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ePolicy News September 2013

Wednesday, September 4, 2013



ASCP Community Unites in Response to CMS Payment Scheme:
10,000 Messages Sent to Congress and CMS

In early July, the U.S. Centers for Medicare and Medicaid Services (CMS) released a proposed rule that rocked the pathology and laboratory world. The draft rule proposed to cap payment rates for services on the physician fee schedule at the Outpatient Prospective Payment Rate. The proposal, which focuses on the technical component (TC) charges, affects TC and global billing—not the professional component. Overall, CMS estimates that the cap proposal would reduce Medicare reimbursement for independent clinical laboratories by 26 percent and 6 percent for pathologists, on average. A number of the codes used by pathologists and laboratories could be cut by 50 to 80 percent. (See ASCP’s July ePolicy News brief on the CMS proposed rule, available here.)

ASCP’s Government Relations operations have been actively fighting the proposed rule. ASCP, which has the largest grassroots network in pathology and laboratory medicine, released in mid-August a grassroots campaign urging ASCP members and others to use the ASCP eAdvocacy Center to urge members of Congress to raise concern with CMS about the proposed Outpatient Prospective Payment System (OPPS) cap. More than 7,000 messages have been sent to officials on Capitol Hill so far. In addition, on Aug. 28, ASCP released a second action alert to encourage individuals to send a message directly to CMS opposing the OPPS cap. Within 24 hours of releasing the CMS alert, almost 3,000 messages had been sent by users of ASCP’s eAdvocacy Center to urge the agency to abandon its OPPS cap proposal. The comments to CMS will be included in the official comment record reviewed by CMS as it works on finalizing the 2014 Physician Fee Schedule.

ASCP continues to urge all interested individuals to contact both CMS and Congress about the proposed cap (Note: The deadline for submitting “official comments” to CMS is Sept. 6).

The Society has also been working closely with the American Medical Association (AMA) and organizations representing pathology and laboratory medicine, such as the College of American Pathologists (CAP) and the American Clinical Laboratory Association (ACLA), to coordinate grassroots and other advocacy efforts to convince CMS that the OPPS cap would have a disproportionately harmful impact on the pathology and laboratory medicine community. ASCP has, along with AMA, CAP, and ACLA, signed a number of letters to CMS raising concern about the OPPS cap. ASCP’s ePolicy will cover ASCP’s official comment letter on the rule in the next edition of ePolicy.

Don’t miss the opinion column (below) commenting on the cumulative impact of CMS’ fee schedule policy changes on pathology and laboratory medicine.


Feds Urge Lab Community to Promote Quality Improvement, Enhanced Interoperability

Improving laboratory quality in diverse settings and advancing laboratory interoperability were discussed at the Clinical Laboratory Improvement Advisory Committee’s (CLIAC) final meeting of the year. Representatives of the U.S. Centers for Disease Control and Prevention (CDC), the U.S. Centers for Medicare and Medicaid Services (CMS), and the Food and Drug Administration (FDA) presented updates on topics, including the national proficiency testing survey, cytology workload assessment and measure, Medical Device User Fee Amendment (MDUFA) III, and the Individualized Quality Control Plan (IQCP). CMS, in partnership with the CDC, also reported on the results of their pilot study regarding the use of the educational booklet, “Ready, Set, Test.” The booklet promotes reliable, high quality testing and enhances patient safety by explaining steps of the waived testing process. It also provides the learner with additional resources to assist on the job. Laboratories who participated in the study indicated that these types of materials are excellent means of improving the quality of laboratory testing.

Organizations such as the Commission on Office Laboratory Accreditation (COLA), The Joint Commission, and the College of American Pathologists (CAP) shared their waived testing initiatives to date. According to COLA, some of the common quality challenges laboratories face include high staff turnover, failure to adequately train personnel and determine if competency is maintained, failure to perform/monitor/respond to quality control as specified, and lack of knowledge or involvement of the laboratory director. Hence, COLA has multiple educational training programs and tools in place to address these issues. However, The Joint Commission conducted a survey of waived testing across healthcare settings and found that “even with well-defined standards, clinical staff struggle with the framework for performing waived tests, especially verifying staff performance.” It also found that “a significant number of findings occur in programs that have no other laboratory review.” Lastly, CAP indicated that waived testing should have oversight consistent to the level of harm the test poses to patients.

CLIAC also distributed the Health and Human Services’ letter of support for the Committee’s four-part recommendation pertaining to the implementation of electronic health records (EHRs). (See CLIAC Letter to Secretary re EHR and ONC Letter to CLIAC re EHR.) The Office of the National Coordinator for Health Information Technology presented its Standards and Interoperability Framework, which outlines relevant activities and multiple work streams under way supporting the Committee’s four-part recommendation. Overall, the presenters at the meeting asked for continued involvement and engagement from other professional laboratory or healthcare organizations.

ASCP continues to monitor developments on waived testing issues and initiatives as well as utilization of EHRs. ASCP supports the implementation of standardized health information technology within the nation’s healthcare system as a means to improve patient care, patient safety, and public health. Pathology informatics will be central to these improvements in health care.

CDC: Waived Testing materials: 
For questions, comments, or to obtain free copies of waived testing materials, contact:
email -; phone - 404-498-2290
CMS: CMS/CLIA Web site: 
          CMS CLIA Central Office: 410-786-3531
          IQCP Link: IQCP@cms.hhs



Prescription for Professional Prosperity: A Call to Arms

Kaitlin Cooke, MPP, Sr. Manager, ASCP Center for Public Policy

Even prior to the passage of the Affordable Care Act (ACA), the pathology and laboratory community has consistently answered the Centers for Medicare and Medicaid Services’ (CMS) call to improve the quality and efficiency of healthcare services delivered and increase patient access to such services.

When CMS called for increased access to pathology and laboratory services…We answered the call

Currently, hospitals heavily outsource laboratory services to independent laboratories. This is especially true for specialized, high-cost/low-volume tests, for which hospitals lack sufficient economies of scale to enable affordable provision when compared with a large specialized laboratory. Moreover, despite continued cuts to reimbursement, the pathology and laboratory community makes sincere efforts to establish, maintain, and sustain service in more small- and medium-sized regional and community independent laboratories. Though this involves disproportionate shouldering of the financial burden of investment when compared with hospital outpatient departments, pathologists remain committed to expanding access to diagnostic services in more local and affordable settings. These smaller laboratories run on a minimum to no-profit margin, enable “stat” and same-day turnaround testing for their clients, and provide services for a disproportionate number of homebound patients as well as patients in rural and nursing home settings.

But CMS hung up the phone…

For CY 2014, CMS has proposed to decrease Medicare reimbursement rates for services provided in stand-alone laboratories and physician offices to CY 2013 reimbursement rates in hospital outpatient departments. This proposal does not acknowledge that these laboratory and physician office facilities are tasked with providing the same overhead resources as hospital outpatient departments, but are unable to leverage hospital resources and benefit from spreading the cost of investment across a much larger cost pool. Given that Medicare reimbursement provides roughly 30 percent of the revenue in these non-hospital-based laboratories, the Medicare reimbursement cuts are anticipated to impose significant financial strain that will only further exacerbate existing financial strains. In response to reimbursement cuts implemented in 2011 and 2012, small and medium-sized regional and community laboratories have already been forced to implement reductions in their number of employees, hours, services, nursing home clients, and profit margins. Now, following these additional proposed cuts, these already financially vulnerable institutions may need to further downsize or even close. This could further promulgate consolidation of independent laboratories, thereby minimizing competition and driving up costs. This could also result in a shift in the delivery of laboratory services to the hospital outpatient setting, which is currently ill-equipped to provide the full menu of laboratory services provided across all specialized independent laboratories. Both of these effects threaten access to these crucial services.

When CMS called for an enhanced focus on prevention…We answered the call

For years, pathologists have played a crucial role in prevention, in that early detection and accurate diagnosis may prevent disease progression. However, now pathologists can perform genetic testing for more than 1,700 diseases, which allows them to assess genetic predisposition for a specific disease type at the molecular level. This enables personalized prevention at an unprecedented early stage, prior to disease onset, while also providing a personalized approach to treatment options, following disease onset.

But CMS hung up the phone…

In establishing the new molecular pathology CPT codes for CY 2013, CMS did not carry over previous CPT code values. Now they are relying on local Medicare Administrative Contractors (MACs) to value these services via a gap-filling methodology that has historically proven to be extremely time-consuming for far less numbers of codes than the 114 molecular pathology codes currently up for review. Additionally, the pathology and laboratory community fears that MACs are not able to easily value these services because their value has previously been bundled in stacked coding methodology. As such, pathologists are experiencing a delay in reimbursement for molecular pathology services that is expected to continue until local coverage decisions are made. Moreover, many in the pathology community fear that some of the MACs may overexert their authority to not just set payment rates, but to also reassess whether or not these services should be covered under Medicare as “reasonable and necessary.” This may severely threaten Medicare beneficiary access to molecular pathology services and will likely encourage private payors to follow suit.

Now CMS’s CY 2014 proposal to reassess the value of all codes on the Clinical Laboratory Fee Schedule (CLFS) based on technological changes presents similar concerns. As such, the magnitude of this task may cause significant delays in reimbursement for all medical laboratory services, not just molecular pathology services. While MACs have been unable to value 114 molecular pathology codes at the local level this past year, CMS’s proposal to revalue 1,250 codes at the national level over the course of five years does not seem feasible and amplifies concerns for service reimbursement delays. This threatens pathologists’ ability to prevent not only disease onset, but now also disease progression.

When CMS called for electronic quality reporting and quality improvement…We answered the call

For more than three decades now, laboratories have enabled electronic transmission of test results. As such, they are uniquely positioned to assist providers in their participation in the Meaningful Use (MU) of Electronic Health Records (EHRs) program. However, laboratories are not only assisting providers in their efforts to electronically integrate information across practice locations in a uniform format, but they are now often required to gift EHR systems to providers. As a result, the laboratory community has urged CMS to acknowledge this unfair, and often forced, exchange in violation of the Stark Act.

But CMS hung up the phone…

In response to laboratory community concerns, CMS did not deem exchange of referrals for EHR systems a violation of the Stark Act and instead continues to create quality reporting incentive programs that do not (adequately) target pathologists for reward. Nonetheless, laboratories continue to fund a substantial sum of EHRs for provider practices that do qualify for MU program incentive payments while pathologists remain responsible for inputting more than 50 percent of an EHR’s contents in the form of laboratory test results. However, pathologists are unable to participate in the MU program because the measures and processes are much more aligned with a primary care provider’s practice. As such, pathologists do not qualify for incentive payments. Pathologists encounter similar challenges in the Physician Quality Reporting System (PQRS). Very few measures target their specialty, making it difficult to meet PQRS requirements, qualify for PQRS incentive payments, and avoid PQRS payment adjustments. Additionally, the implications of pathologists’ failure to meet PQRS requirements will be further exacerbated this year by inhibiting incentive payments and resulting in additional negative payment adjustments under the Value-based Payment Modifier (VM) program.

Now it’s time that Pathologists give CMS a call back! Join ASCP in encouraging CMS to:

  1. Withdraw its proposal to cap reimbursement rates for pathology services delivered in physician offices at reimbursement rates for pathology services delivered in outpatient hospital departments (Alert CMS Now!: );
  2. Abandon its proposal to revalue codes on the CLFS in its current form; and
  3. Encourage CMS to approve additional proposed pathology-focused measures for PQRS and support an extension of the five-year hardship exemption from payment adjustments under the MU program.

Kaitlin Cooke joins ASCP with a Master’s of Public Policy from the Georgetown Public Policy Institute. Having served on the Senate Finance Committee during the drafting of the ACA, she brings firsthand knowledge on the intended ideals for successful healthcare reform implementation. Her most recent endeavor involved navigating the post-ACA regulatory terrain on behalf of over 5,000 providers as a Legislative Analyst and Correspondent at the University of Pittsburgh Medical Center (UPMC). Ms. Cooke looks forward to infusing her in-depth policy knowledge into targeted and substantive advocacy efforts on behalf of ASCP members.


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