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<strong>CMS</strong>-1403-FC<br />

the diagnostic tests have <strong>been</strong> ordered by physicians<br />

outside the laboratory. A second commenter representing<br />

pathologists also suggested an exception for pathology<br />

practices (which it would define as any entity for which at<br />

least 75 percent of all CPT codes billed by the entity are<br />

pathology and laboratory codes). The commenter also cited<br />

the exclusion from the definition of “referral” in the<br />

physician self-referral rules for services ordered by<br />

pathologists pursuant to a consultation, and asserted that<br />

there should not be a self-referral or mark-up concern when<br />

pathology groups order special stains or other tests. A<br />

third commenter stated that the “rapid rise” in special<br />

stains in the last eight years is not a result of in-office<br />

pathology services or TC/PC arrangements, but rather is a<br />

result of the failure of national, regional, and hospital-<br />

based pathology laboratories to follow standard protocol<br />

for tissue biopsies. The commenter contended that over-<br />

utilization of anatomic pathology testing can be managed by<br />

imposing tighter controls on such laboratory-based<br />

pathologists with respect to what stains they order and the<br />

reasons for ordering them.<br />

Response: We are not establishing an exception that<br />

would be applicable to pathology practices or independent<br />

laboratories, to the anti-markup provisions. We note that<br />

514

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