Pathology/Lab Coding Alert

Watch for SRG relief by year’s end.

The word is in -- expect less pay for your lab in 2013 whether your procedures cluster on the Clinical Laboratory Fee Schedule (CLFS) or the Medicare Physician Fee Schedule (PFS).

Here’s the low-down on what you can expect based on the final PFS published in the Nov. 16, 2012 Federal Register, and the final CLFS 2013 payment decision posted in CMS’ Transmittal R2612CP.

Pathologists Play Second Fiddle to Primary Care

To offset a pay increase to some physicians under the primary care initiative, CMS is decreasing pay for all non-primary care physicians, including pathologists. Expect a 1 percent reduction for pathology, according to CMS.

Here’s why: CMS implements a 7 percent pay increase for family practitioners in 2013, and between 3 and 5 percent increases for other primary-care practitioners. "Helping primary care doctors will help improve patient care and lower health care costs long term," said CMS Acting Administrator, Marilyn B. Tavenner in a statement about the PFS.

Don’t forget that you’re already facing a 1 percent reduction for pathology in 2013 as the final year of the four-year practice-expense (PE) transition. That totals two percent down for pathology.

There’s more: The PFS shows a net reduction in Relative Value Units (RVUs) for pathology services of about 4 percent, much of it due to Technical Component (TC) revaluation and RVU changes to high-volume codes based on Affordable Care Act direction. For instance, you’ll see a - 33.4 percent pay change for 88305 (Level IV - Surgical pathology, gross and microscopic examination) (global fee, non-facility).

"Because 88305 is one of the highest-volume procedures for us and for many pathology practices, this payment change will have a significant impact on earnings in 2013," says R.M. Stainton Jr., MD, president of Doctors’ Anatomic Pathology Services in Jonesboro, Ark.

Final bad news: If congress doesn’t act to halt changes due to the Sustainable Growth Rate (SGR) formula, you’ll also see a significant across the board cut in PFS payment under the final rule’s stated 26.5 percent conversion factor reduction.

"The President’s budget calls for an aversion of the cut and a permanent fix," said Kathy Bryant, deputy director of the department of physician services at CMS at the AMA’s annual CPT^® and RBRVS Symposium in Chicago.

CLFS a Downer, Too

Look for a 4.95 percent payment cut in 2013 for tests paid on the CLFS, based on current law. The following adjustments show you how it adds up:

2 percent cut passed by Congress to help pay for 2012 PFS fix

2 percent reduction in lab fee schedule payments over 10 years as part of the 2011 deficit reduction deal

Net 0.95 percent cut based on the health care reform law fee schedule update formula that includes a 1.75 percent cut each year from 2011 through 2015 and a positive consumer price index adjustment (1.7 percent) minus a productivity adjustment (currently 0.9 percent).

Wait for molecular pathology: Although CMS determined that the agency will pay for the CPT^® 2013 molecular pathology codes (81200-81048, … molecular pathology procedures …) on the CLFS, the agency will use gap-fill payment methodology. That means you can expect your Medicare contractors to price the codes this year while CMS gathers information to establish a national payment rate for 2014.

Editor’s note: Congress passed a bill on New Year’s Day that halts the 26.5 percent conversion factor reduction on the PFS for one year. The bill also puts off the 2 percent cut to the CLFS until March