{"id":4592,"date":"2013-07-19T01:35:00","date_gmt":"2013-07-19T01:35:00","guid":{"rendered":"https:\/\/www.healthlawpolicymatters.com\/?p=4592"},"modified":"2021-11-03T01:36:12","modified_gmt":"2021-11-03T01:36:12","slug":"proposed-medicare-cuts-would-significantly-impact-independent-laboratories","status":"publish","type":"post","link":"https:\/\/www.healthlawpolicymatters.com\/2013\/07\/19\/proposed-medicare-cuts-would-significantly-impact-independent-laboratories\/","title":{"rendered":"Proposed Medicare Cuts Would Significantly Impact Independent Laboratories"},"content":{"rendered":"\n

Written by\u00a0Roy Albert\u00a0<\/a>and\u00a0Karen Lovitch<\/a><\/strong><\/em><\/p>\n\n\n\n

Last week, the\u00a0Centers for Medicare & Medicaid Services<\/a>\u00a0(CMS) published a\u00a0proposed rule<\/a>\u00a0setting forth revisions to payment policies under the Medicare Physician Fee Schedule (MPFS) and other revisions to Medicare Part B for calendar year 2014.\u00a0 The rule proposes several changes that, if finalized, would have grave consequences for independent laboratories.\u00a0<\/p>\n\n\n\n

Pathology laboratories would take the greatest hit as a result of CMS\u2019s proposal to adjust payment rates for about 200 codes that supposedly have \u201cmisvalued\u201d resource inputs.  The focus is on services that Medicare pays more for when furnished in an office, laboratory, or other non-facility setting than in an outpatient hospital department or ambulatory surgical center (ASC).  To address \u201canomalous site-of-service payment differentials\u201d that \u201care the result of inaccurate resource input data used to establish rates\u201d under the MPFS, CMS proposes to limit reimbursement to the total payment that Medicare would make when the service is furnished in a hospital outpatient department or ASC.  According to CMS, the cost data provided by non-hospitals for purposes of calculating the Practice Expense Relative Value Units is less reliable than the annual, auditable data provided by hospitals for this purpose.  In taking this position, CMS fails to take into account the vast differences in the way that hospitals and independent laboratories deliver laboratory services.<\/p>\n\n\n\n

Overall, this change could reportedly decrease reimbursement to independent laboratories by 25%, but for pathology laboratories the reduction would be closer to 50% or more because their revenue comes primarily from physician services.\u00a0 Payment for the technical component (TC) of 88185 (flow cytometry) would be reduced by a whopping 76% while payment for the TC of 88342 (immunohistochemistry) would be cut by 47%.\u00a0 Reimbursement for special stains would also be\u00a0substantially reduced.\u00a0 The fact that payment for the TC of 88305 would go down by only 7% is cold comfort given that CMS already instituted a substantial cut in reimbursement for this service, as detailed in a\u00a0previous post<\/a>.<\/p>\n\n\n\n

Many are wondering why CMS would propose such drastic cuts in reimbursement for much-needed pathology services.\u00a0 CMS may be seeking to discourage self-referrals for pathology services performed in physician\u00a0office laboratories, a practice that was highlighted in a recent\u00a0GAO report<\/a>\u00a0and that has received considerable attention since CMS loosened its restrictions on reimbursement for self-referred pathology and certain other diagnostic services\u00a0in 2009.\u00a0 But punishing independent laboratories in the process seems unfair when CMS could more effectively remedy the situation by amending the Stark Law\u2019s\u00a0in-office ancillary services exception<\/a>.\u00a0 The American Clinical Laboratory Association\u00a0and others have vigorously lobbied CMS to tighten both regulations to prevent abusive self-referral arrangements for a number of years now.<\/p>\n\n\n\n

Adding insult to injury, CMS also proposes to begin reexamining the payment amounts established under the Medicare Clinical Laboratory Fee Schedule to determine if changes in technology warrant a payment adjustment.  If the proposed rule is finalized, CMS would identify specific test codes subject to payment adjustment, discuss the impact of technological changes on those codes, and propose adjustments as appropriate to reflect the impact of such technological changes.  This course of action would begin with the calendar year 2015 MPFS proposed rule.  CMS proposes to review all codes over a five-year period.<\/p>\n\n\n\n

The American Clinical Laboratory Association (ACLA) and the College of American Pathologists (CAP) issued statements\u00a0critical<\/a>\u00a0of the proposal.\u00a0 Public comments are due in early September, and the final rule, which would become effective on January 1, 2014, is expected in November.<\/p>\n","protected":false},"excerpt":{"rendered":"

Written by\u00a0Roy Albert\u00a0and\u00a0Karen Lovitch Last week, the\u00a0Centers for Medicare & Medicaid Services\u00a0(CMS) published a\u00a0proposed rule\u00a0setting forth revisions to payment policies under the Medicare Physician Fee Schedule (MPFS) and other revisions to Medicare Part B for calendar year 2014.\u00a0 The rule proposes several changes that, if finalized, would have grave consequences for independent laboratories.\u00a0 Pathology laboratories … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_generate-full-width-content":"","footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/posts\/4592"}],"collection":[{"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/comments?post=4592"}],"version-history":[{"count":2,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/posts\/4592\/revisions"}],"predecessor-version":[{"id":4594,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/posts\/4592\/revisions\/4594"}],"wp:attachment":[{"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/media?parent=4592"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/categories?post=4592"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.healthlawpolicymatters.com\/wp-json\/wp\/v2\/tags?post=4592"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}