ACLA Submits Comments on Gapfill Pricing for Molecular Pathology Services

(WASHINGTON, D.C.) The American Clinical Laboratory Association (ACLA) submitted comments today to the Centers for Medicare & Medicaid Services’ (CMS) regarding the agency’s 2013 gapfill pricing under the Clinical Laboratory Fee Schedule (CLFS) for molecular pathology services.

For 2013, CMS decided to use the gapfilling methodology to establish payment rates for more than 100 new Tier I and Tier II molecular pathology test codes which describe existing tests that Medicare had previously paid for under the CLFS. CMS concluded that most of the work for molecular pathology tests takes place in the laboratory and pricing should be determined under the lab fee schedule.

Under the “gap-filling” process, local Medicare contractors are charged with setting the fees for 2013 based on local pricing patterns, i.e., charges for the tests; discounts on the charges; required resources; payment amounts determined by other payers; and charges, resources, and payment amounts for tests that may be comparable. After the carriers submit their final prices for each code on September 30th, the contractor-specific amounts will be used to calculate a national reimbursement rate for each molecular pathology code, which will be implemented in 2014.

“Unfortunately, the gapfilling process thus far has been anything but smooth,” said Alan Mertz, President of ACLA. “We repeatedly have voiced our concerns with the lack of transparency in the instructions that CMS has given to contractors who priced the molecular pathology tests and in the methods the contractors have used to arrive at their prices. Prices for several of the tests are set too low, and will not even cover some labs’ costs of furnishing the tests.”

As providers of millions of clinical diagnostic laboratory services for Medicare beneficiaries each year, ACLA member companies have a direct stake in ensuring that prices for molecular pathology services are developed openly, payment disruptions are minimized and pricing levels represent reasonable compensation for developing and providing the services.

In their submitted comments, ACLA cites concerns that certain contractors used the gapfilling exercise inappropriately to establish new non-coverage policies, rather than exclusively for setting prices. CMS has a separate and detailed process for establishing local coverage determinations (LCDs) that contractors should use to make coverage decisions. Additionally, ACLA alleges that the agency’s administration of the process has left many questions unanswered, and the disposition of several issues will have a real impact on member laboratories’ operations and ability to offer these tests in the future.

ACLA urges CMS to correct the failings of the current gapfilling process by modifying prices where appropriate and giving contractors better instructions concerning the relationship between gapfilling prices and the coverage process to ensure that contractors do not attempt to shortcut the LCD requirements. ACLA also requests that CMS respond to the multitude of operational questions that have arisen concerning how this process will work going forward.

The comment period ends Monday, July 8, 2013.

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