Health Information Management

Q/A: Billing the technical component of pathology services

APCs Insider, June 1, 2012

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Q: Our chargemaster coordinator wants to add line items to our chargemaster for pathology services. We send all of our pathology out to an independent laboratory that bills all payers. He is adamant that we have to start billing the technical portion, but we never have. Our lab director is resistant to add these line items for the same reason. Thanks for any insight that you can offer.

A: This is a situation that has been evolving over the past few years. Pathologists and Independent laboratories have been allowed to bill both the professional and technical components for pathology services they provide. However, under the MS-DRG (IPPS) payment system, the MS-DRG payment to the hospital for inpatient services includes all technical services provided. Therefore, based under the IPPS rules, the technical component should be included in the MS-DRG payment.
Discontinuing this allowance has been discussed for several years but Congress has always stepped in at the last minute to extend it for another 6 -12 months. Based on the latest information available through CMS and the MACs websites, Congress will not step in again. Because CMS is looking to cut costs, this is an easy way to accomplish this from its perspective.
While Congress could step in at the last minute and extend this moratorium as is has in the past, it seems to be very unlikely based on the information from CMS and the MACs:
Under previous law, including, most recently, Section 3006 of the Middle Class Tax Relief and Job Creation Act of 2012, a statutory moratorium allowed certain practitioners and suppliers (such as pathologists and Independent Laboratories) meeting specific criteria to bill a carrier or an A/B MAC for the Technical Component (TC) of physician pathology services furnished to hospital patients. This moratorium expires on June 30, 2012. Therefore, pathologists and independent laboratories that provide the TC of physician pathology services furnished to hospital patients may no longer bill for and receive Medicare payment for these services, effective for claims with dates of service on and after July 1, 2012.
For background and policy information regarding payment to pathologists and independent laboratories for the technical compondent of physician pathology services furnished to hospital patients, refer to MLN Matters® Article MM5343 andMLN Matters® Article MM5347.
Your chargemaster coordinator is wise to look at this now in preparation of this loop hole being closed. Most hospital chargemasters don't have line items in place for these services unless they have provided the service from their own lab (the pathologist comes to them rather than the specimen going to the pathologist at another lab). It would be wise to begin the discussions concerning addition of line items.
Editor’s note: Andrea Clark, RHIA, CCS, CPCH, chairman, CEO, and founder of Health Revenue Assurance Associates, Inc., in Plantation, FL, answered this question.

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