In response to advocacy efforts, the Centers for Medicare & Medicaid Services (CMS) delayed the application of the expanded anti-markup rule that is published in the 2008 final physician fee schedule. The rule was to take effect January 1, 2008, and will now be implemented January 1, 2009.

According to the American Medical Association (AMA), the rule would have expanded the Medicare payment rule refereed to as the anti-markup rule. In its current form, the anti-markup rule limits the payment a physician can receive for the technical component (TC) of services the physician purchases from an outside supplier. In is expanded form, the new CMS rule would have applied the same payment limitations to the professional component (PC) of purchased diagnostic tests, as well as to the TC and PC of services performed by employees of physicians or group practices if the services are performed outside of the office of the physician or group practice.

The AMA notes the delay is not straightforward, though. It postpones the application of this new rule except in the case of anatomic pathology diagnostic testing services furnished in space used by a physician group practice as a "centralized building," which essentially means that this postponement only applies to diagnostic pathology services when the groups provides other patient care services at the site as well. This is intended to close a perceived loophole in the self-referral regulations that had allowed the operation of off-site "pod labs." CMS has stated the one-year delay is intended to allow clarification for the application of the rule, issuance of an additional proposed rule, or both.

More information on the anti-markup rule will be communicated to members as it becomes available. Contact Ted Thurn, AASM Senior Health Policy and Governmental Affairs Analyst, at or (708) 492-0930 with questions or for more information.