Skip to main content
Premium Trial:

Request an Annual Quote

CAP Lobbying for Relief on LDTs, Medicare Cuts

NEW YORK – Leaders from the College of American Pathologists said this week they are pushing the US Food and Drug Administration for answers about the proposal to increase agency oversight of laboratory-developed tests while they also lobby Congress for legislative solutions to an expected cut in Medicare payments. However, organization leaders expressed skepticism that they will get immediate relief through a deeply divided House of Representatives.

During CAP's annual meeting this year in Chicago, organization leaders also said they have been in a whack-a-mole game of batting down insurers' efforts to cut payments to pathologists, often accomplished by making the reimbursement process more cumbersome.

Donald Karcher, who was elected CAP president during the meeting, said in a presentation and an interview that the organization has asked the FDA to double to 120 days the comment period for its recently published draft rule that would amend federal regulations to place LDTs under similar oversight to other in vitro diagnostics. The standard 60-day comment period is "absolutely inadequate for something that is so complex," he said, especially when his organization is unclear how the agency plans to apply provisions related to risk-based stratification of those tests and which tests may be exempt from agency oversight.

"We're nowhere close to having our arms around this, even vaguely close to having our arms fully around it," Karcher said.

Most pathology labs have LDTs on their menu, and immunohistochemical LDTs are common, if not the most common, test in those labs, Karcher said. While the draft rule states that immunohistochemistry tests that involve no automated preparation or interpretation could be exempt from oversight, he said it's unclear to CAP whether that would require manual staining, which happens in few laboratories. The organization is going through the proposal line-by-line to find more questions for the agency.

CAP is also bracing for a predicted 3 percent cut in Medicare reimbursement to pathologists through the proposed 2024 changes in the physician fee schedule. CMS has proposed adopting an add-on code that would boost payments for the evaluation and management of complex patients and, because of a budget neutrality requirement, that boost in pay to primary care physicians will reduce payments to specialists, including pathologists. The finalized regulations are anticipated in November.

"It's a huge cut for all pathology groups and all labs, I can assure you," he said.

CAP supports legislation that would add an inflationary adjustment to the physician fee schedule, Karcher said.

Coupled with the hardships of inflation, Karcher said the cuts could reduce access to surgeries that require pathology in rural areas and low-income urban areas as well as prevent other labs from filling openings for pathologists. He practices in at George Washington University in Washington, D.C., and said he knows of a small pathology practice in Baltimore that is hanging on by its fingernails. If that practice goes under, nearby surgeons could have difficulty finding a pathologist to perform a frozen section and patients could be forced to travel further for care.

Joe Saad, member of the CAP Board of Governors and chair of the Council on Government and Professional Affairs, said Monday at the meeting that CAP has scheduled talks with committee leaders in both houses of Congress.  And the organization is advocating directly to the Centers for Medicare and Medicaid Services to encourage it to update the data used to calculate the physician fee schedule.

But Karcher sees dim prospects for relief through Congress, which is currently occupied with the uncertainties of a House speakership vacancy following the ouster of Rep. Kevin McCarthy (R-Calif.) this month and a debt limit fight that has been postponed through a 45-day continuing resolution. Karcher noted that the legislative fixes for the cuts to Medicare reimbursements would require committing to billions of dollars in new healthcare spending.

In addition, CAP is backing a bill before Congress, the Resident Physician Shortage Reduction Act of 2023, that would add 2,000 Medicare-supported graduate medical education positions per year for seven years as well as supporting J-1 visa reforms to that would remove the requirement that recipients return to their home country for two years at the end of their medical education or training.

CAP has also fought a revolving door of battles with insurers that want to reduce payments for pathology services, Karcher said. Anthem announced cuts in pathology payments in many jurisdictions across the country; payors including Cigna and Aetna have proposed or enacted policies to end payments to pathologists for overseeing the quality of tests in their labs; and UnitedHealthcare rescinded a policy that labs would need to develop additional unique billing codes for molecular LDTs to clarify which tests were being performed. He also noted that Highmark recently requested that in-network labs provide additional validation for certain germline and somatic cancer tests beyond what's required for CLIA certification and CAP accreditation.

"We worry that the motives are always financial," he said.

Karcher said CAP is pushing back on these issues "with all guns blazing."

"We're putting a lot of resources to bear on private payor issues because they do impact all of our practices in very meaningful ways," he said.