Medicare’s local coverage decision process needs legislative fix

Nov. 21, 2016

In recent years, the pathologist’s ability to make medical decisions in the best interests of patients has been adversely affected by faulty decisions in Medicare’s local coverage program, a government-approved process lacking in transparency and accountability.

Specifically, the process for drafting Medicare local coverage determinations (LCDs) has interfered with the physician’s medical judgment and what is in the best interests of his or her patient. As all physicians know, these determinations can cover a range of items and services including medical procedures, office visits, imaging, drugs, and laboratory tests. In pathology and laboratory medicine, an erroneous LCD prevents patients from receiving the right test at the right time.

For these reasons, the introduction of new legislation to improve the LCD program is necessary and welcomed. Recently, two new bills were proposed that seek to reform the LCD process. Both H.R. 5721, introduced by Rep. Lynn Jenkins (R-KS) and Rep. Ron Kind (D-WI), and its companion bill S. 3392, introduced by Sen. Johnny Isakson (R-GA) and Sen. Tom Carper (D-DE), deserve the attention of all provider and patient advocacy organizations.

Released in January 2014, a report by the Department of Health and Human Services’ Office of Inspector General (OIG) found more than half of Medicare Part B “procedure codes were subject to an LCD in one or more States,” and that “LCDs defined similar clinical topics inconsistently.” In other words, Medicare—a national program—has no consistent approach to determining coverage for more than half of Part B’s procedural codes, and LCDs in one area may not be implemented in another because of inconsistency in clinical definitions.

While the OIG’s report is broadly critical of this approach to LCDs, it does not detail the very specific concerns the College of American Pathologists (CAP) and other provider organizations have with LCDs: the disturbing trends by some Medicare Administrative Contractors (MACs), which appear to set practice standards or determine where utilization thresholds are imposed using what many experts believe is selective and, in some cases, dubious evidence. Additionally, we’ve seen LCD evidentiary standards that are highly selective, misrepresent the opinions of national organizations, and contain several key premises that are unsubstantiated.

Furthermore, we’ve witnessed the erosion of the Carrier Advisory Committee (CAC) process. The role of CAC representatives, specialists in their field, is to advise MACs on LCDs, but in several cases, no meaningful dialog with CAC representatives during the policy development process occurs. Finally, there are no meaningful appeals processes for providers/supplies when a MAC either denies a reconsideration request or declines to make changes to an LCD.

Reforms contained in the proposed legislation will ensure that Medicare local coverage determinations do not override physician medical judgment and deny patients access to medically necessary care. The bills would ensure that coverage decisions are made by qualified, independent health experts through a transparent process based on sound medical evidence.

Briefly, the key provisions in the Senate and House bills include:

Open meetings: CAC meetings must be open, public, and on the record. Minutes should be posted to the MAC’s website for public inspection. The gravity of limiting or precluding coverage for both beneficiaries and practitioners heightens the need for transparency where meetings are currently closed.

Upfront disclosure: MACs should include at the outset a description of the evidence considered when drafting an LCD as well as the rationale they rely on to deny coverage. If this information is not provided until the final LCD, it hinders meaningful stakeholder exchange and makes the MAC’s decision to deny coverage almost a foregone conclusion.

Meaningful reconsideration and options for appeal: A meaningful LCD reconsideration process gives Medicare providers and suppliers the opportunity to have a secondary review by a qualified, disinterested party. Under current CMS rules, MAC LCDs are essentially unreviewable by providers and suppliers without new evidence submitted to the very MAC that issued the LCD.

Stopping the use of LCDs as a back door to national coverage determinations (NCDs): This will prohibit the CMS from appointing a single MAC, either expressly or in practice, to make determinations that are to be used on a nationwide basis in a given specialty. The CAP has witnessed the carbon-copy adoption of MAC LCDs by other MACs without the benefit of meaningful solicitation or independent assessment of comments and concerns from the public or medical community of the adopting MAC. The policy then can become of such geographic magnitude that it approaches becoming an NCD in practical terms without having followed more rigorous requirements.

Reform of the LCD process is critical. The CAP believes current LCDs might cause pathologists to choose other testing methods or seek approval to use certain testing methods that delay diagnosis and possibly patient treatment. In other instances, some LCDs have the potential to direct pathologists to practices that predispose misdiagnosis, deny patients services from which they may benefit, or subject them to harmful and unnecessary interventions, particularly regarding some difficult-to-diagnose malignancies. Providers have joined together to support H.R. 5721 and S. 3392 so that physicians are able to provide care consistent with the best clinical evidence, not the decisions of a third-party insurance administrator.

Over the last 20 years, Richard Friedberg, MD, PhD, FCAP, has served on numerous committees and councils for the College of American Pathologists (CAP), including the Government & Professional Affairs, Accreditation, Quality Practices, Technology Assessment, Transformation, Finance, and Transfusion Medicine. In 2007 and again in 2010, he was elected by the CAP membership to serve on the CAP Board of Governors. In 2013, the CAP membership elected him to serve as CAP President-Elect, and he is serving as CAP President from 2015-2017.