Read the Latest Issue of STATLINE
Special Report: November 2, 2016
Pathology Services on Medicare Misvalued List Avoid Cuts in 2017; IHC, FISH Add-ons Increase
Several pathology services targeted as misvalued by the Medicare program maintained their values in the 2017 Medicare Physician Fee Schedule released by the Centers for Medicare & Medicaid Services (CMS) on November 2. Further, the CMS increased reimbursement for add-on codes used for immunohistochemistry and immunofluorescence services, which the CAP had strongly advocated for since 2014.
The CMS estimates the overall physician fee schedule payment received by pathologists will decrease slightly by 1% in 2017. Changes to work relative value units, which comprise the majority of the professional component (PC) payment for pathology services as well as global payments, finalized in the 2017 Medicare fee schedule resulted in an increase, although the CMS' impact table included in the final rule shows a 0% change due to rounding. The practice expense relative value units, used to calculate technical component (TC) and global payments, would result in a 2% decrease to pathology services. The decrease stems from proposed changes in the direct practice expense inputs such as medical supplies used to calculate the practice expense relative value units (RVUs).
The physician fee schedule payment received by independent laboratories is estimated to decrease 5% due to these same proposed changes in practice expense costs.
The actual impact upon an individual pathologist or practice will depend on the mix of services provided to beneficiaries with Medicare or other public or private health plan coverage.
The CAP will continue to engage with the CMS on the final 2017 fee schedule and seek further understanding of its published values, and keep members updated through STATLINE on its work to protect the value of pathology services provided to patients and mitigate potential cuts.
Download the CAP's Impact Table based on CMS' datapublished on November 2, 2016.
Register for the CAP’s November 8 Webinar
Learn more about the final 2017 Medicare fee schedule and specific reimbursement changes concerning pathologists during the CAP's November 8 webinar. During this one-hour panel discussion at 2:00 PM ET, the CAP's experts will explain the changes in policy and reimbursement for next year. Register now to learn about the CAP's advocacy efforts to impact the CMS' proposal prior to its finalization.
IHC and FISH Add-on codes
Due to the CAP's continued engagement with the CMS, the agency again increased the value of pathology add-on services by reducing their previous discount applied to these codes. Specifically, the CMS increased the valuation from a 24% discount from the base code to a 20% discount. This increase was finalized by the Medicare agency in the 2017 final rule.
These physician work RVU increases used to determine the PC payment are proposed for add-on services involving immunohistochemistry, immunofluorescence studies, and in situ hybridization. The CAP continues to maintain that for most pathology services, the difference in physician work from the base code to the add-on service is miniscule.
In a September 6 letter to the CMS, the CAP advocated that the Medicare program should remove discounts applied to pathology add-on codes. While the 2017 rates for add-ons represent an increase compared to previous years, the CAP urged the CMS to recognize that each pathology service is unique and distinct, and therefore any formulaic discounts are not appropriate.
In the final fee schedule, the CMS finalized cuts to flow cytometry. The agency had previously targeted flow cytometry payment in its misvalued code initiative. The CAP worked with the AMA/Specialty Society Relative Value Scale Update Committee, or RUC, and met with the CMS in an attempt to reinstate some of the previously identified reductions to these codes. But the Medicare agency finalized the 2017 reductions to the professional and technical component valuations of the flow cytometry codes.
The CAP has advocated for several changes to values for flow cytometry services and urged the CMS to adopt recommendations from the RUC. For 2017, the CMS had proposed to accept the RUC recommended work relative value units (RVUs) for CPT codes 88187 and 88189, but the agency did not accept RUC recommendations in other instances. The CMS finalized these changes.
In the proposed rule, the CMS recommended changes to the coding structure for flow cytometry services. In the final rule, the CMS stated: "We do not intend to finalize any recommendations regarding the coding structure at this time."
Microslide Consultation (CPT codes 88321, 88323, 88325)
The CMS, in 2015, had identified microslide consultation code 88321 as a potentially misvalued service. The CAP subsequently conducted an AMA physician work survey which supported the existing physician work relative values for CPT codes 88321 and 88323, but indicated a higher value should be applied to code 88325. The CAP agreed with the physician work survey values and advocated a 14% increase for CPT code 88325. The CMS agreed and finalized the values for 2017 for all three codes as recommended by the CAP.
The CAP sought an increase to the professional component of the prostate G-code (G0416) reported for all prostate biopsy services. As a result of this effort, the CMS proposed to increase the physician work component of G0416 from 3.09 to 3.60 in 2017, which is a 17% increase.
While the CMS proposed the increase, the CAP advocated for the agency to use the RUC recommended work value of 4.00 for G0416. The CAP disagreed with a formulaic approach used by the CMS to calculate the 3.60 value.
In the final fee schedule, the CMS finalized the increase the agency had proposed for next year.