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CMS-1403-FC
equipment, administrative services, billing and collection
services, and other services and then bill for the PC
itself. The commenter urged that net charges should be
defined to include these overhead costs rather than just
the amount the physician group pays the pathologist to
perform the PC. According to this commenter, it is
critical that physicians be able to recoup actual and
readily allocable costs attributable to these services. If
they cannot, the commenter predicted, gastroenterology
groups will be forced to stop utilizing their labs for
Medicare-reimbursed services, and patient care will suffer.
Another commenter suggested that we allow a group
practice to include in the calculation of “net charge”
actual additional incremental costs incurred by the group
which are directly allocable to the provision of the
service, for example, rental charges for a facility used
exclusively to provide diagnostic tests. If billing or
administrative staff are hired by the group solely to
provide billing services related to the provision of
diagnostic tests, such costs should appropriately be
considered in calculating net charge. The commenter
contended that requiring that such costs be associated
exclusively with providing the diagnostic tests for which
payment is sought will ensure that only costs actually
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