The bipartisan measure––H.R. 2534, the Physician Pathology Services Continuity Act of 2009––was introduced by Rep. John Tanner (D-Tenn.) with cosponsor Rep. Geoff Davis (R-Ky.) and referred to the Energy and Commerce and Ways and Means committees.

A companion bill is pending in the Senate––S. 947, introduced by Blanche Lincoln (D-Ark.) with cosponsor Pat Roberts (R-Kans.) and referred to the Finance committee.

The “grandfather” protection affects hospital-lab arrangements in effect as of July 22, 1999, the date when Medicare policymakers first proposed to end the pathology TC billings. Since then, Medicare officials have repeatedly sought to eliminate these billings, arguing that the TC is reimbursed as part of the Part A inpatient payment, and labs should seek TC payment from the hospital, not Part B. However, Congress has stepped in repeatedly to block the Centers for Medicare and Medicaid Services (CMS) from going forward.

The “grandfather” protection applies to the hospital, not the lab, CMS says. Hospitals may switch labs without losing the protection; however, independent labs cannot switch hospitals and still be protected. CMS also has defined the TC of pathology services to include not only anatomic services, but also cytopathology and surgical pathology.