model goes forward and there were positive outcomes (engagement, quality, etc) regardless of actual creation of savings, then the entity may end up potentially having to pay back some of those infrastructure costs, under the proposed rule if not modified,” he explained.

In addition, CSMS-IPA members are worried about the short performance period—a sentiment shared by other stakeholders on the call. “The performance period is a three-year commitment, which may be the time when we see a ROI on some of our costs,” Lalime explained. “But after three years, we don’t really know what that system’s going to look like, the benchmarks will likely be changed and additional shared savings might not be available to offset any advanced payments.“

Ill. State Pathology Web Site Turns to Social Media to Engage Members

Since CAP member Stephen G. Ruby, MD, MBA, FCAP, became president of the Illinois Society of Pathologists (ISP) in January, one of his priorities has been overhauling the Web site to employ social media tools to drive member engagement.

Check Out ISP’s Revamped Site

ISP launched its new Web site in early February. ISP President Stephen G. Ruby, MD, MBA, FCAP, said that out-of-state non-ISP CAP members are invited to register for full access to the site without membership in 2011.

This Web site redesign was also prompted by a decision by the ISP Board Members earlier this year to position the state society’s resources away from education—by no longer offering CME classes—but rather on advocacy and networking initiatives. And deploying social media tools, in the form of timely blog posts (and soon Twitter) on state regulatory and legislative news and members-only discussion forums, emerged as the easiest and quickest way to pursue these initiatives, said Dr. Ruby. “Part of what I am doing is bringing the most value of ISP membership to Illinois pathologists, and I think this is through information on state advocacy news and networking opportunities,” he explained, adding that Pamela Cramer, ISP’s Executive Director, was also instrumental in supporting the Web site redesign.

Incorporating social media to the ISP’s site, Dr. Ruby also increased value in the form of additional financial support. The state society now has ongoing support from organizations like Mayo Medical Laboratories, Advantedge Healthcare Solutions, Pathwork Diagnostics, among others. Formerly, sponsorship had been for specific educational events rather than underwritten support.

Cost Savings

In addition to attracting stable supporters, the redesign of the Web site has also resulted in cost savings, said Dr. Ruby. “We have picked up some additional sponsorship money, but we’ve also saved an enormous amount of money by overhauling the Web site,” he explained. The former Web site cost approximately $1,500 a year to maintain. But Dr. Ruby estimates that after the initial software investment of about $600, the annual cost for the first three years will only total about $200 per year.

In addition, ISP has also done away with a printed newsletter that was mailed to members, which netted a savings of about $2,000-$3,000 per year. “We realized, compared to the newsletter, the site was accomplishing everything—and more—but was doing it faster and more effectively so we decided to discontinue the physical newsletter mailings,” he explained.

Instead, ISP’s advocacy leaders—Robert DeCresce, MD, FCAP, and Richard Anderson, MD, FCAP—inform Dr. Ruby about important state regulatory and legislative news, who then posts the update as a blog entry on the ISP site. A link to the blog post is pushed out to ISP members via e-mail. All of this can be accomplished within hours of events, rather than weeks later in a newsletter. This has resulted in a much more effective advocacy effort in Illinois.

Moving forward, Dr. Ruby is developing a resource showing other state society leaders how to integrate social media into their Web sites. “I want to continue engaging other ISP members so this is truly a dynamic site,” he explained. “But I also want to show other CAP members how easy it is to make social networking a part of a state society’s Web site.”

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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