ACLA Statement in Response to U.S. Court of Appeals Ruling in ACLA v. Azar

July 30, 2019 Categories: All News, Featured News, ACLA Press Releases

Court of Appeals Says ACLA is Entitled to Challenge HHS’s Harmful Regulatory Overreach 

Washington, D.C. — In response to today’s ruling from the U.S. Court of Appeals for the District of Columbia in favor of the American Clinical Laboratory Association (ACLA) in its lawsuit against the Department of Health and Human Services (HHS), ACLA President Julie Khani issued the following statement:

“We strongly commend the Court of Appeals’ decision and are very encouraged that it recognizes that ACLA is entitled to challenge the harmful regulatory overreach by the HHS Secretary in his implementation of the Protecting Access to Medicare Act (PAMA). HHS’s continued flawed data collection process poses a direct challenge to the rule of law and PAMA’s intent to support a sustainable, market-based laboratory market for millions of seniors. On behalf of those who have already seen the consequences of this painful overreach, we urge the District Court to act quickly to rule on the merits of ACLA’s case.”

In its brief, ACLA argued that “Congress precluded judicial review of only ‘the establishment of payment amounts.’ It did not bar review of the Secretary’s final regulations establishing the parameters for collecting confidential data from laboratories.” The Court of Appeals upheld this distinction and noted that, “PAMA’s data collection provision…is distinct from its rate-estimation provisions.”

“For data collection, the statute obligates clinical laboratories that participate in the Medicare program to report distinct reimbursement rates they receive from private insurers and requires the Secretary to establish the rules governing that reporting through notice and comment rulemaking. To be sure, the results of that data collection process are used to establish Medicare payment amounts. But the statute’s bifurcated structure supports ACLA’s view that the two provisions and the processes they require are distinct…That the statutory scheme requires private laboratories to report non-Medicare and generally confidential business information (private market rates) to the government on pain of monetary penalties further stands this statutory scheme in sharp contrast to others where the challenged action was found to be intertwined with other agency actions regarding which Congress had barred judicial review.”

The Court’s decision sends the case back to the U.S. District Court for the District of Columbia for review to ensure the Department’s continued regulatory implementation of the law adheres to Congressional intent in establishing clear, market-based parameters for data collection and calculation of rates in accordance with those guidelines.

While ACLA v. Azar continues to be under judicial review, it’s even more critical that Congressional leaders continue to advance bipartisan reforms that would provide a one-year delay of upcoming PAMA reporting activities. The Laboratory Access for Beneficiaries (LAB) Act would suspend data reporting for 2020, providing HHS and Congress the necessary time to address flaws in the current reporting process that continue to undermine seniors’ care.

“While today’s decision is an important moment for millions of beneficiaries, we urge Congressional leaders to immediately halt the data reporting process and allow time to ensure that HHS is implementing PAMA in the right way.”

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