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Over 30 Groups Urge Congress to Address Concerns Over PAMA Implementation

NEW YORK (GenomeWeb)  A group of more than 30 organizations, including the American Clinical Laboratory Association, AdvaMedDx, and the American Association for Clinical Chemistry, have asked members of Congress to step in and enact legislation to address their concerns over the implementation of the  lab test pricing law, Protecting Access to Medicare Act.

PAMA, which became law in 2014, established a market-based pricing system for clinical lab tests where Medicare payment for a test is calculated based on the weighted median of private payor rates. The Centers for Medicare & Medicaid Services last year finalized rates on the clinical lab fee schedule (CLFS), which went into effect this year and are expected to save CMS $670 million.

However, upon seeing the deep cuts to some lab sectors, many in the industry expressed concerns about the implementation of PAMA, mainly that CMS largely excluded hospital labs from reportng its private payor test prices. Although CMS has argued that its exclusion of hospital labs wouldn't have altered pricing meaningfully, ACLA disagrees.

The lab group sued CMS, accusing it of ignoring congressional intent to create a "market-based payment system," and of implementing "a payment system based on a specious data collection process" that excludes 99 percent of the laboratory market.

This week, ACLA and others, including several hospital groups — the Association of Public Health Laboratories, the American Hospital Association, and America's Essential Hospitals — are asking Congress to step in as well.

The letter, sent to leaders in the Senate Finance Committee, the House Ways and Means Committee, and the House Energy and Commerce Committee, asks lawmakers to enact legislation that will modify PAMA and address data integrity concerns and market exclusion by establishing a statistically valid process; ensure that CMS collects data that represents all segments of the clinical lab market; and establish a transparent process by which the data collected by CMS can be validated.

Recently, the US Health and Human Services’ Office of Inspector General issued a report stating that while limited reporting may not have had a meaningful effect on 2018 rates, "it remains a risk in future data reporting periods." OIG flagged aspects of CMS’ data collection process, for example, that  relied on labs' self-certification of reported data. CMS performed few quality assurance checks, and OIG recommended that the agency enhance its efforts to ensure that labs are reporting data they're required to.

According to the organizations writing to Congress, the deep pricing cuts that have resulted from CMS' implementation of PAMA have already resulted in labs having to cut staff, and limiting or ending services, such as home care visits, which negatively impacts care for vulnerable populations. If these cuts are allowed to remain, labs may have to shut down more operations, lay off staff, and eliminate more tests that serve critically needy segments of the Medicare population.

"Without action by Congress, PAMA will create serious health care access and public health issues for Medicare patients," they wrote. "In a medical age where technology is pushing closer to patients, the bureaucratic policies implemented through PAMA will drive care and the promise of better health further away from patients."