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Medical Coding News Archives

Technical Component of Physician Pathology Services

June 20, 2013:

Regina Magnani, RHIT, Clinical/Technical Editor

As of June 25, 2013, retroactive to July 1, 2012, hospitals must bill the technical component (TC) of physician pathology services for inpatients or outpatients when the TC service is bundled into the facility payment, as it is for hospitals paid under the inpatient and outpatient prospective systems.

More than a decade ago, Medicare intended to prohibit, as of January 1, 2001, independent laboratories from billing and receiving payment for the technical component (TC) of pathology services rendered to hospital inpatients or outpatients. However, numerous regulatory updates and Centers for Medicare and Medicaid Services (CMS) administrative decisions extended a moratorium on this prohibition until 2008. Then the Medicare Improvements for Patients and Providers Act (MIPPA) of 2008 once again extended the implementation date for this provision until June 30, 2012.

Hospitals that had an arrangement with an independent laboratory before July 22, 1999, that allowed the laboratory to bill the TC of physician pathology services for Medicare fee-for-service beneficiaries were allowed to continue under this arrangement until July 1, 2012.

When the service is performed in an institutional setting, such as an ambulatory surgery center, but not bundled into the facility payment, payment is made under the physician fee schedule for TC services. Payment may be made under the physician fee schedule for the TC of physician pathology services furnished by an independent laboratory, or a hospital acting as an independent laboratory, to non-hospital patients. The physician fee schedule identifies physician laboratory or physician pathology services that have a TC component.


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