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ePolicy News October 2012

Monday, October 1, 2012



CMS Provides Pathologists Temporary Relief from Meaningful Use Penalties

The U.S. Centers for Medicare and Medicaid Services (CMS) will shield pathologists, at least temporarily, from the Meaningful Use program’s noncompliance penalties that go into effect in 2015. The relief was provided as part of the agency’s Meaningful Use Stage Two Final Rule, released in late August at ASCP’s urging. The rule also provides protection for radiologists and anesthesiologists.

The final rule outlines requirements for physicians to comply with the Electronic Health Records Incentive Program requirements which, like the Physician Quality Reporting System, provide incentive bonuses and negative payment adjustments for eligible physicians.

In its comments on the Stage II proposed rule, ASCP urged the agency to spare pathologists from negative payment adjustments as these adjustments are not triggered by intentional noncompliance on the part of pathologists. Rather, the penalties occur because the rule is configured in a way that makes it virtually impossible for pathologists to meet the reporting requirements. The program’s reporting criteria is crafted to report data, such as tobacco use and vital signs, which can only be secured from direct patient contact.

Pathologists should be aware that CMS can only provide temporary relief. For pathologists to secure permanent relief, Congress must enact legislation. Currently, the Health Information Technology Reform Act (H.R. 4066) has been introduced, which would exempt pathologists from eligibility for both Meaningful Use penalties and incentives. ASCP will soon issue an action alert to encourage its enactment by Congress.


ASCP Tells CMS New Molecular Pathology Codes Belong on PFS

On Sept. 4, ASCP urged the U.S. Centers for Medicare and Medicaid Services (CMS) to place the new molecular pathology CPT codes on the Physician Fee Schedule (PFS) for 2013. ASCP’s request was part of the Society’s comments on the 2013 Physician Fee Schedule proposed rule. In addition, ASCP raised concern about the agency’s Physician Quality Reporting System (PQRS), although the Society supported the adoption of five pathology-related reporting measures.

The biggest issue in the rule for pathology was the fee schedule placement of a new set of more than 100 CPT codes pertaining to molecular pathology services. The new codes are intended to replace the current molecular pathology stacking codes, which will be discontinued on Jan. 1, 2013. Consistent with past policy, ASCP urged that these codes be placed on the PFS. ASCP also urged CMS to adopt recommendations of the American Medical Association (AMA), AMA/Specialty Society Relative Value Scale Update Committee (RUC), and the College of American Pathology (CAP) to develop national relative value units and national payment rates for the new molecular pathology codes.

One potential problem with placing these codes on the PFS relates to the ability of scientists with doctorate degrees (known as clinical scientists), who provide professional interpretations of these procedures. ASCP has lobbied Congress this past year to allow clinical scientists to bill for Molecular Diagnostics Interpretive Services reimbursed under the physician fee schedule. In the interim, ASCP urged CMS to establish a G-code to allow clinical scientists to bill for their professional services for codes placed on the PFS. This would enable clinical scientists to continue to bill for their professional services until Congress could authorize these laboratory professionals with billing authority.

With regard to PQRS, ASCP expressed concern about several of the agency’s plans for this program. The program provides a combination of incentive bonuses and negative payment adjustments to eligible professionals (EPs), and group practices, depending on their reporting of applicable quality measures. The program will provide an incentive payment of 0.5 percent for compliance through 2014, but will begin imposing negative payment adjustments of 1.5 percent in 2015 for noncompliance.

Though ASCP supported the adoption of five measures intended for pathologists to use beginning in 2013, ASCP raised concern that there aren’t enough measures to allow all pathologists to meet the reporting requirements before 2015. ASCP argued that assessing penalties on physicians, when PQRS lacks sufficient metrics to allow all physicians to satisfactorily report quality metrics, is inappropriate, unfair, and poor public policy.

The five measures are as follows: 1. Breast Cancer Resection Pathology Reporting (#99); 2. Colorectal Cancer Resection Pathology Reporting (#100); 3. Barrett’s Esophagus (#249); 4. Radical Prostatectomy Pathology Reporting (#250); and 5. Immunohistochemical (IHC) Evaluation of HER2 for Breast Cancer Patients (#251). Additionally, ASCP urged CMS to expand the definition of a group practice for the Group Practice Reporting Option (GPRO) to include practices with two or more EPs using a single tax identification number to enable more pathologists to participate in the program.

Among the other issues addressed, ASCP raised concern about CMS proposals to 1. expand its Multiple Procedure Payment Reduction restrictions; 2. revisit the payment designated for CPT 88348, Electron Microscopy, due to a belief the procedure is misvalued; and 3. revisit the physician signature requirement on requisitions for laboratory tests. With regard to the physician signature requirement, CMS has signaled the proposal was not intended to address requests for clinical laboratory tests, and that this will be clarified in the final rule.


FDA’s Proposed Rule on Medical Device UDI System Impacts Laboratory

The U. S. Food and Drug Administration has issued a proposed rule on medical unique device identifiers (UDI) that will cover many products currently used by medical laboratories. The new system is an effort to improve efficiency and patient safety by streamlining recall and adverse event reporting, reducing medical errors, and establishing standards for electronic health records device data entry.

The proposed UDI system will operate much like the Universal Product Code (UPC) system currently does in the retail industry. A patient’s use of a particular medical product will be recorded by scanning its bar code. The scan will transfer the data to the patient’s EHR, bill the patient, and send a notice to refill the product.

Under the proposed rule, devices deemed high risk will carry the new codes within a year. For other medical devices, the UDI system will be phased in gradually over a 10-year period. Implementation of the new systems is expected to cost more than $500 million over the next decade.




Sequestration Threatens Defense, Health Care … Cuts Could Be Devastating

As Congress wrestles with the deficit in a pre-election climate, Congressional leaders face an even bigger challenge—sequestration. The term refers to a new fiscal policy procedure, whereby the amount of money equal to the difference between the cap set in the Budget Resolution and the amount actually appropriated is “sequestered” by the Treasury and not handed over to the agencies to which it was originally appropriated by Congress.

In theory, every agency has the same percentage of its appropriation withheld in order to take back the excessive spending “across the board.” However, Congress has chosen to exempt certain very large programs from the sequestration process—for example, Social Security and certain parts of the Defense budget—and the number of exempted programs has tended to increase over time. This means sequestration would take back gigantic shares of the budgets of the remaining programs to achieve the total cutbacks required, crippling the activities of the unexempted programs.

Currently on the table are sequestration cuts exceeding $1 trillion in automatic spending cuts over a 10-year period, to be shared among defense and nondefense spending accounts, such as healthcare programs. The cuts are scheduled to take effect on Jan. 2, 2013, if Congress cannot reach a bipartisan compromise.

For example, there could be tremendous cuts to Title VII, allied health professions programs, and Title VIII, nursing programs. ASCP has signed a Congressional letter, circulated by the Health Professions Nursing Education Coalition (HPNEC), outlining the negative impact of sequestration on these programs, which could be cut by as much as 8.2 percent.

ASCP will continue to monitor these budget cuts and will report them in future editions of ePolicy News.


Congressional Act Examines Lab Tests, Looks at CLIA Revision

HR 6118, the Taking Essential Steps for Testing Act (TEST), was originally introduced in the House of Representatives by Rep. Michael Grimm,, R-N.Y., with co-sponsors Rep. Peter Roskam, R-Ill., Rep. Mike Ross, D-Ark., and Rep. Steve Womack, R-Ark. The legislation is designed to enhance the Clinical Laboratory Improvement Amendments (CLIA) flexibility regarding sanctions for clinical laboratories that intentionally refer proficiency testing samples required for certification to another laboratory for analysis. It would 1. give the U.S. Secretary of Health and Human Services the discretion to substitute intermediate sanctions for such violations instead of the two-year prohibition against ownership or operation, which would otherwise apply, and 2. make the one-year certificate revocation for such a laboratory optional rather than mandatory. The measure has passed the U.S. House of Representatives and is currently under consideration in the U.S. Senate. The measure could be favorably considered by the Senate during this lame duck Congressional session.  



Plaintiffs in Gene Patent Lawsuit Petition Supreme Court a Second Time

The American Civil Liberties Union (ACLU) and the Public Patent Foundation (PUBPAT) have petitioned the Supreme Court for a second time to review Myriad Genetics Inc.’s ability to patent two genes associated with hereditary breast and ovarian cancer. The petition represents the latest chapter in an ongoing lawsuit challenging the legality of gene patents. In 2009, the ACLU, representing numerous clients, including ASCP, sued Myriad Genetics and the U.S. Patent and Trademark Office (USPTO). The plaintiffs argue that patents on human genes, which are “products of nature,” violate the First Amendment and patent law. Furthermore, such patents interfere with medical treatment and stifle scientific research.

ACLU and PUBPAT are seeking a high court review of the recent divided federal appeals court decision reaffirming its previous ruling to uphold Myriad Genetics’ right to patent BRCA1 and BRCA2, two genes linked to increased rates of breast and ovarian cancer. The patents allow Myriad to be the exclusive U.S. commercial provider of screening assays for these genes and permit the company to determine the terms and price for testing, making it impossible for women to access alternate tests or obtain a second opinion about their results. The patents also give Myriad the authority to prohibit researchers from investigating these genes without first gaining permission.

The appeals court issued a similar ruling last year but was ordered by the U.S. Supreme Court earlier this year to reconsider the Myriad case, in light of its recent ruling against patents on a different, nongenetic diagnostic test. In this case, patents were rendered invalid because they merely reiterated “laws of nature.”

In its latest petition to the Supreme Court, the ACLU and PUBPAT maintain the “central issue” is the patentability of human genes. “DNA occurs naturally in the human body and cannot be patented by a single company that can then use its patents to limit scientific research and the free exchange of ideas,” wrote Chris Hansen, staff attorney with the ACLU Speech, Privacy and Technology Project.

A decision by the Supreme Court to hear the case is not expected for several months. ASCP will report any developments in upcoming editions of ePolicy News.




ASCP Submits Final Veto Request to New York Governor

On Sept. 25, ASCP wrote to New York Gov. Andrew M. Cuomo, urging him to veto A3551, which would roll back New York’s physician self-referral law to defer to the weaker federal Stark Law. The measure would increase the ability of New York physicians to exploit patients through the self-referral of such physician services as anatomic pathology, radiology, radiation therapy, and physical therapy. In writing the Governor, ASCP also submitted a letter signed by more than 150 ASCP members in New York, urging the bill be vetoed. The legislation was forwarded to the Governor on Sept. 21. The Governor is expected to make a decision on ASCP’s veto request within a few weeks.




Health Policy Brief Improving Care Transitions Released

In the September 2012 online issue of Health Affairs, the Robert Wood Johnson Foundation and Health Affairs released a policy brief on how to improve the quality of care through better coordination of care transitions. The article states that poor care transition of patients from a hospital to their homes or a skilled nursing facility contributes to “diminished health and increased cost.” Patients who are discharged from a hospital are left with little information on how to care for themselves, causing readmission and a $25 to $45 billion wasteful spending in 2011 alone.

Several root causes were mentioned in the article, notably the difficulties in transmission of patient health records between hospitals and physician practices due to differences in computer systems. Many of the physicians who receive the health records lack key information, leading to unnecessary ordering of tests and inadequate treatment plans. Some analysts believe Medicare’s and Medicaid’s payment policies “unintentionally created incentives to unnecessarily transfer patients back and forth between hospitals and nursing homes.” There are, however, some care transition models currently place that demonstrate an approximately 30-percent reduction in readmission and a 39-percent reduction in cost per patient. The Affordable Care Act will also offer health providers with incentives for improved care transition coordination and penalties for those who have readmissions that exceed a particular target number.

Some programs and initiatives are already in place to reduce readmission of patients and save healthcare costs. Yet there is much work remaining. The article indicates that interest in improving care transitions to reduce Medicare spending is likely to grow.

ASCP believes that to improve cost savings, quality of care, and the patient care experience, these patient care delivery models should fully use and incorporate into their administrative structure pathologists and advanced certified laboratory professionals to identify inappropriate, unnecessary, and/or duplicative testing.

For link to the policy brief: 


Issue Brief from the Alliance for Integrity in Medicare

The Alliance for Integrity in Medicare (AIM), an alliance of medical specialty organizations representing pathology and laboratory medicine, radiology, radiation oncology, and physical therapy, recently released an issue brief on self-referral reform. The issue brief provides an overview of the federal Stark Self-Referral Law and the loopholes leading to billing abuses by clinicians, self-referring pathologists, and other physician services. The brief includes a discussion of the solution sought by ASCP and other members of the Alliance, as well as a review of some of the major studies documenting the ill-effects of self-referral arrangements. To access the issue brief, click here. ASCP is an original member of AIM.


IOM Releases Report on Best Care at Lower Costs:
The Path to Continuously Learning Health Care in America

Last year, the Institute of Medicine (IOM) formed a committee for the Learning Healthcare System in America project to “explore the most fundamental challenges to health care today and to propose actions that can help achieve a healthcare system characterized by continuous learning and improvement.” The committee’s report, Best Care at Lower Cost: The path to continuously learning health care in America, was released last month. The IOM has held a meeting to discuss the group’s findings and how the transformation of health care is needed to improve care and reduce cost. The group identified three imperatives that could provide the best care at lower cost:

  1. Managing rapidly increasing complexity—in treatment, diagnostic, and care management;
  2. Achieving greater value in health care; and
  3. Capturing opportunities from technology, industry, and policy.

As diagnostic and treatment options expand at an exponential rate, patients and clinicians are facing challenges in keeping up with new knowledge that contributes to the effectiveness of healthcare delivery. Furthermore, current IOM data indicates that the No. 1 source of excess cost ($210 billion) in health care is unnecessary services, such as overuse—beyond evidence-established levels, discretionary use beyond benchmarks, and unnecessary choice of higher-cost services.

With the increasing amount of health information that contributes to the complexity of healthcare delivery, some of the Committee’s recommendations include: improvements in data utility, patient-centered care, community links, and a supportive policy environment. ASCP supports the goal of providing health care at a lower cost and will continue to participate in meetings that discuss this issue.

For link to the meeting and meeting materials: 


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