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December 21, 2012 


Palmetto Medicare Issue of Payment for Some Pathology Hospital Claims     


The CSP became aware that some independent labs were getting denials on claims for certain flow cytometry interpretation codes, CPT 88187-88189, and other pathology claims for the professional component of se3rvcies for hospital patients. We believe the error occurred as part of the changes made by the Medicare carriers when the Medicare TC grandfather provision was eliminated this year. We have included below the message posted on the Palmetto website that explains the problem, All claims that were erroneously denied will be reprocessed and paid. This impacts independent lab providers as opposed to pathology groups that have physician provider numbers.


Jurisdiction 11 Part BCMS Correcting Error

in Processing of Claims by Pathologists and Independent Laboratories

for Professional Component of Certain Physician Pathology Services CMS

is taking immediate action to correct an error in processing claims

submitted by certain pathologists and independent clinical laboratories

for the professional component (PC) of physician pathology services.

Under previous law, including, most recently, Section 3006 of the

Middle Class Tax Relief and Job Creation Act of 2012, a statutory

moratorium, which expired on June 30, 2012, allowed certain

practitioners and suppliers to bill a carrier or an A/B MAC for the

technical component (TC) of physician pathology services furnished to

hospital patients. In the file furnished to contractors used to

implement the expiration of this claims payment policy, CMS erroneously

included several Health Care Procedure Code System (HCPCS) codes for

the PC of a physician pathology service in the list of TC HCPCS codes.

As a result, some claims for the PC of a physician pathology service,

when submitted by a pathologist or by an independent clinical

laboratory, are being improperly denied on the basis of the expiration

of this moratorium. In the case of an independent clinical laboratory,

the laboratory may only be paid if a physician employed by the

laboratory performed the PC of such service. As an interim measure, CMS

is instructing contractors to override the edit which is causing the

improper denials of PC of physician pathology services for claims with

a date of service (DOS) between July 1, 2012 and January 1, 2013. CMS

is also instructing each contractor to reprocess all claims billed by

pathologists or independent clinical laboratories for the PC of a

physician pathology service with a DOS on and after July 1, 2012, to

and through the date that the contractor begins to use the override for

the edit. No further action on the part of pathologists or independent

clinical laboratories will be necessary at this time.TDL 13125  



No Medicare SGR Fix in Sight


The annual ritual of trying to fix the SGR cut that impacts Medicare physician fee payments looms once again. This time there is nothing visible as of yet to solve the problem with all the focus on the "fiscal cliff". Included below is the notice from CMS on the impact on the physician fee schedule as of 1/1/13. We will keep you informed.


Attention Health Professionals:  Information Regarding the 2013 Medicare Physician Fee Schedule


The negative update of 27%under current law for the 2013 Medicare Physician Fee Schedule is scheduled to take effect on January 1, 2013.


Medicare Physician Fee Schedule claims for services rendered on or before December 31, 2012, are unaffected by the 2013 payment cut and will be processed and paid under normal procedures and time frames.  


The Administration is disappointed that Congress has failed to pass a solution to eliminate the sustainable growth rate (SGR) formula-driven cuts, and has put payments for health care for Medicare beneficiaries at risk. We continue to urge Congress to take action to ensure these cuts do not take effect. Given the current progress with the legislation, CMS must take steps to implement the negative update.  


Under current law, clean electronic claims are not paid sooner than 14 calendar days (29 days for paper claims) after the date of receipt. CMS will notify you on or before January 11, 2013, with more information about the status of Congressional action to avert the negative update and next steps.




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