ACLA Sues HHS over Market Price Study, Fee Cuts

IT’S A LONG-AWAITED DEVELOPMENT! Today, a federal lawsuit was filed against the Department of Health and Human Services (HHS) by the American Clinical Laboratory Association (ACLA).

The lab association is asking a federal judge to review specific actions taken by the Centers for Medicare and Medicaid Services in how it is implementing sections of the Protecting Access to Medicare Act (PAMA).

In its press release, ACLA stated, “The government agency that runs the Medicare program failed to follow a congressional directive to implement a market-based laboratory payment system, thereby jeopardizing Medicare patients’ access to vital laboratory services.” The lawsuit was filed in the United States District Court for the District of Columbia.

ACLA further said, “The lawsuit asserts that CMS, operating under the purview of HHS, ignored congressional intent and instituted a highly flawed data reporting process in advance of setting market rates under the Protecting Access to Medicare Act (PAMA). Contrary to Congress’s directives, the overwhelming majority of laboratories were prohibited from reporting private payer data. As a result, CMS failed to protect access to laboratory services for Medicare beneficiaries. 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.”

One interesting twist in this litigation is that ACLA is represented by an attorney who was formerly the Deputy Associate General Counsel for Litigation, CMS division of HHS. Mark D. Polston, a partner at King & Spalding, is lead counsel for ACLA.

One the four things for which ACLA seeks a judge’s ruling is this request: that the court issue an “injunction that (1) directs the Secretary to withdraw or suspend his final rule until such time as it can be brought into compliance with the statute, and (2) directs the Secretary to withhold applying the new Clinical Laboratory Fee Schedule until such time as the Secretary has made appropriate revisions to his final rule.”