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Proposed prostate biopsy policy could cut Medicare pay

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Charles Fiegl

August 2014—How the Medicare program reimburses pathologists for prostate biopsy specimen services could change in 2015 under proposed rules for physician payment from the Centers for Medicare and Medicaid Services.

The CMS detailed its proposed plans for prostate biopsy reimbursement, in addition to other payment policy changes concerning pathologists, in the proposed 2015 Medicare physician fee schedule released July 3. The proposal includes adding three new pathology measures, sponsored by the CAP, to the Medicare Physician Quality Reporting System and the expansion of CMS’ value-based modifier program. After a 60-day comment period, the CMS will finalize the 2015 fee schedule later this year.

Once final, Medicare could reduce reimbursements to pathologists for prostate biopsy services. The CMS proposes to use one G-code, G0416, to report all prostate biopsy services, regardless of the number of specimens, in 2015. The G-code would apply to all prostate biopsy specimens, including specimens one to nine.

“CMS’ intent of this proposal is to pay pathologists less for the professional and technical component work as well as global payment for interpreting prostate biopsy specimens,”CAP Economic Affairs Committee chair Jonathan L. Myles, MD, said in a July 11 CAP webinar.

“This proposal is quite major,” Dr. Myles said. “Using one G-code for all prostate biopsy specimens irrespective of the number is certainly a big deal and we will be commenting on it.”

For 2014, Medicare’s payment policy has four G-codes for prostate biopsies in addition to billing AMA Current Procedural Terminology code 88305 when reporting specimens one through nine. G0416 applies to specimens 10–20, G0417 applies to specimens 21–40, G0418 applies to specimens 41–60, and G0419 applies to 60 specimens or greater. Under the proposed changes for 2015, the prostate G-codes and CPT code 88305 would no longer be used on billing claims to report prostate biopsies, with the exception of G0416.

“Subsequently, we have discussed prostate biopsies with stakeholders, and reviewed medical literature and Medicare claims data in considering how best to code and value prostate biopsy pathology services,” the CMS said in its rationale for change in the proposed fee schedule. “In considering these discussions and our review, we have become aware that the current coding structure may be confusing, especially since the number of specimens associated with prostate biopsies is relatively homogeneous.” The CMS cites as an example code G0416 (10–20 specimens), which it says represents the overwhelming majority of all Medicare claims submitted for the four G-codes.

“Therefore, in the interest of both establishing straightforward coding and maintaining accurate payment,” the CMS says, “we believe it would be appropriate to use only one code to report prostate biopsy pathology services. Therefore, we propose to revise the descriptor for G0416 to define the service regardless of the number of specimens, and to delete codes G0417, G0418, and G0419. We propose to revise G0416 for use to report all prostate biopsy pathology services, regardless of the number of specimens, because we believe this will eliminate the possible confusion caused by the coding while maintaining payment accuracy.”

Furthermore, the CMS said G0416 is potentially misvalued for 2015. The CMS is seeking public comment on the appropriate work relative value units, work time, and direct practice expense inputs that the Medicare agency uses to set reimbursement for the service.

Overall, the CMS’ initial impact analysis showed a one percent increase in payment in the fee schedule to pathology services. For independent laboratories, proposed changes showed a three percent increase in Medicare payment.
However, the impact figures are likely to change by the time the final rule is released, Dr. Myles says. The CMS continues to move forward with an initiative to revalue and authenticate the payment values for all physician services.

The unstable payment landscape stems from policies in the 2010 Affordable Care Act law, which empowered the CMS to review reimbursement for all high-volume physician services. So far, 1,200 codes, many from other specialties, have been reviewed under this initiative. As the CAP has worked to mitigate cuts, Dr. Myles says, pathologists have had the global payment for 28 codes revalued. The practice expenses for the technical component of 22 additional codes also have been reviewed for 2015.

In the proposed fee schedule, the CMS plans to add a total of 80 codes for physician services to its misvalued list for review. Of those codes, one pathology service is on the list: 88185, which is an add-on code used to bill the technical component of flow cytometry.

In addition, the agency is expected to publish new payment rates for services currently under review. In 2014, new G-codes were created for immunohistochemistry services. The CAP has objected to the payment policy, and the CMS is expected to respond to that objection in the final rule, Dr. Myles said.

In another example, in situ hybridization services had been placed on the potentially misvalued codes list to be revalued, and the CAP expects payment changes for this service in 2015.

The Medicare agency again discussed a 2013 proposed policy to link pathology payments on the fee schedule to Medicare rates paid to hospital outpatient departments. The CAP strongly opposes the policy, which the CMS temporarily set aside because of concern that pathologists and other stakeholders expressed. In the 2015 proposed fee schedule, the CMS referenced expanded legal authority to review payments based on reimbursement differences across sites of service. The agency is soliciting comments on using hospital cost data in valuing the practice expense payment for physician services. Any change in physician practice expense costs could have an impact on the global and technical component of pathology services if the CMS decides to move forward with such a policy.

The timeframe for the misvalued code initiative also could change. The CMS says it plans to increase transparency by setting physician payment rates only after the public has had an opportunity to comment on reimbursement changes. New payments for codes under review would be printed each year in the proposed rule, allowing those affected by the proposals the chance to oppose or concur with the new dollar amounts.

Currently, payment changes to individual codes are not announced until the final fee schedule is published each November, which then go into effect the following January. The timing is an issue as physicians must live with the decision for a year before any change can be considered, Dr. Myles says. Greater transparency would avoid such instances as when the CMS established the new G-codes for reporting immunohistochemistry services.

The CMS recognizes program gaps in measures for pathologists, and the proposed 2015 fee schedule would include three new measures for pathology developed by the CAP. Two measures are for lung cancer reporting and the other is for melanoma reporting.

The proposed fee schedule also details how the CMS plans to adjust Medicare payments based on PQRS reporting in 2015. Next year’s PQRS participation will affect 2017 payments. Failing to meet PQRS requirements in 2015 would lead to a two percent Medicare penalty in 2017. The CMS says those eligible for PQRS must successfully report on nine measures, or all the measures that apply to physician practices, to avoid the penalty.

PQRS reporting in 2015 also affects payment adjustment under the value-based modifier program. The CMS is phasing in the modifier beginning in 2015, with the VBM applying to all physicians by 2017. The modifier payment adjustments in 2017 will be based on 2015 performance.

In the proposed Medicare fee schedule, the CMS says the 2017 VBM penalty will be four percent for those groups of eligible professionals who fail to report PQRS measures successfully. However, groups with 10 or more professionals still may see their payment reduced by four percent when they successfully participate in PQRS if it’s determined they are low-quality, high-cost providers. This is in addition to the two percent PQRS penalty. The modifier, which to Medicare is a budget-neutral program, also could increase payments by up to four percent or perhaps higher for high-quality, low-cost providers. The exact bonus amount will depend on how many physicians do not participate successfully in PQRS in 2015.

In addition, there is no negative VBM adjustment in 2017 to physicians in groups with fewer than 10 eligible professionals as long as 50 percent of the group’s eligible professionals report PQRS measures successfully.

The penalties in the PQRS and VBM programs are separate, says Diana Cardona, MD, chair of the CAP Economic Affairs Measures and Performance Assessment Subcommittee. Failure to report PQRS in 2015 could amount to a negative six percent payment adjustment in 2017 for eligible pathologists subject to the penalties.

The CAP has argued that current Medicare quality initiatives do not accommodate pathologists and has proposed an alternative method to the current VBM model, Dr. Cardona says. The CMS alluded to the CAP’s VBM plan in the proposed 2015 rule. The CMS stated it is considering including or allowing hospital-based physicians to use the Medicare hospital value-based purchasing program in future years. The hospital value-based purchasing program could be a component of a physician’s VBM calculation, the agency said. The agency would propose such a change through future notice and comment rulemaking, taking into consideration public comment and relevant empirical evidence available at that time.
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Charles Fiegl is CAP manager of advocacy communications, Washington, DC.

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