Dive Brief:

• A range of industry stakeholders wrote Congress on Thursday seeking to mitigate "the harmful cuts to the Clinical Laboratory Fee Schedule (CLFS) that are now in effect because of the flawed implementation of the Protecting Access to Medicare Act (PAMA)."
• Signees of the letter, which asks committee leaders on both sides of the aisle to take legislative action, include the American Clinical Laboratory Association, American Hospital Association, AdvaMedDx and the American College of Physicians.
• In December, ACLA filed a lawsuit in the United States District Court for the District of Columbia challenging CMS' implementation of the new fee schedule, which effectively cut reimbursement for certain Medicare-covered lab tests.

Dive Insight:

ACLA argued in its original filing that CMS' update of the CLFS runs afoul of congressional intent, resulting in "dramatically reduced Part B payments — a decrease of approximately $670 million in calendar year 2018."

The industry group, which represents laboratories including Quest Diagnostics and the LabCorp, argued that CMS did not follow Congress' directions to implement a market-based lab payment system by prohibiting 99.3% of labs from reporting market information to HHS.

"This flawed process could cause serious financial harm to potentially thousands of hospital, independent and physician office laboratories, and make it harder for Medicare beneficiaries to get access to medical testing, particularly in remote rural areas and in nursing homes that depend on laboratory testing services," ACLA previously said in a statement. 

In the new letter to Congress, the groups reiterated the concerns raised in the lawsuit, writing that CMS is undermining lawmakers' goal of protecting patients and supporting value-based care.

According to the original lawsuit, data supporting the new CLFS "was collected from only the nation's two largest, independent laboratories, which are located predominately in large urban areas, and have much lower cost structures." ACLA argued the approach "cherry-picks data," resulting in lower Medicare reimbursement rates, threatening patient access to testing.

The groups wrote that in the first six months of the new reimbursement rates being in effect, labs have cut staff, resulting in limited or ceased home care visits for homebound patients.

"Without action by Congress, PAMA will create serious health care access and public health issues for Medicare patients. Without ready access to clinical laboratory services, patients risk missed or delayed diagnoses, increased barriers to maintaining their health, and forgoing the opportunity to prevent even worse health outcomes or disease," according to the letter.

Specifically, the groups ask Congress to implement legislation that would modify PAMA to expand data collection so private payer data "accurately represents all segments of the clinical laboratory market," with a process to validate such data.