On October 10, ASCP submitted its comment letter on the 2007 Physician Fee Schedule (PFS) and urged the Centers for Medicare & Medicaid Services (CMS) to adopt strict regulatory provisions to prevent abusive billing practices by “pod” or “condo” laboratories. These laboratories participate in “contractual joint ventures,” enabling clinicians and other entities to capture the revenues resulting from the referral of pathology services.

ASCP urged CMS to clarify Medicare regulations that reassignment of benefits rules pertaining to contractual arrangements are subject to program integrity safeguards relating to the right of payment for diagnostic tests. ASCP also advocated that the regulations for payment of the technical component be amended so that 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 physician or other supplier's net charge to the billing physician or medical group, the billing physician's or medical group's actual charge, or the fee schedule amount for the service that would be allowed if the physician or other supplier billed directly. ASCP hopes these changes to the Medicare rules would minimize the ability of pod laboratories to unfairly compete for anatomic pathology services.

ASCP also urged the Administration to work with Congress to fix the flawed sustainable growth rate (SGR) formula, which has resulted in negative annual updates in the Physician Fee Schedule (PFS). ASCP noted that “the negative update, combined with the 5 percent reduction in pathologist practice expenses means pathologists could see more than a 10 percent reduction in Medicare reimbursement rates in 2007, assuming Congress does not act to stop the negative 5.1% SGR update.”

ASCP supported CMS’s proposal to adjust the direct practice expense inputs for flow cytometry CPT codes 88184 and 88185, per supplemental data submitted by the American Clinical Laboratory Association. CMS had planned to make these changes previously but held off after other medical specialty societies opposed the Agency’s supplemental survey methodology. ASCP’s letter was in response to CMS’ proposed physician fee schedule rule, which was published in the Federal Register on August 22nd. ASCP’s comments also addressed the date of service, independent laboratory billing, and clinical laboratory diagnostic tests.