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CAP Home > CAP Advocacy > STATLINE – CAP’s Biweekly Federal and State Advocacy E-Newsletter > Statline Archives > STATLINE � June 25, 2010
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  STATLINE — CAP’s Bi–Weekly Federal and
  State Advocacy E–Newsletter

June 25, 2010  •  Volume 26, Number 13
Next Issue: July 8, 2010
© 2010 College of American Pathologists

In This Issue:

Obama Signs 6-Month SGR Patch with 2.2% Update Until Year End
FDA to Hold July Public Meeting on LDT Oversight
Self-Referral Update: CAP Meets with CMS Officials
Myriad Genetics Appeals Gene Patent Decision
Pathology Leaders Testify at AMA Meeting on Personalized Health Resolutions
AFIP Announces Plans to Cease Civilian Consultations on Sept. 30
National HIT Coordinator Establishes Temp EHR Certification Program
SACGHS Issues DTC Testing, Genetic Education Training Recommendations
2010 PQRI Reporting Period Begins July 1
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Obama Signs 6-Month SGR Patch with 2.2% Update Until Year End

This morning, President Obama signed H.R. 3962, The Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010, which replaces the 21% Sustainable Growth Rate (SGR) cut with a 2.2% update retroactive to June 1 through November 30, 2010. The House of Representatives approved the law by a 417 to 1 vote last night following a week of intense debate because the bill did not contain the other tax breaks and unemployment benefit extensions included in the “jobs bill” originally passed in the House before Memorial Day. The Senate, however, continues to struggle to pass the remaining portions of the “jobs” bill due to concerns related to the bill’s impact on the federal deficit.

Shortly after the President signed the bill, CMS announced that Medicare contractors would discontinue processing claims at the negative update rates and to temporarily hold all claims for services rendered on June 1 or later, until the new 2.2 percent update rates are tested and loaded into their claims processing systems. “We expect to begin processing claims at the new rates no later than July 1, 2010,” read a CMS statement. “Claims for services rendered prior to June 1, 2010, will continue to be processed and paid as usual.”

Those claims already processed at the negative update will be automatically processed as soon as possible. Providers should not resubmit claims already submitted to their Medicare contractor, according to CMS.

FDA to Hold July Public Meeting on LDT Oversight

The FDA is holding a two-day public meeting on the oversight of laboratory-developed tests (LDTs) on July 19 and 20. Earlier this month, the agency sent letters to direct-to-consumer (DTC) genomic companies including 23andMe, Navigenics, Knome, and Illumina, stating that their tests are on the market without the appropriate premarket review and approval. The FDA is also reportedly dropping plans to issue a final guidance on the oversight of in vitro diagnostic multivariate index assays (IVDMIAs) in favor of addressing overall LDT oversight.

The decision to host the July meeting suggests that FDA will assume a more active role in overseeing the production and distribution of LDTs, and that it will provide guidance on how labs can remain in compliance when using these tests, according to Gail H. Vance, M.D., Professor of Medical and Molecular Genetics at the Indiana University School of Medicine . When asked to predict the agency’s approach to guidance, Dr. Vance told Statline, “I think the FDA will produce a guidance that will be risk-based and may mirror their current Class I-III categorization.”

While Dr. Vance believes that current oversight of LDTs under CLIA is adequate for the majority of LDTs, there are tests that require greater scrutiny. But she cautioned against taking an overly onerous approach to oversight. “Whatever final decision the FDA designs, it should not create an undue burden for the majority of labs that produce LDTs as a service to their physicians and patient community,” she explained.

CAP intends to provide testimony at this FDA meeting. The College proposed an LDT oversight model in February 2009.

Self-Referral Update: CAP Meets with CMS Officials

Earlier this week, CAP met with CMS leaders to discuss the significant costs and quality concerns associated with inappropriate self-referral arrangements and anatomic pathology (AP) testing services. CAP and other members of the in-office ancillary services exception (IOAS) Coalition have asked that AP services be removed from the IOAS exception because these services cannot be completed in time to aid in the physician’s diagnosis while the patient is in the office.

The Medicare Payment Advisory Commission (MedPAC) is also acknowledging the role of the IOAS exception under the Stark law in the rapid volume growth of services permitted under the IOAS exception. The June MedPAC report specifically lists laboratory services as among those services contributing to the increase of Medicare’s growing financial burden on taxpayers and beneficiaries over the past five years. In this recent report, the commission encouraged CMS to “move away from payment policies that encourage service volume” in favor of establishing new payment models and delivery systems that reward providers for constraining growth while improving the quality of care. The report also analyzed Medicare claims data from 2008 on the frequency of same day services—such as diagnostic lab testing—that are covered by the IOAS as defined by the Stark law. MedPAC analysis concluded that fewer than half of clinical lab tests are performed on the same day as an office visit.

Myriad Genetics Appeals Gene Patent Decision

Myriad Genetics has filed an appeal to the April federal court decision invalidating patents on genes BRCA 1 and BRCA 2—the basis of the company’s lucrative BRACAnalysis testing services.

This appeal was inevitable and a reminder of the long litigious road ahead for this case, said Dan Vorhaus, Editor of the Genomics Law Report blog and an attorney specializing in genomic and biotechnology issues at Robinson, Bradshaw & Hinson, in Charlotte, N.C. “It will likely be at least a year before we have a final ruling on the validity of Myriad’s patents, and possibly much longer than that, especially if the case is successfully appealed to the Supreme Court,” he explained. “While we await a final resolution, the real significance of the Myriad case is the degree to which it has spurred a much broader discussion about the appropriate role of patents, including gene patents, in biotechnology.”

One factor that will influence the future of this issue is the U.S. Supreme Court’s forthcoming decision on patents and methods issues in Bilski v. Kappos (Statline, 4/29/10) which could impact Myriad’s patent on its testing method. In addition, the Secretary’s Advisory Committee on Genetics, Health, and Society (SACGHS) April report on gene patents featured numerous recommendations, including infringement liability exemptions for certain gene patents and ensuring equal access to clinically useful genetic tests.

“The Myriad case, the Supreme Court’s imminent decision in Bilski, and the recent SACGHS report on gene patents reflect that as biotechnology companies and researchers continue to innovate, patent law—as with other areas of law and regulation—is struggling to keep pace,” said Vorhaus.

Pathology Leaders Testify at AMA Meeting on Personalized Health Resolutions

At the recent AMA House of Delegates meeting in Chicago, pathology leaders and Pathology Section Council (PSC) members testified on issues relating to gene patents, accessibility of gene testing, and genomic-based personalized medicine. Specifically, the College commented that while there have been advances in genetic testing, clinical implementation remains a challenge. Pathologists play a key role in advising on the appropriate use of personalized medicine, not just for choosing the appropriate diagnostic test but also for selecting treatments, testified LoAnn C. Peterson, M.D. a delegate from the American Society for Clinical Pathology and PSC member. CAP also expressed concerns about the July 6th implementation of CMS’s Provider Enrollment, Chain and Ownership System (PECOS). This July implementation—rather than the initial January 2011 date—could have a serious negative financial impact for physicians and laboratories who provide services to Medicare patients referred to them by physicians who are not enrolled or re-enrolled in the Medicare program, according to the College.

CAP delegates also met with AMA trustees and President-Elect Peter W. Carmel, M.D., a pediatric neurosurgeon from Newark, N.J. “We presented Dr. Carmel and the trustees with the pathology transformation plan to let the House of Medicine know that pathology is undergoing this process,” said CAP Delegation Chair William V. Harrer, M.D.

Dr. Harrer also noted that CAP delegates met with hospital-based physicians in state coalitions to discuss potential responses to new health care delivery models like accountable care organizations (ACOs). “We’re definitely making some headway there,” he added.

AFIP Announces Plans to Cease Civilian Consultations on Sept. 30

The Department of Defense’s (DoD) Armed Forces Institute of Pathology (AFIP) has announced that after Sept. 30 it will no longer accept non-federal civilian consultation cases. The announcement signals the beginning of AFIP’s phased reduction. The operation is slated to close permanently by Sept. 15, 2011, as a result of the 2005 Defense Base Realignment and Closure Law (BRAC).

CAP, with the cooperation of a coalition of medical societies and physician groups including the American Society for Clinical Pathology and Association for Molecular Pathology, has urged Congress to preserve the key functions of the AFIP—including the National Pathology Tissue Repository and secondary consultation services. A 2008 law shifted these functions to a new Joint Pathology Center (JPC) at the new Walter Reed Medical Center, located on the campus of the National Naval Medical Center in Bethesda, Maryland. However, the DoD has been reluctant to provide clear details regarding the scope and responsibilities of the JPC, prompting concern about the future of the facility. While CAP and the Coalition to Preserve the AFIP successfully advocated for a measure within the 2009 Emergency Supplemental Defense Appropriations bill to temporarily prevent the DoD from disestablishing the AFIP before submitting plans to create the JPC, this language expired in October 2009 without any understanding of the JPC’s operations.

In April, Rep. Maurice Hinchey (D-NY) requested details from DoD officials on the JPC’s responsibilities, scope, and budget at a House Appropriations Committee Subcommittee on Defense hearing. Similar questions on this issue were also added to the Congressional record by Representatives Steve Rothman (D-NJ) and Sanford Bishop (D-GA). As of now, the DoD hasn’t communicated their response to Congress, fueling continuing concern about the future of AFIP operations. CAP, along with its coalition partners, continue to work with the House Defense Appropriations Subcommittee in attempting to learn more detailed plans about the JPC.

National HIT Coordinator Establishes Temp EHR Certification Program

The Office of the National Coordinator for Health Information Technology (ONC) will establish a temporary certification program for electronic health record (EHR) technology, according to a recently announced final rule.

Financial incentives for HIT systems are part of the American Recovery and Reinvestment Act. However, in order for professionals and hospitals to be eligible to receive payments under the incentive programs, they must demonstrate meaningful use of a certified EHR system. In related news, CMS has launched the official Website with detailed information on the EHR incentive programs.

This spring, CAP submitted feedback to ONC on HIT certification programs, emphasizing the cascading impact of costs associated with extending permanent certification programs to other types of systems, with cost increases eventually affecting consumers. CAP also recommended clarification on the authority of certifications bodies as they relate to physician self-referral EHR exception and anti-kickback EHR safe harbor regulations.

SACGHS Issues DTC Testing, Genetic Education Training Recommendations

Two recent reports from the SACGHS offer recommendations on direct-to-consumer (DTC) genetic testing and education and training in genetics.

Recommendations in the area of genetics education cite challenges in integrating training efforts among different health care workforce groups, and ensuring that genomic medicine is adequately reimbursed if facilities and professional societies are going to invest in education and training.

In the report on DTC genetic testing, SACGHS recommended closing the gaps in federal oversight of DTC testing through guidance and regulations from the FDA and CMS. The committee also recommended that a joint HHS-Federal Trade Commission (FTC) task force be launched to develop guidelines for the FTC to evaluate DTC genetic testing claims.

2010 PQRI Reporting Period Begins July 1

The next reporting period option for the 2010 Physician Quality Improvement Reporting Initiative (PQRI) will begin on July 1. This six-month period—as well as year-long reporting period—will extend through Dec. 31. According to CMS, eligible providers can qualify for incentive payments equal to 2% of their total estimated allowed charges under the Part B Physician Fee Schedule (PFS) for covered professional services provided during the reporting period. Of the 179 quality measures, there are two pathology-related measures. Measure 99 involves breast cancer resection pathology reporting and measure 100 involves colorectal cancer resection pathology reporting

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