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PAMA 2019 Fee Schedule Changes are Insufficient, Lab Groups Say

NEW YORK (360Dx) – Recently released changes to how market-based lab pricing data will be collected as part of the Protecting Access to Medicare Act do not go far enough to address concerns of the lab industry, lab groups said.

The Centers for Medicare & Medicaid Services revealed changes to its data collection methods in its 2019 Physician Fee Schedule Final Rule, released online on Thursday. But while the new data collection criteria are expected to increase the number of hospital outreach laboratories required to report data for the establishment of market-based pricing, lab groups say the data collection process needs further modifications.

"This initial step recognizes the flaws in the agency's approach to implementing PAMA and represents a starting point in advancing a more sustainable, competitive market for millions of seniors who depend on clinical diagnostics for their health," American Clinical Laboratory Association President Julie Khani said in a statement. "At the same time, more needs to be done to protect seniors, including the most vulnerable beneficiaries, from significant disruption to their Medicare Lab benefits."

CMS first proposed changing how PAMA lab pricing data is collected in a proposed rule released in July that drew hundreds of responses from lab industry stakeholders.

Specifically, the new rule changes lab pricing data collection by using the CMS-1450 14X type of bill to identify Medicare revenues from hospital outreach labs. This rule is expected to increase the reporting of lab test prices by hospital outreach labs. Previously, hospital outreach labs were excluded from reporting lab pricing data because there was no accepted billing method for identifying their pricing data. Another change to the new rule involves excluding Medicare Advantage revenues from the equation for calculating total Medicare revenues.

The National Independent Laboratory Association and its parent organization the American Association of Bioanalysts expressed concern over the delayed date in which the changes introduced by the new rule will go into effect.

"These modifications are insufficient because the changes outlined in the final PFS rule will not take effect until 2021. Regional and community clinical laboratories face an unsustainable 10 percent cut in less than two months, on January 1 2019," Mark Birenbaum, administration of NILA and AAB, said in a statement.

Last month, ACLA appealed a lawsuit it had filed against CMS over PAMA pricing that was dismissed by a US District Court Judge in September. The recent CMS changes have not changed the association's position on fighting PAMA implementation in the courts, according to the association's statement. The association also called on Congress to take legislative action.

"Seniors cannot wait for the courts to take action. It's incumbent upon congressional leaders to step in and protect millions of seniors," Khani stated.

NILA maintains its opposition to the implementation of PAMA, and it advocates for an immediate delay in future Clinical Laboratory Fee Schedule reductions until a system based on the entire clinical laboratory market can be worked out, according to Birenbaum.