ePolicy November 2018 Special Edition

November 09, 2018










CMS Responds to ASCP Concerns on PFS, CLFS, QPP Final Rule

On Nov. 1, the Centers for Medicare and Medicaid Services (CMS) released its CY 2019 Final Rule on the Physician Fee Schedule (PFS). The rule outlines policy changes for the PFS, Clinical Laboratory Fee Schedule (CLFS), and the Quality Payment Program (QPP). This article focuses on the PFS and CLFS policy changes.

Overall, CMS estimates that changes to the PFS will result in a two-percent decrease on reimbursements for pathologists and independent laboratories. The changes in reimbursement rates for pathologists is largely attributable to shifts in practice expense (PE) relative value units (RVUs) while the changes for independent laboratories is attributable to changes in the technical component direct PE RVUs. Because independent clinical laboratories receive approximately 83 percent of their revenues from the CLFS, the changes in PFS reimbursement rates do not have as much impact as they do for pathologists.

One of the most anticipated policy changes in the Final Rule concerns CMS policies for repricing of the CLFS due to the statutory requirements of the Protecting Access to Medicare Act (PAMA). This statute required the Agency to calculate new payment rates based on payment data submitted by clinical laboratories. ASCP has been pushing the Agency to reconsider its definition of an applicable laboratory for purposes of determining which labs must report data.

CMS’s current rules generally bar hospital laboratories from reporting pricing data. Because hospital laboratories typically receive higher reimbursement rates than independent labs, CMS’s exclusion of their payment data is suppressing CLFS payment rates. Since many private payers follow CMS’s lead on CLFS reimbursement rates, the financial impact is not limited to Medicare CLFS payments. In the Final Rule, CMS adopted two policy changes advocated for by ASCP. ASCP had urged CMS to remove Medicare Advantage revenues from the definitions test and to use Form CMS1450 14x bill types to identify hospitals laboratories with significant outreach revenues. The policy shift should result in CLFS rates more closely resembling true market rates for laboratory tests.

One notable change in the PFS involved reimbursement for CT code 85060 (Blood Smear Interpretation). In the proposed rule, CMS had proposed a 20-percent cut in reimbursement, which ASCP strongly opposed. In the Final Rule, CMS followed ASCP’s recommendation and rescinded the proposed cut. ASCP also urged CMS to restore cuts to CPT code 85097 (Bone Marrow Interpretation), which CMS was proposing to cut by 19 percent. CMS, unfortunately, did not follow ASCP’s recommendation.

Another of the high profile issues CMS tackled in its Final rule concerned the Medicare Evaluation and Management (E&M) Services. ASCP worked with the American Medical Association and a coalition of interested medical specialty organizations to support delayed implementation of the Agency’s proposals. ASCP is pleased CMS followed our recommendations and will delay implementation of its policy proposals until at least 2021. Until then, ASCP will work with the AMA and others to pursue more favorable E&M policies.



CMS Finalizes Changes to the Medicare Quality Payment Program to Further Reduce Reporting Burden for Pathologists

On Nov. 1, CMS released its Final Rule on the Quality Payment Program (QPP) for Year 3. The Year 3 rule updates include efforts to reduce overall burden on clinicians, improve patient outcomes, improve quality through meaningful measures, and expand participation options to include other provider types. CMS has continued to focus on meaningful quality outcomes for patients and to identify measures that are high value or high priority. As part of this effort, CMS recently awarded seven cooperative agreements to external organizations, including ASCP, to develop and implement measures to improve patient care through the QPP.

In this year’s QPP Final Rule, CMS finalized the removal of three pathology-specific measures: Breast Cancer Resection Reporting, Colon Cancer Resection Reporting, and Quantitative Immunohistochemical Evaluation of Human Epidermal Factor Receptor 2 (HER2) Testing in Breast Cancer Patients Breast Cancer Resection Reporting. CMS notes that the breast cancer and colon cancer measures have become a standard of care and, therefore, have limited opportunity to improve clinical care.

ASCP advocated for several policy changes during the QPP comment period to allow pathologists and other non-patient facing clinicians to more meaningfully participate in the QPP. Additional changes in the Final Rule that impact pathologists include:

  • the ability to submit a combination of collection types for the quality category;   
  • the addition of a third low-volume threshold criterion to determine whether individuals or groups are excluded from participating in the Merit-based Incentive Payment System (MIPS);      
  • an increase in the MIPS performance threshold from 15 points to 30 points;      
  • a change in the weights of the quality and cost categories in the MIPS final score; and      
  • the ability of facility-based clinicians to use their facility’s Value-Based Purchasing score in place of their MIPS quality and cost score.      

Further, ASCP is pleased that CMS decided not to move forward with a provision that would require Qualified Clinical Data Registry (QCDR) measure owners to enter into a license agreement with CMS such that once a QCDR measure is approved for reporting in MIPS. Under the proposed provision, CMS would have required Qualified Clinical Data Registry (QCDR) measure owners to make their measures available to other QCDRs without the need to secure a license with, or pay a fee to, the measure owner. We believe that this provision could potentially undermine the intellectual property rights of measure stewards and agree with CMS’s decision not to finalize this proposal.

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