December 14, 2022

CPT Codes: An Exciting Step Forward for Digital Pathology

Digital pathology has been rising in popularity over the past few years, thanks to the many efficiencies it offers pathologists. Now, the American Medical Association (AMA) has recognized this shift by announcing the introduction of 13 new Current Procedural Terminology (CPT) codes for digital pathology, set to go into effect in January 2023.

The codes are Category III, defined as a temporary set of codes for emerging technologies, services, procedures, and service paradigms. They are primarily meant to track whether a new technology is widely utilized and consistent with current medical practice, to help inform the creation of permanent Category I codes that would allow providers to be reimbursed for their use of the technology.

This is an incredibly exciting moment for pathology, as it marks a turning point in the way digital pathology is viewed and used in clinical practice. It is also a call to action. The time is now for labs not only to embrace digital pathology, but to work together to create a landscape that incentivizes the entire industry to do so. Widespread adoption will further accelerate development of novel tech like AI, with the potential to revolutionize cancer care.

A Milestone for Digital Pathology

The challenge with digital pathology so far has been that it requires a shift in the way labs work; digitizing glass slides means more work for the clinical staff and additional service requirements, which can be time consuming. Yet there has been no mechanism to seek reimbursement for this time and effort. The introduction of the new CPT codes is the first step toward changing that.

While these are Category III codes which will not have relative value units (RVU’s) and reimbursement rates assigned to them, they do provide a clear way for key stakeholders such as CMS and the AMA CPT Editorial Panel to track the scale of digital pathology utilization going forward. This will hopefully demonstrate that adoption has been substantial and create a sense of urgency for creating codes that do have reimbursement rates attached, to both compensate those labs that have already made the switch and encourage lagging labs to take the leap to digital.

Further, these codes represent an important milestone, as they signal recognition of digital pathology by the AMA and other physician societies, which helps to cement its place in the industry and position it for greater adoption down the line.

Next Steps

Despite marking an important moment for the industry however, until the current codes are converted to Category I, reimbursement remains at the discretion of Medicare contractors and private payers, and is expected to remain sparse and inconsistent for now. So, it is critical that the industry, including labs, the College of American Pathologists (CAP), and groups like the Digital Pathology Association (DPA), joins forces to push these codes for Category I status and create a more favorable and predictable reimbursement landscape.

In the near term, this involves educating the pathology community on the importance of these codes and why they must participate in actively reporting them as of January 2023. Then of course, those pathology labs that digitize slides as part of one of the 13 common pathology procedures must report the appropriate add-on code in conjunction with the primary Category I service code.

In the longer term, the industry must partake in active education efforts not just on the efficiency advantages of digital pathology, but also the impact it can have on treatment decisions and patient outcomes, by investing in robust studies that demonstrate the ROI to labs and to payers. Finally, there must be a concerted push for inclusion of digital pathology in medical guidelines.

While these efforts may seem a large undertaking, there are many examples of success across similar fields. In the cases of radiology and remote cardiac monitoring, Category III codes showed the technology to be widely utilized and ultimately lead them to be converted to Category I codes. However, the process in these cases took several years, due to the slow uptake or under-reporting of those new technologies.

On the other hand, the profound impact digital pathology could have on pathology workflows and ultimately patient care should inspire labs to go digital sooner than later. Should that be the case, and provided the entire industry bands together to tackle this new frontier, there is hope that digital pathology’s journey from Category III to Category I could be accelerated to as soon as 12-18 months.

The Road Ahead

Still, it is important to remember that these codes are just the tip of the iceberg. For now, they account only for the process of scanning glass slides into a digital format, but the true potential of digital pathology lies in the ability to access AI. Pathology AI algorithms can help pathologists diagnose diseases with greater efficiency and accuracy, as well as detect biomarkers that can inform patient treatment at the point of diagnosis.

Working toward establishing coding and payment for these downstream procedures as well will allow clinicians and patients to fully reap the benefits of AI for pathology, not just by way of incremental reimbursement but by equipping anatomic labs to be able to offer innovative AI biomarkers that directly inform precision medicine.

In the meantime, the establishment of the first set of CPT codes is an exciting milestone for digital pathology, and hopefully, will inspire more and more labs to go digital in the coming months. Most importantly, it sets the stage for the power of digital pathology and AI to translate to better patient care in the immediate future.