Advocacy - Lab Advocate
Twenty-six members of the House Ways and Means Committee (the congressional panel with authority over Medicare payment issues) recently wrote to the Centers for Medicare and Medicaid Services (CMS) Administrator urging a delay in the implementation of the clinical laboratory provisions of the Protecting Access to Medicare Act (PAMA). The 2014 law requires the agency to re-base the clinical laboratory fee schedule to reflect private sector rates by January 1, 2017. The committee members pointed out that CMS has missed two statutory deadlines and that the laboratory community will need time to review and implement any new requirements once the final rule is published.
One of the key areas of contention for legislators and clinical laboratories is what data will be used to determine the new payment rates. CMS proposes that only healthcare entities that derive 50 percent or more of their total Medicare income from the physician fee schedule (PFS) and clinical laboratory fee schedule (CLFS) be required to submit payment information. This would exempt hospitals, since most of their Medicare payments are derived from Part A for inpatients. Physician office laboratories (POLs) that generate less than $50,000 annually in Medicare testing revenue would also be exempt.
AACC and others are urging CMS to collect payment information from a cross-section of testing facilities, including hospitals and POLs. Otherwise, the payment amounts would be skewed towards fees paid to large commercial laboratories, resulting in even larger reductions in payment rates since hospitals and POLs generally cannot offer volume discounts. Without any changes, the agency’s payment model would reduce lab reimbursement by $5.14 billion over 10 years, which is more than double the $2.5 billion Congress projected. The final rule is currently under review by the White House Office of Management and Budget. There is no date for the rule’s release.