1970s and 1980s debates about physician pathologist fees for clin chem tests (42 CFR 415.102, 130).

 Direct AI output from Chat GPT 5.   Do not quote without verification.  Prompt at bottom.

The AI article draws quite a bit from a 2004 CAP TODAY article on this "obscure history."

https://www.captodayonline.com/Archives/feature_stories/0304Spiritofthelaw.html

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Short answer: yes—there’s a paper trail. The fight over whether pathologists could bill a “professional component” (PC) for every clinical lab test began in the late-1970s/early-1980s and led—through litigation, statute, and rulemaking—to today’s narrow definition in 42 CFR 415.130.

What kicked it off (1970s → 1980):
Pathologists in many regions were billing patients/insurers under Part B for PC on clinical pathology (oversight, protocols, QA/QC, availability to consult) even when they didn’t personally touch each specimen. HCFA (now CMS) moved to make treatment uniform and, in a March 11, 1980 notice, barred direct Part B billing for the PC—adopting the “New England” model where the hospital pays the pathologist and rolls costs into Part A. Pathologists (CAP and the Arkansas Society) sued immediately, and a federal court in Little Rock enjoined HCFA’s 1980 policy, recognizing the PC as “professional services performed for the benefit of patients.” (Cap Today)

Congress steps in (1982 TEFRA §108) & HCFA regulations (1983):
To resolve the stalemate, TEFRA §108 (1982) told HHS to distinguish:
(A) physician services personally rendered for an individual patient (Part B), versus
(B) professional services for the general benefit of hospital patients (Part A, paid via the hospital). HCFA implemented this in 1983 rules on “Payment for Physician Services Furnished in Hospitals,” establishing the Part A/Part B split for hospital-based physicians (including pathologists). (Cap Today)

Prospective payment flips incentives (1984–1987):
Once DRGs/OPPS replaced reasonable cost, hospitals no longer recovered whatever they paid for Part A “general benefit” pathology services, fueling recurring PC disputes in private insurance and state courts through the 1990s. A key federal case, Central States v. Pathology Laboratories of Arkansas (7th Cir. 1995), described PC activities (setting protocols, calibrating, supervising, consulting) and upheld PC billing under the plan’s terms (private insurance context). (Justia Law)

Codification as 42 CFR Part 415 and the narrow definition (1995–1999):
In December 8, 1995, HHS reorganized physician-in-provider rules into Part 415; this is the source note for § 415.130 (“Conditions for payment: physician pathology services”). The rulemaking history shows § 415.130’s lineage beginning at 60 FR 63178 (Dec. 8, 1995), later amended Nov. 2, 1999 (64 FR 59442) and in subsequent years. The section narrows what may be paid under the physician fee schedule to: (1) surgical pathology; (2) listed cytology/hematology/blood bank services requiring a physician; and (3) clinical consultations—i.e., not a blanket per-test PC. (eCFR)

The “TC bundling” fight & hospital-only payment (1999–2008):
Through the 1999 PFS final rule, HCFA announced it would pay only the hospital for the technical component (TC) of physician pathology for hospital patients—ending independent lab TC billing for hospital in/outpatients. Congress repeatedly delayed this via BIPA/MMA/TAX RELIEF extensions for “covered hospitals,” but the policy ultimately took effect for services after 12/31/2007, with CMS transmittals implementing edits in early 2007–2008. These actions are cross-referenced directly to § 415.130(d). (Centers for Medicare & Medicaid Services)

A clear through-line to the present § 415.130:

• Litigation (1980) blocked HCFA’s attempt to ban PC billing outright, prompting TEFRA §108 (1982) and 1983 rules that drew the Part A vs Part B line for hospital-based physicians. (Cap Today)

• 1995 reorganization placed these payment conditions into Part 415, and § 415.130 evolved via amendments (1999 and later) to spell out a narrow, enumerated list of pathology services payable under the PFS—surgical path, certain cytology/hematology/blood bank services, and consultations—not a per-test “PC for everything.” (eCFR)

• 1999–2008 rulemaking and transmittals then sealed hospital-only payment of TC for hospital patients, closing a major billing avenue and reinforcing the narrow scope of payable physician pathology services. (Centers for Medicare & Medicaid Services)

Helpful primary sources if you want to footnote:

• CAP Today’s historical explainer walking through 1965→1987, the 1980 notice, the Arkansas injunction, TEFRA §108, and 1983 regs. (Cap Today)

• 42 CFR 415.130 text and source notes (showing 60 FR 63178 (1995) origin; 64 FR 59442 (1999) amendment). (eCFR)

• 1999 PFS final rule and CMS transmittals implementing TC bundling for hospital patients and tying it to § 415.130(d). (GovInfo)

• Central States v. Pathology Labs of Arkansas (7th Cir. 1995) for the federal appellate description of PC activities (useful for context; private-plan case). (Justia Law)

If you want, I can assemble a one-page timeline with pinpoint FR cites (TEFRA §108 text, 1983 preamble language, 1995/1999 CFR notes, and the 2007–08 transmittals).

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42 CFR 415.130 DEFINITIONS - Pathologist Service

42 CFR 415.102(a) Services of a physician to individual beneficiary

Note that "ordinarily require performance by a physician" = >515

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Prompt

Ligation about pathologist fees, a bit of statute, and CFR rulemaking in the 1970s led to the creation of 42 CFR 415.130, which defines physician pathology services. The context was that pathologists sued CMS in the 1970s demanding they could get a professional (perhaps $3?) for every clin chem test run in their lab (!). CMS said no, and the point of 42 CFR 415.130 is to narrowly, not broadly, define the scope of services of a pathologist. It's pretty obscure, but do you have any information on the background of this debate and the creation of 415.130?