College of American Pathologists

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

November 20, 2014  •  Volume 30, Number 24
Next Issue: December 4, 2014
© 2014 College of American Pathologists

2015 CAP Policy MeetingIn This Issue:

CAP to Seek Significant Changes to FDA LDT Draft Guidance

The CAP does not support the Food and Drug Administration’s (FDA’s) proposed oversight guidance for laboratory-developed tests (LDTs) and will recommend major changes so the final document is consistent with the College’s principles.

“The CAP is not supporting the FDA LDT guidance in its current form and will be seeking significant changes to the FDA regulatory framework,” said CAP President Gene N. Herbek, MD, FCAP. “The CAP is concerned that as currently drafted the FDA’s approach may stifle medical innovation that will benefit patients and is too burdensome for laboratories.”

The FDA released its draft guidance on October 3 and will accept comments on the document until February 2, 2015. Currently, the CAP is engaged with key stakeholders as the College is concerned about the potential impact of the FDA guidance in its current form. The CAP is working to reduce the regulatory impact on laboratories while still ensuring a reasonable framework that provides accurate testing for patients.

Many of the CAP’s concerns are shared by the American Medical Association (AMA) and the American Clinical Laboratory Association (ACLA). A November 18 letter spearheaded by the AMA and ACLA called on the FDA to withdraw its draft guidance and issue a proposed regulation.

“The draft guidance documents conflict with existing regulations and would impose substantial new requirements on clinical laboratories, hospitals, physicians, and other health care providers without complying with notice and comment rulemaking as required under the Administrative Procedures Act (APA),” the letter stated.

The CAP did not sign the letter because the CAP believes the guidance review process provides greater flexibility to change the FDA’s proposed oversight document before it is finalized. In addition, after final guidance is in place, the FDA would have more flexibility to make changes that adapt to new innovations in science and technology.

In addition to signing the letter, the ACLA also has retained counsel as it explores potential legal actions against the FDA. Former Solicitor General Paul Clement and Laurence Tribe will represent the ACLA in its opposition to the FDA proposal.

Other physician and patient advocacy groups support the FDA’s move to regulate LDTs. American Society of Clinical Oncology (ASCO) Chief Medical Officer Richard L. Schilsky, MD, has stated his organization’s support for the risk-based approach to oversight as LDTs are being used to guide therapy selection for patients with cancer.

“Failure of such tests to perform as intended can lead to patients receiving an inappropriate and potentially harmful treatment or, alternatively, not receiving a treatment that has the potential to benefit them,” Dr. Schilsky said.

CAP’s Position on LDT Oversight

The CAP maintains that the final guidance document must be consistent with the College’s longstanding LDT policy. In 2009, the CAP had proposed a risk-based model employing a public-private partnership to address oversight of LDTs in an inclusive, systematic way. The CAP’s principles in the proposal are:

  • Assure quality laboratory testing for patients
  • Allow for continued innovation in diagnostic medicine
  • Establish the least burdensome regulatory requirements for laboratories.

The CAP’s principles must be reflected in the FDA’s guidance.

Main elements of the proposed FDA oversight framework include notification to the FDA of LDTs manufactured by a laboratory; continued enforcement discretion regarding low-risk LDTs, traditional LDTs, LDTs used for rare diseases, and LDTs for unmet needs; and, a risk-based, phased-in approach to enforce review requirements for high-risk and moderate-risk LDTs. Oversight also would involve the use of clinical literature to support clinical validity.

The CAP has noted differences between the College’s proposal and the FDA draft guidance. For instance, the CAP proposed that moderate- and low-risk LDTs be regulated by the Centers for Medicare & Medicaid Services (CMS), but the FDA in its proposal would assume all authority. The FDA definition of LDTs also is narrower, forcing more tests to go through traditional FDA clearance process.

Draft AMA Code of Ethics Needs More Revision, Pathologists Say

Pathologists called for more changes to the latest draft of the AMA Code of Ethics, which included revisions to sections regarding the billing of laboratory and pathology services.

The CAP and the Pathology Section Council (PSC) at the AMA provided testimony on proposed changes to the code by the AMA Council on Ethical and Judicial Affairs (CEJA) during a November 9 meeting of the AMA’s Council on Constitution and Bylaws at AMA’s interim meeting in Dallas. The CEJA is in the process of modernizing the code of ethics. Drafts from earlier this year would have negatively impacted pathologists and the medical profession, and the CAP has worked to change those provisions. However, more changes are needed to sections that involve consultation, referral, and second opinions; fees for medical services; and fees for nonclinical and administrative services.

At the AMA meeting, the CAP and the PSC called for further improvements to strengthen the code of ethics. The CEJA should retain policies to ensure transparency in notifying patients about laboratory services, to prohibit markups of another physician’s work, and that physicians provide patients with high-quality laboratory services.

Following testimony gathered at the AMA interim, the CEJA announced review of the code will continue throughout the rest of 2014. The Council will hold its online forum on changes to the code of ethics open through December 31. AMA members may still use the online forum to comment on the code of ethics. The CAP continues to advocate that all CAP members should also be AMA members in order to have a voice in important issues at the house of medicine, such as this.

The CEJA plans to review all the feedback received at the meeting and online to revise the ethics document. New revisions would be made available online before the AMA’s 2015 annual meeting in June.

STATLINE will continue to keep CAP members informed on new developments regarding this issue in future editions.

AMA Roundup: CAP Works to Address Narrow Network Problems

The CAP supported policies at the November AMA Interim Meeting to ensure insurance network adequacy standards for pathology services, study the effects of preauthorization practices by health plans, and convene a panel to discuss recommendations regarding outbreaks such as the Ebola virus.

Adequate patient access to physician services is a growing concern with health insurers restricting medical coverage to a narrow network of providers. With smaller networks of physicians and hospitals covered in plans, there is greater risk for patients unknowingly receiving care from out-of-network providers and being billed an exorbitant amount. Potentially problematic are narrow network composition of qualified health plans in state and federal health insurance exchanges.

The CAP supported new AMA policy to develop network adequacy standards for pathology services. Standards would govern all regulated health plans providing health care services, including pathology and laboratory medicine.

Following the AMA meeting, the CAP joined the AMA, state and specialty medical societies, and patient advocacy groups in signing a letter to the National Association of Insurance Commissioners (NAIC). NAIC is revising its Managed Care Plan Network Adequacy Act. The letter outlined concerns expressed at the meeting and firmly stated that provider networks must include a full range of primary, specialty, and subspecialty services for children and adults.

Preauthorization Practices

The CAP also supported an AMA resolution to convene a task force to study current preauthorization practices by managed care organizations. Insurers place great burden on ordering physicians and required authorization or notification is burdensome on laboratories and pathologists.

For instance, UnitedHealthcare has implemented a laboratory management and prior authorization pilot program in Florida. The CAP has opposed the pilot as it has fundamental flaws that will negatively affect patient access to services, delay test results, and create inconsistencies with current clinical practice, professional judgment, and laboratory operations.

The AMA will develop model state legislation to limit the use of preauthorization by managed care in a way that promotes the safe, sound practice of medicine while promoting the goals of improving patient care and health outcomes, while reducing health care costs.

Public Health Outbreaks

The AMA Interim Meeting in Dallas also debated the public health response to the Ebola virus. The first patient in the United States to die from Ebola was a Dallas man, who had contracted the disease in Liberia.

As experts in laboratory medicine, pathologists supported a call for the AMA to be a trusted source for information and education on urgent epidemics or pandemics affecting the US population.

Pathologists May Be Exempt from EHR Penalty in Future Years, CMS Says

In response to House and Senate letters urging the Medicare agency to exempt pathologists from payment penalties linked to EHR meaningful use, CMS Administrator Marilyn Tavenner said hardship exemptions will continue to be available for pathologists and other specialties.

Due to CAP advocacy, pathologists will receive an automatic exemption from the 2015 EHR meaningful use penalty that reduces Medicare pay by 1%. Next year will be the first year for the meaningful use payment adjustment, which is applied to physician payments when Medicare individual providers do not demonstrate EHR meaningful use by using certified technology and achieving objectives such as reporting clinical quality metrics electronically. The Medicare statute allows for hardship exemptions when physicians cannot meet meaningful use requirements. However, under current law these exemptions are limited to five years.

“We do not intend to limit this exception to the 2015 payment adjustment year,” Tavenner wrote. “Pathologists who meet the criteria for this exception may be exempted from the payment adjustments in future years, although we note as required by [law], this will be determined on a case-by-case basis, subject to annual renewal and the five-year limitation.”

CAP members had urged their representatives and senators in Washington to write the CMS asking for pathologists to be exempt from the penalty for the full five-year period. A bipartisan group of 89 House members sent the CMS a letter in July and 16 Senators followed by submitting a similar letter in September.

CAP Urges Congress to Repeal the SGR During Lame-Duck Session

The CAP urged House and Senate lawmakers to take up and pass legislation that permanently repeal the flawed Medicare sustainable growth rate (SGR) formula before the end of the year.

“The time to act is now and the CAP stands ready to work with you to get the job done,” said CAP President Gene N. Herbek MD, FCAP, in a November 13 letter to congressional leadership.

The CAP called on Congress to pass the bipartisan, bicameral SGR Repeal and Medicare Provider Payment Modernization Act of 2014 (HR 4015/S 2000) to permanently repeal the SGR formula and ensure that specialties, such as pathology, can fully and fairly participate in a new payment system tied to meeting quality measures. The College has worked to include reforms in the legislation that account for differences in specialty practice and provide flexibility in meeting quality measures under the Physician Quality Reporting System (PQRS), electronic health record (EHR) meaningful use and the value-based modifier programs.

Physicians face a 21.2% SGR cut to Medicare reimbursements after a payment freeze expires at the end of March 2015. For several years, Congress has delayed SGR cuts temporarily instead of permanently fixing the flawed formula.

“We’re concerned that delaying action until the new Congress could result in another costly, short-term ‘patch’ that neither fixes the problem nor provides the important payment reforms included in the bipartisan repeal bills,” Dr. Herbek said.

AMA Invites ADLT Stakeholders to Apply for CPT Codes

Laboratories with tests that may qualify as advanced diagnostic laboratory tests (ADLTs) and currently paid by Medicare are invited to submit applications for consideration by the AMA Current Procedural Terminology (CPT) Editorial Panel.

The 2014 Protecting Access to Medicare Act (PAMA) defines an ADLT as a clinical diagnostic laboratory test that is offered and furnished only by a single laboratory and not sold for use by a laboratory other than the original developing laboratory. In addition, the test must meet one of the following criteria:

  • The test is analysis of multiple biomarkers of DNA, RNA, or proteins combined with a unique algorithm to yield a single patient-specific result; or
  • The test is cleared or approved by the FDA.

The AMA welcomes the opportunity to work with each applicant to ensure a cohesive and transparent code change application process, according to a notice posted on the association’s website. The deadline for submission of code change applications for the February 2015 CPT Editorial Panel meeting has been extended for these ADLTs stakeholder applicants until November 21.

To receive further information regarding this effort, the AMA requests stakeholders to contact the association immediately. Applications are available on the AMA website.

Webinar: How to Report New Pathology PQRS Measures for 2015

Several changes to the Medicare Physician Quality Reporting System (PQRS) will go into effect in 2015. These new changes are important to pathologists as the Medicare program will base future payment penalties on how well physicians and groups perform in the 2015 PQRS.

On December 2, the CAP will host a webinar on how to report new PQRS measures and meet reporting requirements during our webinar. CAP experts will explain how pathologists can successfully participate in PQRS next year.

Register today for this 60-minute presentation.


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