CMS Clarifies TC-Bundling Dilemma for ASCs

The Centers for Medicare and Medicaid Services (CMS) has clarified a long-standing dilemma faced by laboratories and pathologists that provide services to patients of freestanding ambulatory surgery centers (ASCs). In the past, most Part B Medicare administrative contractors would deny the technical component (TC) if the claim displayed place of service code 24, saying that the TC was subject to an institutional bundling rule (which, in fact, was not true). Transmittal 2714, issued May 24, 2013, updates the Medicare Claims Processing Manual to memorialize the end of the hospital TC-bundling grandfather exception for pathology services effective July 1, 2012. However, as part of the transmittal, CMS also clarifies the ASC TC-bundling issue. The implementation date of the transmittal is June 25, 2013. Specifically, CMS states, “Payment is made under the physician fee schedule for TC services furnished in institutional settings where the TC service is not bundled into the facility payment, e.g., an ambulatory surgery center (ASC). Payment may be made under the physician fee schedule for the TC of physician pathology services furnished by an independent laboratory, or a hospital if it is acting as an independent laboratory, to non-hospital patients.”