Medicare Monthly Review, Issue 2008-03B: Medicare, Medicaid and State Children’s Health Insurance Program (SCHIP) Extension Act of 2007 (MMSEA) Changes to Independent Laboratory Billing for the Technical Component (TC) of Physician Pathology Services

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MMR-2008 03B, March 2008

MLN Matters. . .Information for Medicare Providers
(Issued by the Centers for Medicare & Medicaid Services)

Medicare, Medicaid and State Children’s Health Insurance Program (SCHIP) Extension Act of 2007 (MMSEA) Changes to Independent Laboratory Billing for the Technical Component (TC) of Physician Pathology Services

MLN Matters Number: MM5943
Related Change Request (CR) #: 5943
Related CR Release Date: February 7, 2008
Effective Date: January 1, 2008
Related CR Transmittal #: R1440CP
Implementation Date: March 7, 2008

Provider Types Affected Independent laboratories billing Medicare carriers or Medicare Administrative Contractors (A/B MAC) for services rendered to hospitalized Medicare beneficiaries

What Providers Need to Know
Qualifying independent laboratories may continue to bill Medicare directly for the TC of certain physician pathology services provided to patients as part of a covered hospital inpatient stay or outpatient hospital service, through June 30, 2008.

Background
In the final physician fee schedule regulation published in the Federal Register on November 2, 1999, the Centers for Medicare & Medicaid Services (CMS) stated it would implement a policy to pay only the hospital for the TC of physician pathology services furnished to hospital patients. Ordinarily, the provisions in the final physician fee schedule are implemented in the following year. However, new provisions established under Section 542 of the Benefits Improvement and Protection Act of 2000 (BIPA), Section 732 of the Medicare Modernization Act (MMA), and Section 104 of the Tax Relief and Health Care Act of 2006 (TRHCA) have further delayed implementation of the proposed policy change. These provisions were scheduled to expire December 31, 2007.

The Section 104 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 created a new provision to extend Section 732 of the Medicare Modernization Act (MMA) provision an additional six months. This will allows qualifying independent laboratories to continue to bill Medicare for the technical component (TC) of certain physician pathology services provided to beneficiary in a covered hospital inpatient or outpatient event, regardless of the beneficiary’s hospitalization status on the date the service was performed. Independent laboratories eligible to bill their carrier or Part A/B Medicare Administrative Contractor (Part A/B MAC) for these services may do so through June 20, 2008, regardless of the beneficiary’s hospitalization status.

Independent laboratories that qualify to bill for the TC of a physician pathology service furnished to an inpatient or outpatient of a covered hospital may continue to bill their carrier or Part A/B MAC for these services through June 30, 2008.
Effective on or after July 1, 2008, only the hospital may bill for the TC of a physician pathology service provided to a hospital inpatient or outpatient.
A covered hospital refers to a hospital that has an arrangement with an independent laboratory that was in effect as of July 22, 1999, under which the laboratory furnished the TC of physician pathology services to fee-for service Medicare beneficiaries who were patients of the hospital.
The hospital cannot bill under the Outpatient Prospective Payment System (OPPS) for the TC of physician pathology services if the laboratory that services that hospital outpatient is receiving payment from its carrier or A/B MAC under the Medicare physician fee schedule.

Additional Information
To see the official instruction (CR5943) issued to your Medicare carrier or Part A/B MAC, refer to http://www.cms.hhs.gov/Transmittals/downloads/R1440CP.pdf on the CMS Web site. If you have questions, please contact your Medicare carrier or A/B MAC at their toll-free number, which may be found at http://www.cms.hhs.gov/MLNProducts/downloads/CallCenterTollNumDirectory.zip on the CMS Web site.

Disclaimer
This article was prepared as a service to the public and is not intended to grant rights or impose obligations. This article may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations and other interpretive materials for a full and accurate statement of their contents. CPT only copyright 2007 American Medical Association.

MLN Matters. . .Information for Medicare Providers (Issued by the Centers for Medicare & Medicaid Services)

MLN Matters. . .Information for Medicare Providers
(Issued by the Centers for Medicare & Medicaid Services)