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The Centers for Medicare & Medicaid Services (CMS) published the first of its additional guidance documents to laboratories clarifying obligations under the Protecting Access to Medicare Act of 2014 (PAMA). The first PAMA guidance document focuses on the collection and reporting of data beginning January 1, 2017, including determining whether a laboratory is required to report private payer data.

The CAP has engaged and shared several concerns with the CMS and other stakeholders on the implementation of changes to the clinical laboratory fee schedule (CLFS) that are required by PAMA. Regarding applicable laboratories and data to be reported, the CAP has objected to the limited scope of entities required to submit private payer data that will be used to established CLFS payment rates beginning in 2016. The CAP has also advocated for clarity and administrative ease in reporting of data.

The guidance, issued July 20, sets to clarify what data applicable laboratories and reporting entities must collect and report to the CMS, the data collection and reporting periods, and the implementation schedule. Additional information on the data collection system and advanced diagnostic laboratory tests will be issued through separate guidance, says the CMS.

Which Laboratories Should Report Data

According to the July 20 guidance, there are four steps in determining whether a laboratory meets the requirement to be an applicable laboratory:

  1. Is the laboratory certified under CLIA (including CLIA certificate of waiver)?
  2. Does it bill Medicare Part B under its own national provider identifier (NPI)?
  3. Does the laboratory meet the Medicare majority of revenues threshold under PAMA and
  4. Does the laboratory meet the low-expenditure threshold (that is, does it receive as least $12,500 in Medicare revenues from the CLFS under Part B)?

The guidance provides three steps for determining if a laboratory meets the majority of Medicare revenues threshold under PAMA because it receives more than 50% of its total Medicare revenues from payments under the Medicare CLFS and/or Medicare physician fee schedule.

The CMS provided several examples on determining whether a laboratory will be required to report its private payer data including how to determine if a laboratory meets the majority of Medicare revenues threshold. The threshold is achieved if the billing NPI receives more than 50% of its total Medicare revenues from payments under the Medicare CLFS and/or Medicare physician fee schedule based on final paid claims during the data collection period.

Applicable laboratories will be required to report the specific HCPCS code associated with each test, the private payer rate for each test for which final payment has been made during the collection period, and the associated volume for each test. Among some key points regarding what must be reported are:

  • Final payments from secondary insurance payers would also be considered in calculating private payer rates.
  • If there are multiple rates from the same private payer for the same test, each rate must be reported.
  • Private payer rates for out-of-network laboratories are included.
  • Price concessions (eg, if a lab waives a deductible or copay/coinsurance) are not to be reported.
  • Remittances where the payer has grouped test-level payments into an encounter or claims-level payment are not reported.

The schedule for data collection and reporting is the same as what was listed in the June 17 final rule: the first data collection period from January 1, 2016, through June 30, 2016, and the first data reporting period from January 1, 2017, through March 31, 2017.

The CAP will continue to keep members informed on subsequent PAMA guidance the CMS expects to release in the near future.

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Registration is now open for key CAP policy and advocacy courses and roundtable discussions important to the pathology specialty during CAP16 in Las Vegas September 25-28.

Ensure you can attend "MACRA, Pay for Performance and the Physician Fee Schedule—You Can Run But You Can't Hide" (S1620) by registering and selecting this popular course today. During this featured presentation, attendees will learn the purpose of new pay-for-performance programs and delivery system reform culminating in the enactment and implementation of the Medicare Access and CHIP Reauthorization Act (MACRA). Experts will explain which pathologists are subject to, and ways to successfully participate in, the merit-based incentive payment system and alternative payment model pathways. The potential ramifications for not participating will also be discussed.

The session starts at 8 AM on Monday, September 26. Register for S1620 MACRA, Pay for Performance and the Physician Fee Schedule—You Can Run But You Can't Hide today.

Additional CAP advocacy courses and roundtable discussions are also available at CAP16:

  • M1596 How is My Payment Determined for Pathology Services?
    Sunday, September 25, 1-2 PM
  • R1690 My Surgical Pathology and Cytopathology Coding Dilemmas: Getting It Right
    Monday, September 26, Noon to 1 PM
  • STA001 "How Data Drives CAP Advocacy: What Pathologists are Saying about the Economics of Pathology Practice"
    Monday, September 26, 5:30-6:30 PM
  • R1691 Current Payment Policy Challenges in Pathology Practice
    Tuesday, September 27, Noon to 1 PM

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Action is key to protecting the practice of pathology, believes Daniel Herman, MD, PhD, who as a pathology resident from Seattle, WA attended the 2016 Policy Meeting in Washington, DC, with the help of the CAP's Leadership Development Award.

The Leadership Development Award, sponsored by the CAP Foundation, provides funding to cover travel expenses of up to $1,200 to attend the CAP Residents Forum or CAP Policy Meeting. The award is designed to help introduce pathology residents to the specialty's issues and leadership opportunities.

All CAP Junior Members may apply for the award, and applicants should have authorization from their institution to attend the meetings. Awardees and/or their institutions should expect to cover any travel costs that exceed the amount awarded. The deadline to submit an application for the award is February 3.

Dr. Herman, who trained at the University of Washington and is now an Assistant Professor at the University of Pennsylvania, said he appreciated the opportunity to meet pathologists from around the country "who are motivated to advocate for our profession and our patients." In particular, he enjoyed Harold Miller's presentation "because he pushed me to think about how to develop pathology-initiated alternative payment models, rather than to sit back and allow others to build such models for us." Miller is president and CEO of the Center for Healthcare Quality and Payment Reform.

Among the issues that Dr. Herman said he learned about at the policy meeting were the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and value-based care; the Protecting Access to Medicare Act of 2014 (PAMA) and laboratory reimbursement; regulation of laboratory-developed tests (LDTs); and local coverage determinations.

"The primary things that I took away from the meeting were knowledge and a better appreciation for the importance of action," says Dr. Herman. "I plan to share the topics discussed with colleagues and impress upon them the importance of participation. In particular, I hope to work with local colleagues toward better quantifying and qualifying the contributions of our specialty in medical practice, as a means toward maintaining our scope of practice, and potentially an avenue toward pathology-focused APMs [alternative payment models]. In addition, I plan to work with the CAP through its Council on Government and Professional Affairs to ensure that upcoming LDT regulation does not restrict the practice of medicine by making it impractical to change diagnostic practice when medical knowledge improves."

Dr. Herman added that the CAP Policy Meeting is a fantastic experience for any trainee interested in health care policy, noting that the policy landscape is changing rapidly and that there are a myriad of issues, both existing policies and proposals being drafted, that are critical to the practice of medicine.

"Health care practitioners are sorely underrepresented in the discussions informing these policies," he said. "It is critical that we, as pathologists, actively participate in these conversations to help shape the future of medical practice and advocate for our patients and our specialty."

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