STATLINE

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In This Issue:

• CAP Urges Medicare to Remove Discounts to Pathology Services in 2017
• New Ways for Physicians to Stop MACRA Penalties Will Be Available in 2017
• In 2017 Medicare Hospital Proposal, CAP Opposes Additional Packaging of Lab Services
• CAP Prepares You for MIPS, MACRA: Reserve Your Seat for Advocacy Courses at CAP16
• California Passes Bill Addressing Out-Of-Network Pay for Physician Services

The Medicare program should remove discounts applied to pathology add-on codes for immunohistochemistry and immunofluorescence studies, and accept recommendations to mitigate reimbursement cuts to flow cytometry services, the CAP advocated in its formal comments on the proposed 2017 Medicare Physician Fee Schedule.

The CAP continues to engage with the Centers for Medicare & Medicaid Services (CMS) on the proposed 2017 fee schedule following its release on July 7. Due to the CAP's advocacy, the CMS proposed to increase the value of pathology add-on codes by reducing a discount applied to the services. While this would represent an increase compared to previous years, the CAP urged the CMS to recognize that each pathology service is distinct and formulaic discounts are not appropriate.

Read the CAP's September 6 comment letter to the CMS. In addition, view the CAP's webinar with a complete analysis of the proposed 2017 Medicare Physician Fee Schedule.

Add-on Discounts Should Not be Assumed

For 2017, the CMS proposed to apply a discount to specific pathology add-on codes, which would pay 20% less than their base codes. For instance, the immunofluorescence add-on code 88350 would receive a 20% discount when compared to the base code 88346, to recognize efficiencies between them. In 2016, Medicare applies a 24% discount.

In the proposed fee schedule, the CMS stated it would apply the discount in a similar manner to two add-on intravascular ultrasound evaluation services, 37252 and 37253. The CAP stated that the two intravascular procedures are not comparable medical services to immunohistochemistry codes 88342 and 88341, as well as 88346 and 88350.

In addition, each of these pathology services is unique and distinct from all other medical services within and outside the domain of the specialty of pathology. There are differences in the components of each of the services and in their individual intensities and complexities that terminally compromise any attempt at rational comparison of the physician work of intravascular ultrasound services to pathology services.

The CAP urged the agency to accept the AMA/Specialty Society Relative Value Scale Update Committee, or RUC, recommended values for add-on services for immunohistochemistry, immunofluorescence, and morphometric analysis codes.

Flow Cytometry

The CAP advocated for several changes to proposed values for flow cytometry services and urged the CMS to adopt recommendations from the AMA/Specialty Society Relative Value Scale Update Committee, or RUC. For 2017, the CMS has 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.

For 88188, for example, the CAP opposes the CMS’ proposed cross-walked work RVU of 1.20, which is based on the code 88120 for cytopathology, in situ hybridization (eg, FISH), urinary tract specimen with morphometric analysis, 3–5 molecular probes, each specimen. The RUC recommended value for 88188 is 1.40. "It should be recognized that the physician work of CPT code 88120 is much different than that of CPT code 88188. The step-by-step physician work efforts are completely different, as are their intensities and complexities," the CAP stated.

Prostate G-Code

The CAP has sought increases 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.

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As the CMS prepares to implement new Medicare payment reforms, the agency outlined a plan to include multiple options for physicians in 2017 that aims to lower the burden on those seeking to avoid payment penalties in 2019.

On September 8, the CMS announced it would allow physicians to "pick their pace of participation for the first performance period that begins on January 1, 2017." A pathologist choosing one of four options presented by the CMS, and then working to meet the option's criteria, would ensure that he or she would not receive a negative Medicare pay adjustment under the Medicare Access and CHIP Reauthorization Act (MACRA) in 2019. Since MACRA's enactment in 2015, the CAP has called for flexibility for pathologists to meet program requirements.

At this time, the CMS' announcement will only apply to the 2017 reporting year.

The four options are to:

• Test the quality payment program by submitting some data to the CMS
• Participate for part of the calendar year in MIPS and remain eligible for partial bonus
• Participate for the full calendar year in MIPS and remain eligible for full bonus
• Participate in an advanced alternative payment model in 2017

For those pathologists who choose to test the program, they will just need to attempt to report in MACRA's Merit-based Incentive Payment System (MIPS), but don't necessarily need to be successful in order to avoid the penalty. It is not clear yet if they have to try to participate in all applicable MIPS categories or just the quality category, which is similar to the current Physician Quality Reporting System (PQRS).

Those who do not try to participate in the MIPS program or the new options are likely to see the full -4% Medicare penalty in 2019.

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The CAP submitted formal comments on the CMS’ proposed Medicare hospital outpatient payment regulation, which focused on opposition to further packaging of payment for clinical laboratory tests with hospital outpatient payments and also expressed the CAP’s support for separate payments for blood products in the outpatient setting.

The CAP submitted its comments on the proposed 2017 Medicare Hospital OPPS rule on September 6. The CAP opposed the CMS' efforts to package additional laboratory tests and warned of unintended consequences. For example, the burden of these changes may fall disproportionately on the providers of care for patients with complex chronic conditions.

"The CAP is very concerned that the rapid pace of these changes exceeds both the hospitals' and laboratories' adaptive capacity and the Agency's ability to accurately model and sufficiently explain the impact of either past or current proposals," the CAP stated in its letter.

The CAP also is concerned that the rapidity with which new policies are being adopted and the lack of full detailed impact analyses published in the OPS rulings leave inadequate time to identify and address implementation issues. The CAP urged the CMS to review the overall adequacy of OPPS payments to hospitals and laboratories.

Updates Affecting Blood and Blood Products

For 2017, the CMS proposes to make separate payments for blood and blood products when they appear on the same claims as services assigned to comprehensive ambulatory payment classifications (C-APCs). Citing its support for comments from the American Association of Blood Banks, the CAP urged the CMS to not to implement this proposal and continue to provide separate payments for blood products in the outpatient setting.

"These distinct payments recognize the particular role blood and individual blood products play in caring for a wide range of patients," the CAP said. "They also are needed to account for the increasing cost of blood products associated with critical blood safety measures provided by nonprofit blood centers."

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Registration is now open for key CAP policy and advocacy courses and roundtable discussions important to the pathology specialty during CAP16 in Las Vegas September 25-28.

Ensure you can attend "MACRA, Pay for Performance and the Physician Fee Schedule—You Can Run But You Can't Hide" (S1620) by registering and selecting this popular course today. Enactment of the Medicare Access and CHIP Reauthorization Act (MACRA) will change how all physicians are paid under Medicare. Make sure to attend this course and learn about this game changing mandatory Medicare physician payment system. Measurement periods begin in 2017 so register now so that you are ready for these changed to Medicare's physician reimbursement system.

During this featured presentation, attendees will learn the purpose of new pay-for-performance programs and delivery system reform culminating in the enactment and implementation of MACRA. Experts will explain which pathologists are subject to, and ways to successfully participate in, the merit-based incentive payment system and alternative payment model pathways. The potential ramifications for not participating will also be discussed.

The session starts at 8 AM on Monday, September 26. Register for S1620 MACRA, "Pay for Performance and the Physician Fee Schedule—You Can Run But You Can't Hide" today.

Additional CAP advocacy courses and roundtable discussions are also available at CAP16:

• M1597 "How is My Payment Determined for Pathology Services?"
  Sunday, September 25, 4:30-5:30 PM
• R1690 "My Surgical Pathology and Cytopathology Coding Dilemmas: Getting It Right"
  Monday, September 26, Noon-1 PM
• STA001 "How Data Drives CAP Advocacy: What Pathologists are Saying about the Economics of Pathology Practice"
  Monday, September 26, 5:30-6:30 PM
• R1691 "Current Payment Policy Challenges in Pathology Practice"
  Tuesday, September 27, Noon-1 PM

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After several years of debate on legislating out-of-network billing of medical services, the California State Legislature passed a bill to require health plans to pay out-of-network physicians either average contracted rates or 125% of the amount Medicare reimburses, whichever amount is greater, for services provided to beneficiaries.

The California Society of Pathologists (CSP) and physician societies, including the California Medical Association, took a neutral position on the bill after engaging with lawmakers, patient advocacy groups, and several other stakeholders to reach a compromise. Previously, the CSP and the CAP had opposed a different version of the bill considered in 2015. That bill had attempted to address payment for out-of-network services but placed significant burdens on physicians.

Following the 2015 bill's defeat, a workgroup of stakeholders was created in January 2016 to reach a compromise. The CSP urged the group to use the FAIR Health database, an independent source of health care cost and insurance information, but other stakeholders did not agree and favored other sources, said CSP Executive Director Bob Achermann. Under the compromise, noncontracted physicians providing services at in-network hospitals or facilities would receive the greater reimbursement rate of either an insurer's average contracted rate or 125% of the rate Medicare pays under its physician fee schedule. The new payment formula does not apply to emergency medicine services.

In August, the bill passed the state Senate overwhelmingly and the Assembly unanimously. Once signed into law, the legislation would be effective July 1, 2017. The bill would also establish an independent resolution process for physicians to settle disputes for claims and require regulators to address network adequacy to ensure patients have sufficient access to in-network services from hospital-based physicians.

In March, California insurance regulators announced stronger requirements for health insurers to maintain adequate networks in a regulation published on March 8. The regulations state a health plan "network includes adequate numbers of available primary care providers and specialists with admitting and practice privileges at network hospitals."

Insurers are required to submit to the California Department of Insurance network adequacy reports describing each "network hospital and percentages of physicians in specialties of emergency medicine, anesthesiology, radiology, pathology, and neonatology practicing in the hospital and are in the insurer’s network(s)."

The CAP advocates for state regulators to require health plans to ensure patients at in-network facilities have reasonable access to in-network providers. At the same time, the CAP continues to oppose out-of-network legislation, similar to the bills drafted in Colorado and Tennessee, to limit health plan financial responsibility for balance billing while failing to ensure patient access to in-network hospital-based physicians.

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