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November 19, 2012 


Medicare 2013 Fee Schedule Makes Steep Reduction to 88305 


The proposed Medicare fee schedule for 2013 was released on November 5th. The fee schedule takes aim at specialty providers and high volume codes. The bad news is a proposed reduction to the technical component of CPT 88305 of 52 %.  Other codes in the 88300 series also took some reductions in the technical component, but not of similar magnitude , while some others like 88307 and 88309 actually had increases in the TC for 2013. Though the fee schedule is technically not final, i.e. there is a comment period, it is not likely that there will be any changes.


The Professional Component of 88305 will increase in 2013 by 2%. The TC cut impacts pathologist with freestanding or outpatient labs, while hospital based pathologists only billing for the PC of 88305 will not feel the brunt of this reduction. The 2013 proposal also contains the SGR cut of 26.5% for all physician services that needs to be averted through a Congressional fix.


The CAP worked hard to stop or mitigate the size of the reduction to the TC of 88305. In the end only some mitigation of the size of the reduction was accomplished. The CAP did advocate that the PC of 88305 did not need to re-evaluated since it had been reviewed in 2010. CMS did agree and there was no re-evaluation of the PC. We know that the CAP will continue their advocacy efforts on other elements of the proposal and the CSP will support them in this effort.


Medi-Cal Change to Clinical Lab Reimbusement Methodolgy


We previously informed you that a last minute addition to the 2012-13 state budget called for a reassessment of the current Medi-Cal reimbursement rates for laboratory services. The budget provisions calls for an immediate 10% reduction in reimbursement rates and the use of a stakeholder process to gather data from current lab providers on payment rates from other payers. The CSP has participated in two stakeholder meetings to date. The CSP submitted comments this week over the DHCS proposed elements for provider data submission that was currently released. The current proposal is that lab providers would be required to submit payment data by 1/31/13. It seems likely that this date will be pushed back. The CSP's major comments on the DHCS proposal were as follows;


  • The proposal would require that all providers who billed for an anatomic or clinical pathology 80000 series code to report what every payer reimbursed them for that specific code. It would apply to physician office labs, hospital outpatient labs etc. It would impose an unreasonable burden on providers and generate a mountain of data that DHCS would have to review.
  • The breadth of application to every CPT/HCPCS code would require calculation of actual payment amounts to take into account individual patient coinsurance/deductibles, disallowances based upon frequency,  etc.
  • Since submission would be required for hospital based pathologists, DHCS would need to recognize modifiers, such as -26, in evaluating payment amounts which reflect PC, TC and global payments.
  • Data elements currently require submission of NPI numbers of the entity drawing/gathering the specimen, which presents special problem for AP and where the biopsy specimen was removed.


We believe the DHCS proposal requires substantial amendments in order to be workable for providers and  truly useful for DHCS. We will keep you informed on this project and the likely impact on laboratory providers.




CSP Annual Convention

November 27 - December 1, 2012

Hyatt Regency Embarcadero

San Francisco, CA


Click here to REGISTER. 


Click here for full attendee brochure. 



California Society of Pathologists
One Capitol Mall Suite 320
Sacramento, CA 95814 
Tel : 916-446-6001
Fax :  916-444-7462