The Centers for Medicare & Medicaid Services (CMS) will continue to collect data from physician-owned laboratories to inform private payer rates despite pushback from the Texas Medical Association.
The Clinical Laboratory Improvement Act (CLIA) allows CMS to regulate all laboratory testing (except research) done in U.S. physician offices and other health care facilities. As an ongoing requirement of that law, CMS collects laboratory data from physicians.
In November, Congress delayed the data-reporting requirements for certain clinical diagnostic laboratory tests (CDLTs) and the phase-in of payment reductions from private payers.
However, CMS recently announced it will resume data collection on Jan. 1, 2025. The agency also will require data from the original collection period of Jan. 1 to June 30, 2019.
CMS also extended the phase-in of payment reductions resulting from private payer rate implementation. While no payment reductions will occur in 2024, payment will be reduced between 2025 and 2027. CMS states it will apply a 0% payment reduction for 2024 and will not reduce payment more than 15% per year moving forward.it will apply a 0% payment reduction for 2024 and will not reduce payment more than 15% per year moving forward.
This will affect:
- Physician-owned laboratories;
- Hospital laboratories;
- Laboratory suppliers; and
Other health care professionals billing Medicare Administrative Contractors (MACs) for services they provide to Medicare patients.
CLIA was established with the aim of strengthening federal oversight of clinical laboratories and ensuring the accuracy and reliability of patient test results. However, TMA remains concerned that the phased-in reductions in payment for laboratory tests will harm physicians.
Additionally, TMA in a comment letter last year that pointed to the next round of Medicare cuts, which could decrease payment another 15% for 800 laboratory tests widely used for screening.
“Clinical diagnostic tests are foundational to clinical decision-making, informing 70% of medical decisions that guide patient care. Between 2017 and 2022, payment for common tests for diseases like diabetes, cancer, and heart disease were cut by 27%,” TMA stated. “TMA would support a change in federal law to eliminate the reporting requirement or prohibit the use of lab reporting information for rate-setting.”
For now, TMA experts recommend billing staff take note of the next private payer data reporting period – Jan. 1 to March 2025 – and check for new and deleted health care common procedure coding system (HCPCS) codes.
All health care settings performing laboratory tests must have a CLIA certificate. Physicians can use the U.S. Department of Health and Human Services’ (HHS) certification database to find which certificate their practice needs.
For more information and resources on billing and coding, check out TMA’s comprehensive Billing, Coding, and Reimbursement page.
Alisa Pierce
Reporter, Division of Communications and Marketing
(512) 370-1469