CMS Publishes Final CLFS Rates, Labs Prepare to Cut Staff or Close

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MEDICARE OFFICIALS PUBLISHED the final Part B Clinical Laboratory Fee Schedule for 2018 last Friday. Some changes clinical labs will welcome. The rates remain deeply flawed, however, and will cause many labs to lay off staff and others to close, experts said Saturday.

How CMS set the rates remains problematic, stated Julie Khani, President of the American Clinical Laboratory Association and Mark Birenbaum, PhD, Administrator of the National Independent Laboratory Association. Both ACLA and NILA called for a delay beyond the scheduled implementation date of Jan. 1 for the new rates.

The 2018 CLFS was established under the Protecting Access to Medicare Act of 2014. Ironically, rather than protecting access to lab testing for Medicare patients, PAMA may have the opposite effect. The new rates are likely to force many labs to close, making it difficult for Medicare beneficiaries to access lab testing services, NILA said.

Lab Staff Layoffs Expected

“If these payments are not corrected, laboratories will be forced to lay off thousands of workers across the United States, eliminate services, or close their businesses altogether,” NILA predicted. After analyzing the proposed rates in September, ACLA, NILA, and XIFIN were unanimous in their criticism, saying the rates CMS proposed were deeply flawed.

Clinical lab directors, pathologists, and experts who analyzed the proposed rates were encouraged to explain their concerns to CMS. “CMS clearly did not listen,” Birenbaum said.

The intent of PAMA was to establish private market-based lab test rates. “CMS constructed a system where data from national laboratories with the highest test volumes and highest discounts in the private market dominate the data reported,” NILA charged. Also, CMS excluded data from labs that have high test volumes and higher payments from private insurers, the association added.

For a few clinical labs, however, the final rates were not universally bad. “Some changes are consistent with recommendations ACLA made in its comments on the preliminary rates, and we acknowledged these minor changes,” Khani said. “However, these changes do not address the failure of CMS to implement PAMA according to the intent of Congress.”

Lâle White, founder, Executive Chairman and CEO of XIFIN, a healthcare IT company serving clinical labs, agreed. “It looks like they took a number of the comments into consideration,” White said. “For example, the preliminary CLFS release did not cap codes that did not have a national limitation amount (NLA) at 10%. That cap was applied in the final release.

“The General Health Panel, which is not a payable Medicare benefit, was deleted from the new release,” she noted. The definitive drug G codes, which were materially changed in description in 2017, were not ignored as they should have been since they do not match the 2016 usage of those codes. However, CMS did cap the reduction on the G codes at 10%.”


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