Advocacy - Lab Advocate
Legislation intended to address the flawed methodology used by the Centers for Medicare and Medicaid Services (CMS) to set reimbursement rates under the Protecting Access to Medicare Act (PAMA) was recently introduced by Sens. Sherrod Brown, (D-OH), and Richard Burr, (R-NC)., and Reps. Gus Bilirakis, (R-FL)., Richard Hudson, (R-NC)., Bill Pascrell, (D-NJ), Scott Peters, (D-CA), and Kurt Schrader, (D-OR).
The Saving Access to Laboratory Services Act (SALSA) would institute a statistical sampling-based approach to collecting lab test pricing data under PAMA. If enacted, the new methodology would reduce the administrative burden of payment reporting, while creating a more representative sample of labs for making payment adjustments (e.g. including more data from hospital outreach and physician office labs). Additionally, the bill would halt planned payment cuts for 2023 and increase the interval for reporting data from three years to four. SALSA would also cap payment cuts and increases at 5%.
Enacted in 2014, PAMA was intended to more closely align lab reimbursement rates with private payors. However, the definition of an applicable laboratory used by CMS disproportionately overrepresented large commercial labs which typically accept lower payment rates due to economies of scale. AACC and others in the lab community have long argued that this skewed data set led to significantly lower CLFS prices than intended.
Accordingly, AACC has been working with its lab allies to fix to the payment methodology. In 2019, AACC backed the congressionally passed Laboratory Access for Beneficiaries (LAB) Act, which delayed the pending PAMA reporting requirements of lab payment data required by PAMA. Notably, the LAB Act called on the Medicare Payment Advisory Commission (MedPAC) to review the payment structure and make recommendations. MedPAC’s agreed with concerns of the laboratory community and recommended a new statistical approach – as SALSA proposes. The association is currently reviewing legislation and will likely endorse it in the coming weeks.