Since 1995, Reliable Business Intelligence for Clinical Laboratories, Pathology Groups and Laboratory Diagnostics

TAG:

Protecting Access to Medicare Act (PAMA)

On April 1, 2014, President Barack Obama signed H.R. 4302: Protecting Access to Medicare Act (PAMA) of 2014. The law’s primary purpose was to extend the Sustainable Growth Rate (SGR) formula for 12 months.

Along with the SGR extension, PAMA addressed a grab bag of Medicare-related issues.

Under PAMA, many clinical laboratory organizations will see a substantial decline over the coming years in the prices paid to them for the highest-volume lab tests reimbursed under Medicare Part B. The law specifies that the federal Centers for Medicare & Medicaid Services (CMS) can begin enacting those price cuts in 2017.

Six aspects of PAMA specifically apply to clinical laboratories:

  • Setting prices with market data: Certain labs are required, as of Jan. 1, 2016, to report private-payer payment rates and volumes for their tests.
  • New category – Advanced diagnostics tests (ADTs): For certain tests developed and performed by single laboratories, the initial payment rate for ADTs will be set at the “actual list charge.” If the charge exceeds private-payer rates by more than 130%, CMS can recoup the overpayment.
  • Setting prices for new tests and expert advisory panel: To ensure transparent and reliable decisions about pay rates and coverage, CMS will assemble a panel of outside advisors, including clinicians and other technical experts. Also, CMS must follow either the crosswalk or gapfill process to determine the initial payment rates and explain, in a transparent manner, how the calculations were made.
  • Changes in how Medicare handles lab test codes: For new lab tests, CMS will use temporary HCPCS codes to enable payment prior to a permanent HCPCS or CPT code.
  • Coverage requirements and decisions: In support of fair and open coverage decisions for a lab test when a local coverage determination is needed, MACs must now follow a defined development and appeals process.
  • Oversight of the process to create coverage guidelines and set lab test prices: Two levels of oversight are written into the law: one by the U.S. Government Accountability Office (GAO), the other by the Office of Inspector General (OIG) of Department of Health and Human Services (DHHS).

Why It Matters That Your Lab Has Low Test Prices

TODAY, THE LAB INDUSTRY FACES A CONTRADICTION when setting prices for individual lab tests. At one extreme, a certain sector of labs seeking to win exclusive managed care contracts sets high-volume routine test prices at or below the fully-loaded cost to perform those tests. At another extreme, labor…

Read More



More Hospitals Consider Options for Their Labs

CEO SUMMARY: Is it a new sign of the times? After decades of reluctance to sell their lab outreach businesses or enter into inpatient lab management agreements with commercial lab companies, a surprising number of hospitals and health systems are taking that step. Since the first of the y…

Read More



Labs Ask: Does PAMA Statute Prevent Legal Challenges?

SINCE MEDICARE OFFICIALS PUBLISHED the final rule for lab test market price reporting of private payer prices last year, clinical lab industry consultants and lawyers have raised serious criticisms of the rule. The critics recognized that CMS officials wrote a final rule for the Protecting Access to…

Read More



PeaceHealth Outreach Laboratory Sells to Quest Diagnostics

This is an excerpt from a 1,471-word article in the February 21, 2017, issue of THE DARK REPORT. The complete article is available for a limited time to all readers, and available at all times to paid members of the Dark Intelligence Group. CEO SUMMARY…

Read More



PeaceHealth Labs Sold To Quest Diagnostics

CEO SUMMARY: In Oregon, one of the nation’s more successful and long-established health system outreach laboratories will cease to exist following its sale to Quest Diagnostics Incorporated. The seller explained that the Medicare Part B price cuts coming as a result of the PAMA market p…

Read More



Much Disruption for Labs In 2016’s Top 10 Stories

CEO SUMMARY: Within THE DARK REPORT’S list of the Top 10 Lab Industry Stories for 2016 is one story of disruption that might have been one story of disruption about to happen. The disintegration of Theranos during 2016 is the big story about a self-proclaimed disruptor of the lab indust…

Read More



OIG Comments on PAMA Plan and Exclusion of Many Labs from Reporting

ON THE SUBJECT OF LAB TEST MARKET PRICE REPORTING as required under PAMA, many clinical laboratory executives, pathologists, and industry experts see deep flaws in the process the federal Centers for Medicare & Medicaid Services has established. Yet, CMS itself seems blind to the…

Read More



Expert Explains Why Payer Errors Skew Labs’ PAMA Price Data

CEO SUMMARY: In its work with more than 200 lab clients, XIFIN, Inc., of San Diego, sees the best and worst of problems in how labs submit claims to lab tests and how payers process these claims. In this exclusive interview, Lâle White, XIFIN’s Founder and CEO, identifies the systemic …

Read More



Is CMS about to Create New Lab Winners, Losers?

FROM ITS INCEPTION IN 1966, THE MEDICARE PROGRAM WAS DESIGNED to give beneficiaries easy access to healthcare services while allowing any qualified provider to provide those clinical services. That is about to change for…

Read More



May 2, 2016 Intelligence: Late Breaking Lab News

Like the Sword of Damocles of Greek myth, market price reporting by labs under the Protecting Access to Medicare Act (PAMA) continues to hang over the heads of the nation’s clinical laboratories. However, instead of a threat, PAMA market price reporting may soon become a reality. News reports indi…

Read More



How Much Laboratory Business Intelligence Have You Missed?

Lab leaders rely on THE DARK REPORT for actionable intelligence on important developments in the business of laboratory testing. Maximize the money you make-and the money you keep! Best of all, it is released every three weeks!

Sign up for TDR Insider

Join the Dark Intelligence Group FREE and get TDR Insider FREE!
Never miss a single update on the issues that matter to you and your business.

;