Both CMS and MACs Remain Silent on Molecular Pathology Code Pricing

The deadline for Medicare Contractors to submit their fee schedules to CMS came and went with no updates provided by any of the contractors on what was ultimately submitted. Palmetto, which is driving nationwide pricing for the MoPath codes, had committed to a transparent process in the pricing and in some cases re-pricing of these new codes as a large number of labs provided a steady stream of information on the methodologies and costs related to these tests.  Requests for feedback last week on the gapfill analysis being performed prior to this weekend’s submission were not answered.   Industry groups like ACLA and CCLA have pressed for more transparency but have been unable to make any real headway with the MACs or CMS.

The lack of insight that contractors have provided into their gapfilling procedures have left many to speculate that there simply was no consistent methodology applied during this exercise.  Congress requires CMS lab rate setting to be rational.  Section 1833(h)(8)(B)(iv) of the Social Security Act instructs that “after posting the new tests, and taking public comment, CMS shall post its proposed determinations for the “appropriate basis for establishing a payment amount” together with an explanation of the reasons for each such determination, and the data on which the determinations are based.” Then, (B)(v) provides additional instruction to “Make the “final” determinations of the payment    amounts available, again including the rationale and the data on which the determinations are based.  CMS further states, “In the interests of transparency, we will instruct carriers or MACs to provide a rationale for their final carrier specific amounts, which we will post on our web site.”  (Nov 27 2007, 72 FR 66279).

Accordingly, the statute requires a rationale to be posted by CMS, and, even when CMS delegates the gap fill process to contractors, the rationale still applies as it is found in statute.  This requirement for transparency is needed at the contractor level to allow advice and comment by stakeholders. With labs, manufacturers and industry advocates unable to replicate any of the price points established, the lack of an obvious thoughtful process is likely to create more stonewalling until CMS or the contractors are forced to begin communicating more openly as required by section 1833(h)(B)(iv) of the Social Security Act.  As labs continue to struggle with inconsistent contractor feedback and CMS remains mute on the issue of dramatically reduced fee schedules, unpublished pricing, and even software glitches that prevent claims from adjudicating, the threshold for how long molecular diagnostic providers can survive with severely reduced cash flow is being callously tested.

XiFin is tracking published MAC allowed amounts, see the list here