Is Legality an Issue with Pathology Billing Services?

April 01, 2016

Is Legality an Issue with Pathology Billing Services

With malpractice costs reaching astronomical heights and reimbursements being at the lowest levels possible, clinicians are now contemplating direct billing at comfortable rates, for which they have great support from the laboratories. However, the truth of the matter is that most care organizations may not match the rates they pay pathologists with the rates they are willing to pay laboratories. Most pathology billing companies realize that it is only a licensed physician who has legal clearance to decide on behalf of the patient under existing state laws. As the choice of a laboratory or pathology service provider rests with the medical fraternity the payor has no say.

Since it is the pathologists who have the education, training and qualifications to offer such medical services they have the right to make medical judgements that come under the practice of medicine. Moreover, pathology billing companies should also understand that according to state and federal certification standards, which includes the Clinical Laboratory Improvement Amendments of 1988, stipulate that laboratories need to have contracts only with pathologists for all professional component services.

Pathology Medicare clearly stipulates that Medicare beneficiaries seeking reimbursement for pathology services have to go through Medicare Part A DRG for all payments. It is futile to go through Medicare Part B where payments are made directly to pathologists, whereas through Medicare Part A the payment is through hospitals. Moreover, the Office of the Inspector General (OIG) warns that any hospital that does not pay a pathologist would be violating the anti-kickback law of Medicare and Medicaid as well.

It makes sense for Pathology medical billing companies to note that hospitals that refuse to pay pathologists are liable to be implicated by the Medicare and Medicaid anti-kickback law. To make matter worse, some hospitals insist that the pathologists remunerate them for allowing the pathologists to provide services to the hospitals patients (both inpatients and outpatients) .This again, according to the OIG, is liable for action under the anti-kickback law. The OIG goes on to clarify that pathologists may not receive payment for Part A services rendered, in lieu of being allowed to offer services and bill under Part B services at that particular hospital. Hospitals that refuse Part A payments to pathologists are liable for civil as well as criminal penalties due to violation of the anti-kickback law.

There is also a distinct line drawn between technical services (cost of equipment, salaries of lab staff, and other overheads) and medical services rendered by pathologists. Pathology billing companies take note that payment for these technical services may be covered by the amounts private payors or patients make to the hospitals. Pathologists, on the other hand, are entitled to bill private non-Medicare and non-Medicaid patients and payors directly. However, there can never be any double billing where pathologists bill the hospitals, and the private patients not covered under Medicare or Medicaid.

Pathology medical billing firms should know that the College of American Pathologists and the American Pathology Foundation consider it appropriate for them to bill payors or patients for clinical pathology services rendered for the professional components. Pathologists are entitled to bill for the professional components of clinical pathology services, for which they can use the -26 modifier. This modifier is associated with CPT codes 80049-87999, and no written report or professional interpretation is required for having extended a professional component service.


Category : Best Billing and Coding Practices