In a transmittal published on January 26, 2007, CMS has implemented new conditions for Independent Diagnostic Testing Facilities (IDTFs) which take effect on February 26, 2007.  The transmittal is posted here: 

·         IDTFs may not share space or equipment with another active Medicare supplier. (Note: Physicians owning an IDTF and sharing space are exempt from this requirement.)   Reportedly, CMS has informally interpreted "supplier" broadly to include physicians, which may jeopardize many common leasing arrangements between ITDFs and physician practices.

·         Non-physician personnel that work at the IDTF that require certification or a license (e.g. technicians) must be full-time W-2 employees of the IDTF itself, not subcontractors.  It is unclear whether CMS will approve any common-paymaster or employee leasing arrangements.

·         IDTFs may not be reimbursed for any services provided to Medicare beneficiaries prior to the date the carrier approves the IDTF application.  New physicians must be added to the ITDF’s account and processed before the IDTF can be paid for interpretations performed by such new physicians.  These payment delays are likely to result in cashflow problems for IDTFs. 

At this time it appears unlikely that an extension of the effective date will be granted by CMS.  All IDTFs should immediately review their compliance with these standards and take action to bring them into compliance by the deadline.  Noncompliant lease arrangements should be evaluated and it may be advisable to suspend or discontinue services to Medicare beneficiaries under such arrangements after February 26 until the implications can be sorted out.
A teleconference has been scheduled by the American Health Lawyers Association for February 20, 2007 at 1 pm Eastern time to explore the implications of these new requirements.  Fox Rothschild partner Bill Maruca will participate in the panel discussion along with attorney Tom Greeson and James Bossenmeyer of CMS’s Program Integrity Division.  Details and signup information is available here: .  The teleconference information/registration page is here:
For more information, contact
William H. Maruca
Fox Rothschild LLP
625 Liberty Avenue
29th Floor
Pittsburgh PA 15222
412-391-6984 fax