- Joined
- Sep 9, 2004
- Messages
- 7,132
- Reaction score
- 1,255
Came over the wire late PST this evening:
FEDERAL
2007 Physician Fee Schedule Released: Good and Bad News for Pathology
The Centers for Medicare and Medicaid Services (CMS) recently released the proposed physician fee schedule for 2007. The proposed rule contains a negative 5.1% update due to the sustainable growth rate (SGR) formula under Medicare. ASCP will be working with the laboratory/pathology community and other medical organizations, such as the American Medical Association (AMA), to prevent implementation of this negative update. ASCP is also pleased to report that CMS will be making changes to prevent billing abuses by pod or condo labs.
SGR -- Ripple Effect Hurts Pathologists and the Laboratory Team
The negative 5.1% update is worse than CMS had projected earlier in the year. If the SGR is implemented, it will have a devastating effect not only on pathologists but the entire laboratory team and patients. The ripple effect of a decrease in Medicare payments of this magnitude are hard to estimate but this would mean fewer dollars for laboratory medicine and perhaps reduced access to testing services as some physicians may reduce or terminate the number of Medicare patients they serve.
The Silver Lining: Pod and Condo Laboratories Targeted in Self-Referral Rules
ASCP is pleased to report that CMS has responded to concerns from ASCP, CAP and other laboratory organizations regarding the proliferation of pod or condo laboratories. In its proposed 2007 physician fee schedule, the agency outlines several changes to end the potentially abusive billing arrangements. The proposed rule would also clarify that the reassignment of benefits rules pertaining to contractual arrangements are subject to program integrity safeguards relating to the right of payment for diagnostic testing.
Pod laboratories seek to exploit a loophole in Medicares assignment of benefit regulations that date back to the agencys 2005 physician fee schedule. CMS, in response to several changes brought about by the Medicare Prescription Drug, Improvement and Modernization Act (MMA), relaxed the requirement that an independent contractor physician or non-physician could reassign Medicare billing privileges to a health care entity. Previous rules had allowed the reassignment of benefits only for those services performed on-site. The change also allowed reassignment for off-site services.
In response, ASCP and other pathology and laboratory organizations urged CMS to closely monitor reassignment arrangements for potential program abuse. Commenting on the rule in 2004, ASCP urged CMS in a letter to monitor reassignments to detect and deter fraudulent or abusive practices. CMS should also clarify that these new provisions do not override existing self-referral or anti-kickback prohibitions. ASCP also raised concerns about the increasing prevalence of "pod" or condo laboratories, as they may violate the Stark anti-referral and/or anti-kickback provisions.
In its 2007 physician fee schedule proposed rule, CMS proposed to amend its provisions for payment of the technical component to deter abuse. As a result, when a reassignment involves a contractual arrangement with a physician or other supplier who performs the test, payment may not exceed the lowest of the following amounts: the physician or other suppliers net charge to the billing physician or medical group; the billing physicians or medical groups actual charge; or the fee schedule amount for the service that would be allowed if the physician or other supplier billed directly.
In addition, CMS will change its rules so that when billing for the technical component, the billing entity would be required to perform the interpretation. CMS is also proposing changes to the definition of a centralized building to restrict the types of space ownership or leasing arrangements that would qualify for purposes of the physician self-referral in-office ancillary services exception and physician services exception. CMS will require these spaces to contain, on a permanent basis, the necessary equipment to perform substantially all the designated health services that are performed in the space. CMS believes, and ASCP certainly hopes, that these changes will prevent abusive contractual arrangements by making it prohibitively expensive for pod laboratories to continue operating. ASCP applauds CMS efforts to rein in this abusive practice.
Technical Component (TC) Grandfather Provisions to Take Effect
CMS indicated in the rule that they will terminate the TC grandfather provisions on December 31, 2006. This is a follow-up to previous CMS intentions to pay only the hospital for the TC of physician pathology services furnished to hospital patients. ASCP will object to this change in its comments and join with the College of American Pathologists (CAP) as it leads the charge for a legislative fix to this problem.
LADOC to Clinicians:
You can't win, Darth. If you strike me down, I shall become more powerful than you can possibly imagine.
FEDERAL
2007 Physician Fee Schedule Released: Good and Bad News for Pathology
The Centers for Medicare and Medicaid Services (CMS) recently released the proposed physician fee schedule for 2007. The proposed rule contains a negative 5.1% update due to the sustainable growth rate (SGR) formula under Medicare. ASCP will be working with the laboratory/pathology community and other medical organizations, such as the American Medical Association (AMA), to prevent implementation of this negative update. ASCP is also pleased to report that CMS will be making changes to prevent billing abuses by pod or condo labs.
SGR -- Ripple Effect Hurts Pathologists and the Laboratory Team
The negative 5.1% update is worse than CMS had projected earlier in the year. If the SGR is implemented, it will have a devastating effect not only on pathologists but the entire laboratory team and patients. The ripple effect of a decrease in Medicare payments of this magnitude are hard to estimate but this would mean fewer dollars for laboratory medicine and perhaps reduced access to testing services as some physicians may reduce or terminate the number of Medicare patients they serve.
The Silver Lining: Pod and Condo Laboratories Targeted in Self-Referral Rules
ASCP is pleased to report that CMS has responded to concerns from ASCP, CAP and other laboratory organizations regarding the proliferation of pod or condo laboratories. In its proposed 2007 physician fee schedule, the agency outlines several changes to end the potentially abusive billing arrangements. The proposed rule would also clarify that the reassignment of benefits rules pertaining to contractual arrangements are subject to program integrity safeguards relating to the right of payment for diagnostic testing.
Pod laboratories seek to exploit a loophole in Medicares assignment of benefit regulations that date back to the agencys 2005 physician fee schedule. CMS, in response to several changes brought about by the Medicare Prescription Drug, Improvement and Modernization Act (MMA), relaxed the requirement that an independent contractor physician or non-physician could reassign Medicare billing privileges to a health care entity. Previous rules had allowed the reassignment of benefits only for those services performed on-site. The change also allowed reassignment for off-site services.
In response, ASCP and other pathology and laboratory organizations urged CMS to closely monitor reassignment arrangements for potential program abuse. Commenting on the rule in 2004, ASCP urged CMS in a letter to monitor reassignments to detect and deter fraudulent or abusive practices. CMS should also clarify that these new provisions do not override existing self-referral or anti-kickback prohibitions. ASCP also raised concerns about the increasing prevalence of "pod" or condo laboratories, as they may violate the Stark anti-referral and/or anti-kickback provisions.
In its 2007 physician fee schedule proposed rule, CMS proposed to amend its provisions for payment of the technical component to deter abuse. As a result, when a reassignment involves a contractual arrangement with a physician or other supplier who performs the test, payment may not exceed the lowest of the following amounts: the physician or other suppliers net charge to the billing physician or medical group; the billing physicians or medical groups actual charge; or the fee schedule amount for the service that would be allowed if the physician or other supplier billed directly.
In addition, CMS will change its rules so that when billing for the technical component, the billing entity would be required to perform the interpretation. CMS is also proposing changes to the definition of a centralized building to restrict the types of space ownership or leasing arrangements that would qualify for purposes of the physician self-referral in-office ancillary services exception and physician services exception. CMS will require these spaces to contain, on a permanent basis, the necessary equipment to perform substantially all the designated health services that are performed in the space. CMS believes, and ASCP certainly hopes, that these changes will prevent abusive contractual arrangements by making it prohibitively expensive for pod laboratories to continue operating. ASCP applauds CMS efforts to rein in this abusive practice.
Technical Component (TC) Grandfather Provisions to Take Effect
CMS indicated in the rule that they will terminate the TC grandfather provisions on December 31, 2006. This is a follow-up to previous CMS intentions to pay only the hospital for the TC of physician pathology services furnished to hospital patients. ASCP will object to this change in its comments and join with the College of American Pathologists (CAP) as it leads the charge for a legislative fix to this problem.
LADOC to Clinicians:
You can't win, Darth. If you strike me down, I shall become more powerful than you can possibly imagine.
