College of American Pathologists

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

December 5, 2013  •  Volume 29, Number 24
Next Issue: December 19, 2013
© 2013 College of American Pathologists

In This Issue:

CMS Halts Plan to Cap Pathology Payments to APC Rates, Payments for Other Key Services Reduced

On Nov. 27, the Centers for Medicare and Medicaid Services (CMS) released final rules for the 2014 Physician Fee Schedule (PFS) and Hospital Outpatient Prospective Payment System (HOPPS). CMS decided not to proceed with its plan to cap payments under the 2014 physician fee schedule at Hospital Outpatient Ambulatory Payment Classification (APC) Rates. However, CMS reduced payment for certain Anatomic Pathology (AP) codes and expanded bundling of payments for all clinical laboratory tests (other than molecular pathology tests) performed on hospital outpatients that are currently billed to the Clinical Laboratory fee Schedule (CLFS).

The full list of final rules is available on the Office of the Federal Register website.

On Dec. 4, CAP held an exclusive, members-only webinar featuring an in-depth discussion with CAP experts about the final rule’s outcomes and implications for pathologists. A recording of the Webinar, “CMS Issues Rule on Medicare Payment Cuts in 2014, Other Significant Developments”, is available for download. The webinar’s frequently asked questions and presentation, is also available for download.

2014 Anatomic Pathology Code Revaluations

For a full table outlining the changes, visit the CAP’s website.

As expected, the final rule included payment reductions to several pathology code families. The following changes go into effect January 1, 2014:

Immunohistochemistry: 88342 (PC & TC)
CMS rejected the CAP’s proposal and instead will require the use of two new G codes for this service, including G0461 to report one unit of service per specimen and G0462 to report each additional stain. The following chart documents the percentage reduction and payment rate change for the new G codes compared to the current reimbursement for CPT code 88342:

CPT CodeModifier88342 2013 Total Payment2014 Total PaymentTotal % Change from 2013 88342
G0461 $115.34$88.04-24%
G0462 $115.34$68.08-41%

The changes occurred under the Affordable Care Act (ACA), which provided CMS expanded authority to launch its “misvalued code” initiative. CMS targeted the top expenditure codes from each specialty as potentially overvalued. This action triggered the review of the three additional high volume code families.

Moving forward, the CAP will work with the AMA and other groups to pressure CMS to change their G code definitions so that payment is made ‘per slide’ rather than ‘per specimen.’

Enhanced Cytology Services: 88112 (PC & TC)
The code, which had not been revalued in 10 years and was targeted for review due to its high volume, is now delivered by less resource intensive techniques since it was first valued. It was reduced as documented in the following chart:

CPT CodeModifier88342 2013 Total Payment2014 Total PaymentTotal % Change from 2013
88112 $109.55$62.73-43%

In situ hybridization services: 88365, 88367, and 88368 (PC & TC)
CMS deferred final action on the revaluation of these services for 2014, but changes are anticipated beginning in 2015. The code has not been reviewed in nearly 10 years.

Increased use since the 2004 establishment of the FISH codes has prompted CMS to repeatedly call for payment review. However, in early December, the National Correct Coding Initiative (NCCI) posted new claim edits aimed at restricting utilization of in situ hybridization and immunofluorescence services (88346-7), among other services identified by CMS for review.

The CAP will be communicating with CMS to address their assumptions with the intent of clarifying the NCCI edits.

88305 TC
In the 2013 Physician Fee Schedule rule, CMS requested additional data review by the AMA/Specialty Society Relative Value Scale Update Committee (RUC) to support 2013 revaluation of this service. Based on the input received, no further cuts in payment were taken for 2014.

Prostate biopsies
In its decision, CMS established new G codes (G0416-G0419) which will apply to all prostate biopsies (regardless of surgical technique) when 10 or more specimens are reviewed. Increased scrutiny in the reporting of multiple prostate biopsy specimens led to this policy change. Prostate biopsies with fewer than 10 specimens should be billed using CPT code 88305.

Optical Endomicroscopy
CMS declined to set payment for unique pathology services associated with optical endomicroscopy and suggested that pathologists can bill for this service utilizing existing codes when applicable.

Molecular Pathology
CMS finalized a work RVU of 0.37 for HCPCS code G0452 molecular pathology procedure; physician interpretation and report. CMS also notes that: “The decision to pay for molecular pathology codes under the CLFS required the creation of a new code for the interpretation and reporting services by pathologists on the PFS. We continue to believe that the creation of HCPCS code G0452 was appropriate to describe medically necessary interpretation and written report of a molecular pathology test, above and beyond the report of laboratory results.”

Capping Payment Rates in the PFS at Hospital Outpatient APC Rates

On Nov. 27, CMS announced that it would not proceed with its plan to cap payment rates in the physician fee schedule at hospital outpatient APC rates. However, the agency has said it will revise and reissue a proposal in the future and remains committed to the underlying payment policy of “site neutrality.”

The CAP has been opposed to this policy since it was originally proposed in July. The proposal, if finalized, would have reduced the TC and global payment of 39 pathology services billed for non-hospital patients by as little as 4 percent and as much as 80 percent depending on the service. This policy also circumvented the established RUC process, which involves physicians in decision-making and relies on data that reflect the costs of performing services in physician practices.

CMS has claimed hospital data is more reliable than what is submitted by physicians through the RUC. But CAP’s comments to CMS on the proposed rule highlighted the statutory requirement that the physician fee schedule should be resource-based.

Moving forward, the CAP will consult with our coalition partners and more than 150 Congressional supporters on next steps to prevent future implementation of this or similar policies The CAP will continue to reiterate that hospital data does not accurately account for the cost of delivering services in the non-facility setting.

Changes to Medicare’s Hospital Outpatient Prospective Payment System (HOPPS)

Beginning Jan. 1, 2014, payment for all clinical diagnostic laboratory tests (other than molecular pathology tests) performed on hospital outpatients that are currently billed to the Clinical Lab Fee Schedule (CLFS) will be “bundled” into payment for primary hospital outpatient procedures. The expanded bundled payment would apply for services that are 1) provided on the same date of service as the primary service and 2) ordered by the same practitioner who ordered the primary service. Further, CMS decided to bundle payment for certain “add-on” codes with the initial service. The affected pathology services include:

CY 2014 HCPCS CodeCY 2014 Short Descriptor
88177Cytp fna eval ea addl
88185Flowcytometry/tc add-on
88311Decalcify tissue
88314Histochemical stains add-on
88332Path consult intraop addl
88334Intraop cyto path consult 2
88388Tiss ex molecul study add-on

Other pathology procedures have been assigned to new APCs. View a full list of pathology codes mapped to their new APCs and corresponding 2014 payment rates.

The CAP made clear its serious concerns with the proposal on behalf of pathology and the laboratory community, noting that these are complex proposals that are impossible to assess without fully understanding the methodology employed by CMS, particularly how payments will be distributed on a code-by-code basis, for both the primary and supporting services. The CAP is continuing to analyze the payment changes for pathology services in the 2014 HOPPS.

Physician Quality Reporting System (PQRS)

In its final rule, CMS did not accept the CAP’s three new pathology quality measures. However, CMS will allow pathologists to qualify for 2014 incentives by reporting on the existing five measures by either claims or registry.

CMS is also finalizing several related proposals to the PQRS for 2014, CMS is aligning PQRS measures with the National Quality Strategy and meaningful use requirements, and transitioning away from process measures in favor of performance and outcome measures. These changes move the PQRS program in a direction that is less favorable for pathology. For this reason, the CAP is working with Congress on the SGR to create flexibility in the PQRS program and exempt pathologists from meaningful use requirements. For example, SGR reform proposals would give pathologists the ability to use clinical practice improvement activities to meet PQRS requirements and avoid payment penalties. Later this month, the CAP will also make available a Webinar on the PQRS program changes in 2014.

Clinical Lab Fee Schedule (CLFS)

On Nov. 27, CMS finalized its proposal to create a new process that will revalue Clinical Lab Fee Schedule (CLFS) payment amounts. CMS is finalizing a process to adjust payment rates for test codes on the CLFS based on technological changes. Currently, the payment rates for test codes on the CLFS do not change once they have been set (except for changes due to inflation and other statutory adjustments). According to CMS, this review process will enable the agency to pay more accurately for laboratory tests.

The process will begin in 2014 and occur over a five-year period, with the first round of payment cuts for clinical lab tests expected in January 2015.

According to the CAP, a combination of changes led to this process. For several years, CMS has expressed concern that the CLFS needed to be revalued. Additionally, the proposal followed a June 2013 Office of Inspector General report which concluded that Medicare paid between 18 and 30 percent more than other insurers for 20 high-volume and/or high-expenditure lab tests.

The CAP expects to be at the table and heavily engaged in the revaluing process over the next five years.

Physician Value-Based Payment Modifier (Value Modifier)

CMS’ final rule also includes several provisions regarding physician quality programs and the Physician Value-Based Payment Modifier (Value Modifier). For 2016, CMS is finalizing its proposals to apply the Physician Value Modifier to groups of physicians with 10 or more eligible professionals, and to apply upward and downward payment adjustments based on performance to groups of physicians with 100 or more eligible professionals. However, only upward adjustments based on performance (not downward adjustments) will be applied to groups of physicians with between 10 and 99 eligible professionals.

Medicare Shared Savings Program (MSSP) and ACOs
In its final rule CMS prioritized the development and implementation of a series of initiatives designed to improve payment for, and encourage long-term investment in, care management. Initiatives include the MSSP, Pioneer ACO model and the Advance Payment model. In the MSSP final rule, CMS indicated it would publicly report ACO performance on quality measures on Physician Compare.

SGR Reform and Self-Referral
The House Energy and Commerce Committee unanimously passed an SGR reform bill. In response, the Senate Finance Committee will be marking up legislation next week. It is still unclear if the House Ways and Means Committee will be acting in the next couple weeks.

However, none of the current proposals has established a method to pay for reform, which will be a major issue for Congress to address in passing SGR reform.

Enacting long-term SGR reform before year’s end is becoming more challenging as the number of legislative days left in the year is dwindling quickly.

Congress is considering a short-term patch so they continue their efforts to achieve a deal on a permanent reform package.

The CAP is working with its coalition partners to attach legislation closing the self-referral loop hole to an SGR reform package as a way to help pay-for SGR reform as self-referral remains a very politically charged and important issue.

CAP Co-Sponsors Summit to Address Pathology Workforce Issues

Representatives of 24 national professional organizations, representing pathology and medical education, met this week in Washington, DC to develop a plan of action for how the pathology and laboratory medicine workforce of the future can best meet patient needs. The conference was sponsored by the College of American Pathologists (CAP), the American Society for Clinical Pathology (ASCP), the Association of Pathology Chairs (APC), and the United States & Canadian Academy of Pathology (USCAP).

The conference was designed to enable participants to develop and articulate a common understanding and set of priorities on workforce issues affecting the ability of pathology and laboratory medicine to provide optimal patient care, focusing on actions in three main areas: (1) re-assessing what every pathologist needs to know and identifying new ways to ensure that adequate numbers of pathologists acquire both general skills and sub-specialized expertise, especially in key emerging areas; (2) organizing pathology to attract and recruit highly-qualified medical and STEM (science, technology, engineering, and mathematics) students into pathology and laboratory professions; and (3) re-evaluating long-term training expectations and practice roles for all members of the laboratory workforce, in light of emerging technologies and evolving healthcare delivery models.

In addition to the sponsoring organizations, participants included: the Academy of Clinical Laboratory Physicians and Scientists; the Accreditation Council for Graduate Medical Education-Pathology Residency Review Committee; the American Association of Neuropathologists; the American Board of Oral and Maxillofacial Pathology; the American Board of Pathology; American Society of Cytopathology; the American Medical Association; the American Pathology Foundation; the American Society for Investigative Pathology; the American Society of Dermatopathology; the Association for Molecular Pathology; the Association for Pathology Informatics; the Association of American Medical Colleges; the Association of Clinical Scientists; the Association of Directors of Anatomic and Surgical Pathology; the Association of Pathology Chairs/Program Directors Section (PRODS); the Canadian Association of Pathologists; the National Association of Medical Examiners; the Society for Hematopathology; and the Society for Pediatric Pathology.

No further details on the conference’s outcomes were available at press time. Statline will be reporting more on this Summit in a future issue.

CAP Request Reflected in Colorado Clean Claims Task Force Rule

The Colorado Clean Claims Task Force has issued a new draft editing and coding document that reflects the changes requested by the CAP on October 4. The CAP requested that coding edits adhere or conform to a 2012 state law that regulates billing for anatomic pathology (AP) services.

The task force, in comments released in November, acknowledged its oversight of Colorado law, and stated that “the omission of modifier 90 from the proposed rule was an oversight, and we agree that it should be included.” Modifier 90 is a pass-through billing code now effectively banned for AP and subcellular/molecular pathology services under a 2012 direct billing law enacted in Colorado.

The Task Force also stated that “the final rule will include a statement instructing that the professional component for AP and subcellular/molecular pathology can only be billed by the qualified healthcare professional who performs the interpretation”. Additionally, the rule will indicate that the technical component of the Pap test (including, cytopathology services for cervical cancer screening Pap codes 88141-8175) cannot be billed by a health care provider when such services are performed by an outside laboratory.

The activity of the task force is authorized under a 2010 Colorado law that initiated a stakeholder group responsible for establishing a standardized set of coding edits and making recommendations concerning how the set will be implemented, updated and disseminated. The act further requires any person or entity that contracts with a health care provider in Colorado comply with the act and include the provisions required by the act in the contract. This includes not only commercial health plans but also third-party administrators of self-insured health plans that have contracts with providers in Colorado.

Enforcement of the act is by private right-of-action, and does not apply to Medicaid and Medicare.


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