ACLA to CMS: Overall Finalized Rates Still Fundamentally Flawed, Agency Must Halt Implementation

(Washington, D.C.) –   The American Clinical Laboratory Association (ACLA) stepped up its call to the Centers for Medicare & Medicaid Services (CMS) to delay its flawed implementation of Congress’ efforts to modernize the Medicare clinical lab payment system and align payment rates with market prices in the Protecting Access to Medicare Act (PAMA).  While ACLA acknowledged several modifications to the draft rates by CMS following the public comment period, the association repeated its concerns with the failure of the agency to include the broad laboratory market in data collection as required by PAMA.

“The final payment rates published today make clear CMS ignored Congress’s instructions to gather commercial price information from all sectors of the clinical laboratory market and base Medicare payment rates on that data, an objection ACLA and many other stakeholders have made since CMS first proposed its data collection methodology in 2015. CMS’ decision today to move forward with these rates is ill-advised, inconsistent with the statute and, most importantly, detrimental to patient care. Implementation of a modified Clinical Laboratory Fee Schedule (CLFS) that is inconsistent with PAMA must be delayed,” said Julie Khani, president of ACLA.

Khani reiterated ACLA’s grave concern that the data collected was grossly compromised because CMS excluded key market information which will result in cuts that go far beyond what Congress intended.  “The final rates are based on insufficient and unrepresentative price information that does not accurately reflect the greater laboratory market. CMS has pressed forward with a flawed approach and produced a flawed outcome,” stated Khani.

From the outset, ACLA has advocated for a rational payment system that provides predictability, rewards innovation and maintains access to lab services for Medicare beneficiaries. To that end, the association recently joined 21 other stakeholders in a letter to CMS Administrator Seema Verma requesting “immediate action to address the significant deficiencies in its process to establish new clinical laboratory payment rates.” Additionally, ACLA submitted comments to CMS in response to the agency’s proposed market data reporting and collection requirements and the September 2017 announcement of the proposed payment rates that are based upon incomplete data.

“ACLA has worked diligently with the stakeholder community and CMS to get CLFS reform right,” said Khani.  “Congress was clear that a market-based rate solution would best serve the lab community and patients in need of important test services. ACLA supported PAMA based on congressional intent. We strongly urge CMS to suspend its flawed implementation of PAMA until the process adheres to what Congress intended.  We will advocate before all branches of government, including the courts if necessary, to ensure the best outcome for clinical laboratories and the Medicare beneficiaries we serve.”

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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, ESRD, hospital 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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