Certain Medicare Lab Reforms May Make It Through Congress

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ONE CONSEQUENCE of the terrorist attacks on September 11 is that proposed reforms to Medicare lab reimbursement policies have assumed a lesser priority with the current Congress.

Despite that fact, Congress must still address the day-to-day requirements of managing government functions. Thus, there is still activity under way to develop and pass bills affecting funding and policy issues for the Medicare and Medicaid programs.

“There is a measured degree of optimism that certain reforms involving lab testing may yet be passed by this Congress,” stated David N. Sundwall, M.D., Executive Director for the American Clinical Laboratory Association (ACLA), based in Washington, DC.

“We are hopeful that action will be taken to bring about a national fee schedule for lab testing services,” he noted. “That will benefit labs in several ways. However, given recent events, it is now unlikely that overall funding for lab testing will be increased.”

Specific Reform Proposals

Dr. Sundwall noted that one reform measure that has promising prospects for enactment would allow labs to choose a single Medicare carrier. “There are some very tangible proposals to reform the way Medicare contracts for lab testing services,” he indicated. “One element would allow labs to select and work with a single Medicare carrier. Another would bring more transparency to Medicare contracting procedures. For example, CMS (Centers for Medicare and Medicaid Services) would be more open to input and comments from laboratories during reviews of new testing technology and similar issues.”

Recently CMS Director Thomas Sculley disclosed that reimbursement for the physician professional component would be reduced 4% in the next fiscal year. “This will certainly impact pathology professional fees,” noted Dr. Sundwall. “When Medicare does cut physician fees by 4% across the board, it will be the first-ever reduction in the RBRVS schedule. This action demonstrates how priorities are shifting within the Medicare program.”

Earlier this year, two bills were introduced into the House and Senate. Numbered as H.R. 1798 and S. 1066, the Medicare Patient Access to Preventive and Diagnostic Tests Act was designed to implement a number of the reforms to Medicare lab reimbursement policy recommended by the Institute of Medicine (IOM).

“We never expected to see the IOM’s complete list of reforms passed. But there was enough Congressional support to give us hope that key reforms, along with additional funding, might be possible,” explained Sundwall. “Despite recent events, the lab industry has garnered important attention to see at least a few long-overdue reforms enacted.”


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