ACLA Statement on Proposed 2019 Medicare Payment Changes

Proposed rule seeks input on how to improve data collection process; millions of seniors still at risk for continued cuts to essential Medicare lab services   

Washington, D.C. – Following the release of a proposed Medicare payment rule, The American Clinical Laboratory Association (ACLA) continues to raise concerns about the flawed implementation of the Protecting Access to Medicare Act (PAMA) that will lead to ongoing, year-over-year cuts to seniors’ lab services.

The proposed physician fee schedule rule gives stakeholders the opportunity to provide comments to the Centers for Medicare and Medicaid Services (CMS) on how to improve future data collection and reporting periods under PAMA. ACLA will urge Congress as well as CMS to address significant shortfalls in the data collection process that jeopardizes care for the most vulnerable seniors.

“We appreciate the opportunity to continue the dialogue on how data collection can be improved so that the private payor rates of all sectors of the laboratory market – hospital labs, independent labs, and physician office labs – are considered in determining Medicare reimbursement. Urgent changes are needed to ensure CMS’ regulations are consistent with the statute and protect patient access,” says Julie Khani, President of ACLA.

When Congress passed PAMA in 2014, the legislation directed CMS to collect private payor payment rates in order to establish a fair and predictable market-based payment system for clinical laboratories. Instead, CMS collected data from less than 1 percent of laboratories nationwide. By excluding more than 99 percent of the nation’s laboratories, CMS violated the statute and undermined Congress’s goal of protecting beneficiaries and supporting value-based care delivery.

As a result, in 2018 alone, Medicare beneficiaries faced more than $670 million in cuts to lab services. These unsustainable cuts continue into 2020 – leading to a drastic reduction of $3.6 billion from clinical laboratory services over three years.

As ACLA noted in its recent letter to the Senate Finance Committee, excluding sizable sectors from PAMA’s reporting requirements undermines any effort to establish a sustainable, “market-based” payment model and deliver the care that patients need. Addressing these persistent data collection gaps requires urgent action from Congress to avoid cuts to seniors’ benefits.

“Absent Congressional action, PAMA cuts will continue to jeopardize the preventive care and lifesaving diagnostics that millions of seniors depend on for their health,” ACLA President Julie Khani said.

Last year, ACLA filed a lawsuit against the U.S. Department of Health and Human Services (HHS) – ACLA v. Azar – for failing to comply with Congressional intent and unlawfully using flawed data in the transition to a market-based payment system.

To view the original complaint and release, click here. For ACLA’s motion for summary judgment, click here.  For more on the impact of PAMA, click here.

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ACLA is a not-for-profit association representing the nation’s leading clinical and anatomic pathology laboratories, including national, regional, specialty, hospital, ESRD and nursing home laboratories. The clinical laboratory industry employs nearly 277,000 people directly and generates over 115,000 additional jobs in supplier industries. Clinical laboratories are at the forefront of personalized medicine, driving diagnostic innovation and contributing more than $100 billion to the nation’s economy.


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