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Proposed 2023 MedicarePolicy and PaymentChanges for PathologistsJonathan L. Myles, MD, FCAPW. Stephen Black-Schaffer, MD, FCAPDiana M. Cardona, MD, FCAPPamela K. Wright, Senior Director of CAP Economic & Regulatory Affairs,AdvocacyAugust 8, 2022 College of American Pathologists.

WelcomeJonathan L. Myles, MD, FCAP Chair, CAP Council on Government andProfessional Affairs Vice-Chair of the CAP Council on ScientificAffairs College of American Pathologists.2

WelcomeW. Stephen Black-Schaffer, MD, FCAP Chair, CAP Economic Affairs Committee College of American Pathologists.3

WelcomeDiana M. Cardona, MD, FCAP Chair of the Quality and Clinical DataRegistry Committee College of American Pathologists.4

Agenda CAP Policy and Advocacy Proposed 2023 Fee Schedule and Reimbursement Policy Overview Pathology Codes Impact and Outlook for 2023 Proposed 2023 Quality Payment Program Policy Overview Take Action Questions College of American Pathologists.5

Proposed 2023 Medicare Physician Fee Scheduleand Quality Payment Program Regulations Proposed 2023 Medicare Physician Fee Schedule and QualityPayment Program regulations were released on July 7o CAP members received a Special Advocacy Update with initial analysis of thisregulation CAP will continue to engage with the Centers for Medicare & MedicaidServices (CMS) Final regulations expected Fall of 2023 College of American Pathologists.6

CAP Policy and Advocacy College of American Pathologists. College of American Pathologists.7

CAP Advocacy Priorities Protect the value of pathology services Mobilize pathologists for political action Ensure pathologists can participate in new payment models Strengthen the profession with advocacy in states Conduct socioeconomic research College of American Pathologists.8

A never-ending process . . .Since 2006, well over half of all pathologyCPT codes have been targeted forrevaluation by the CMS. College of American Pathologists. College of American Pathologists.9

Restore Rank Order for Histotechnologists andLaboratory Technicians In an advocacy win for the payment of pathology technical componentservices, the CMS will restore the proper rank order of the clinical laborrates for histotechnologists and laboratory technicians. In the proposed 2023 regulation, the CMS announced changes to thehistotechnologist’s clinical labor rate, which would be priced more than16% higher than 2022. These rates are being phased in over 4 years. 2023 will be the second yearof the phase in. College of American Pathologists.10

Proposed Pathology Payment Changes for 2023 The conversion factor proposed for the 2023 fee schedule paymentformula is decreased by 4.4% relative to that of the 2022 fee schedule This is due to expiration of the 3% increase to Medicare fee schedulepayments for 2022 required by the Protecting Medicare and AmericanFarmers from Sequester Cuts Act, and the required budget neutralityadjustment required by changes in relative value units As a result of these changes, the CAP estimates:o -3.4% overall impact to pathology Medicare paymentso -3.5% overall impact to independent laboratory Medicare payments Review the proposed pathology services changes in our proposed 2023Medicare Physician Fee Schedule Impact Table. College of American Pathologists.11

Top Pathology Services – Proposed ReimbursementsCPT CodeModifier Short Descriptor2022 PaymentProposed 2023PaymentPercent Change 70.79-2%88305globalTissue exam by pathologist 71.988830526Tissue exam by pathologist 37.37 36.05-4%88305TCTissue exam by pathologist 34.61 34.730%88312globalSpecial stains group1 114.55 111.14-3%8831226Special stains group1 26.30 25.47-3%88312TCSpecial stains group1 88.25 85.67-3%88313globalSpecial stains group 2 82.36 81.04-2%8831326Special stains group 2 12.11 11.58-4%88313TCSpecial stains group 2 70.25 69.46-1%88314globalHistochemical stains add-on 100.36 89.97-10%8831426Histochemical stains add-on 21.11 19.85-6%88314TCHistochemical stains add-on 79.25 70.12-12%88341globalImmunohisto antb addl slide 102.43 85.01-5%8834126Immunohisto antb addl slide 28.03 26.79-4%88341TCImmunohisto antb addl slide 61.60 58.55-5%88342globalImmunohisto antb 1st stain 89.63 99.23-3%8834226Immunohisto antb 1st stain 34.61 33.41-3%Immunohisto antb 1st stain 67.83 65.82 College of American Pathologists.88342TC-3%8 August 202212

Largest Changes in Pathology – Proposed 2023CPT 1858818488314883748831488374 College of American Pathologists.TCTCTCTCShort DescriptorCytp fna eval ea addlCell marker studyForensic cytopathologyCell marker studyCytopath smear other sourceNerve teasing preparationsFlowcytometry/tc add-onFlowcytometry/ tc 1 markerHistochemical stains add-onM/phmtrc alys ishquant/semiqHistochemical stains add-onM/phmtrc alys ishquant/semiqProposed 20232022 PaymentPayment 7.27 8.27 110.74 123.05 13.50 14.55 149.15 160.43 76.13 80.71 113.16 119.74 22.15 69.21 79.25 288.62 100.36 331.87 18.19 61.19 70.12 258.67 89.97 10%-10%13

CAP Win: Digital Pathology Codes for 2023 College of American Pathologists. College of American Pathologists.14

Digital Pathology CodesOn July 1, the American Medical Association CPTEditorial Panel released 13 new digital pathologyadd-on codes for 2023 that the CAP successfullyadvocated for inclusion.These codes are to report additional clinical staffwork and service requirements associated withdigitizing glass microscope slides for primarydiagnosis. College of American Pathologists.15

Digital Pathology Digitization ProceduresCPTCode Long Descriptor 0751T 0752T 0753T 0754T 0755T 0756T 0757TDigitization of glass microscope slides for level II, surgical pathology, gross and microscopic examination (List separately in addition to code forprimary procedure) (Use 0751T in conjunction with 88302) Digitization of glass microscope slides for level III, surgical pathology, gross and microscopic examination (List separately in addition to code forprimary procedure) (Use 0752T in conjunction with 88304) Digitization of glass microscope slides for level IV, surgical pathology, gross and microscopic examination (List separately in addition to code forprimary procedure) (Use 0753T in conjunction with 88305) Digitization of glass microscope slides for level V, surgical pathology, gross and microscopic examination (List separately in addition to code forprimary procedure) (Use 0754T in conjunction with 88307) Digitization of glass microscope slides for level VI, surgical pathology, gross and microscopic examination (List separately in addition to code forprimary procedure) (Use 0755T in conjunction with 88309) Digitization of glass microscope slides for special stain, including interpretation and report, group I, for microorganisms (eg, acid fast,methenamine silver) (List separately in addition to code for primary procedure) (Use 0756T in conjunction with 88312) Digitization of glass microscope slides for special stain, including interpretation and report, group II, all other (eg, iron, trichrome), except stain formicroorganisms, stains for enzyme constituents, or immunocytochemistry and immunohistochemistry (List separately in addition to code forprimary procedure) (Use 0757T in conjunction with 88313) College of American Pathologists.16

Digital Pathology Digitization ProceduresCPTCode Long Descriptor 0758T 0759T 0760T 0761T 0762T 0763TDigitization of glass microscope slides for special stain, including interpretation and report, histochemical stain on frozen tissue block (Listseparately in addition to code for primary procedure) (Use 0758T in conjunction with 88314) Digitization of glass microscope slides for special stain, including interpretation and report, group III, for enzyme constituents (List separately inaddition to code for primary procedure) (Use 0759T in conjunction with 88319) Digitization of glass microscope slides for immunohistochemistry or immunocytochemistry, per specimen, initial single antibody stain procedure(List separately in addition to code for primary procedure) (Use 0760T in conjunction with 88342) Digitization of glass microscope slides for immunohistochemistry or immunocytochemistry, per specimen, each additional single antibody stainprocedure (List separately in addition to code for primary procedure) (Use 0761T in conjunction with 88341) Digitization of glass microscope slides for immunohistochemistry or immunocytochemistry, per specimen, each multiplex antibody stainprocedure (List separately in addition to code for primary procedure) (Use 0762T in conjunction with 88344) Digitization of glass microscope slides for morphometric analysis, tumor immunohistochemistry (eg, Her-2/neu, estrogen receptor/progesteronereceptor), quantitative or semiquantitative, per specimen, each single antibody stain procedure, manual (List separately in addition to code forprimary procedure) (Use 0763T in conjunction with 88360) College of American Pathologists.17

Digital Pathology CPT Codes 0754T88302883048830588307883098831288313 0751T 0752T 0753T 0754T 0755T 0756T 0757T College of American Pathologists.18

Digital Pathology CPT Codes 0754T883148831988342883418834488360 0758T 0759T 0760T 0761T 0762T 0763T College of American Pathologists.19

Digital Pathology Digitization ProceduresDo not report the new Category III codes: Solely for archival purposes (eg, after the Category I service has alreadybeen performed and reported) Solely for educational purposes (eg, when services are not used forindividual patient reporting) Solely for developing a database for training or validation of AI algorithms Solely for clinical conference presentations (eg, tumor boardinterdisciplinary conferences) College of American Pathologists.20

Digital Pathology Digitization Procedures July 1, 2022: Released on the AMA website January 1, 2023: Effective Dateo July 2022 - December 2022: Preparation for January 2023 implementation College of American Pathologists.21

Proposed 2023 Medicare Quality PaymentProgram Requirements College of American Pathologists. College of American Pathologists.22

Quality Payment Program PathwaysTwo pathways/tracks have been offered under the QPP: College of American Pathologists.23

Year 7 MIPS ImplementationPerformance Year 2023:The CMS proposed tokeep the PerformanceThreshold at 75 pointsPayment YearAs per the MACRA Statute, 2022 is the last year the Exceptional PerformanceBonus is available. College of American Pathologists.24

Proposed 2023 MIPS Performance Year Quality Measures: 85% of Final Score Improvement Activities: 15% of Final Score Promoting Interoperability: Non-patient facing pathologists andgroups automatically reweightedReweighting Policy for SmallPractices ( 15 pathologists):Quality and IA categories each scoredat 50% if Promoting Interoperabilityand Cost are reweighted to 0 Cost: Non-patient facing pathologists and groups are almost neverattributed Cost scores18.76-74.99 points:Negative adjustmentbetween -9% and 0%0-18.75 points:Negative adjustmentof -9% College of American Pathologists.Performance Threshold: 75 points neutral payment adjustment75.01-100 points:Positive adjustmentbetween 0% and 9%

MIPS Performance Threshold Is Harder to Achieve CMS proposes to keep the performance threshold at 75 points in 2023 The 3-point floor for quality measures will be removedo Benchmarked measures are worth 1 - 10 points; however, if topped out worth 1 - 7 points.Pathologists using topped out QPP measures must achieve 100% to get 7 QPP 24999.8%3.0QPP 24999.8%1.0QPP 25098.0%3.0QPP 25098.0%1.0QPP 395100%7.0QPP 395100%7.0QPP 39699.2%3.0QPP 39699.2%1.0QPP 39799.5%3.5QPP 39799.5%2.5QPP 440100%7.0QPP 440100%7.0Score: 26.5 Maximum Quality score with QPP measures: 42 out of 60Score: 19.5 Maximum Quality score with QPP and QCDR measures in the Pathologists Quality Registry: 54 out of 60 College of American Pathologists.26

QPP Proposed Rule: What is Staying the SameCriteriaCY 2022 and CY 2023Performance Threshold75 PointsData Completeness ThresholdMinimum 70% all-payer data completenessPerformance CategoryReweightingLarge Practices: 85% Quality/15% IASmall Practices: 50% Quality/50% IAMeasure Bonus PointsNo bonus points for additional high prioritymeasures6 bonus points for small practicesTraditional MIPS Sunset DateProposed end date for traditional MIPS wasremoved College of American Pathologists.27

2023 Proposed Pathology Quality Measures Set2022Measure ID Title2023Measure ID TitleQPP 249Barrett’s EsophagusQPP 250Radical ProstateReportingQPP 249Barrett’s EsophagusQPP 250Radical ProstateReportingLung Cancer Reporting(Biopsy/Cytology)Lung Cancer Reporting(Resections)Melanoma ReportingQPP 395Lung Cancer Reporting(Biopsy/Cytology)QPP 396Lung Cancer Reporting(Resections)QPP 397Melanoma ReportingQPP 440Biopsy Turnaround Time:Squamous and Basal CellCancer and Melanoma*Biopsy TurnaroundTime: Squamous andBasal Cell Cancer andMelanoma*TBDMMR/MSI for CheckpointInhibitor TherapyTBDSocial Drivers of Health*QPP 395QPP 396QPP 397QPP 440 College of American Pathologists.28* measure NOT owned by the CAP

The Pathologists Quality Registry Helps OurMembers with MIPSEnrollment is “high-touch” customer service experience from the CAPQuality Measures:1. Manual data entryo Via web portalo Via excel file upload2. Automated data entry with billing and/or LISImprovement Activities (IA):o The registry makes it easy to understand and choose from a subset of IA mostpathologists are already doingo Most billing companies cannot submit IAo Even if you are facility-based, you still need to submit IAEmail us at [email protected] College of American Pathologists.29

New Participation Pathway: MIPS Value Pathways (MVPs)CMS wants to evolve current MIPS frameworkImplementation starting 2023 MIPS Performance Year College of American Pathologists.30

Proposed 2020 MIPS Value Pathways Seven proposed in 2022, finalized for implementation in 2023o Advancing Care for Heart Diseaseo Optimizing Chronic Disease Managemento Advancing Rheumatology Patient Careo Improving Care for Lower Extremity Joint Repairo Adopting Best Practices and Promoting Patient Safety within Emergency Medicineo Patient Safety and Support of Positive Experiences with Anesthesiao Coordinating Stroke Care to Promote Prevention and Cultivate Positive Outcomes Five new MVPs proposed for 2023o Advancing Cancer Careo Optimal Care for Kidney Healtho Optimal Care for Patients with Episodic Neurological Conditionso Supportive Care for Neurodegenerative Conditionso Promoting Wellness College of American Pathologists.31

Alternative Payment Models in 2023 Few programmatic changes in Advanced APMso Proposal to make the 8% minimum nominal risk permanent The 5% bonus for APM participation ends in CY2022/PY2024o In CY2024/PY2026 and beyond, participants in APMs will see an increased conversion factor compared to MIPSparticipants: 0.75% compared to 0.25%o In CY2023/PY2025, no incentive to participate in APMs CMS's ultimate goal is to transition health care system over to APMs. Given the conclusion of the incentives, itis uncertain how rapidly this will happen or whether movement into APMs could stagnate College of American Pathologists.32

Before we take questions College of American Pathologists. College of American Pathologists.33

Stay Informed Through the CAP Follow CAP on social mediaooTwitter @CAPDCAdvocacyFacebook.com/capathologists Visit CAP.org advocacy Read Advocacy Update Join PathNET, the CAP’s grassroots advocacy network College of American Pathologists.34

Questions College of American Pathologists.35

College of American Pathologists.

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