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CMS-1403-FC
provisions due to the alleged economic losses and decreased
operating efficiencies that will result. The commenters
contended that the fact that the diagnostic equipment is
located in a separate building does not support an
inference that the diagnostic services are not an integral
part of the practice, as our proposal assumes.
Response: Under this final rule, the anti-markup
provisions will not apply to the TC or PC of a diagnostic
test where the performing physician shares a practice with
the billing physician or other supplier. With respect to a
TC or PC of a diagnostic testing service, the performing
physician is considered to share a practice with the
billing physician or other supplier if: (1) he or she
furnishes substantially all (at least 75 percent) of his or
her professional services through the billing physician or
other supplier; or (2) the TC is conducted and supervised,
or the PC is performed, in the office of the billing
physician or other supplier. We believe that, in the
situation where an arrangement would otherwise be subject
to the anti-markup payment limitation because the
performing physician does not furnish at least 75 percent
of his or her professional services through the billing
physician or other supplier, services that satisfy the
site-of-service approach indicate a sufficient nexus
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