understanding the requirements for reporting pama private ... · spending for laboratory testing by...

UnderstandingtheRequirementsforReportingPAMAPrivatePayerLabTestPriceDataEXECUTIVEWARCOLLEGECONFERENCEMAY2,2019

Presentedby

DianaW.Voorhees,M.A.CLS,MT,SH,CPCOPrincipal/CEO

DV&Associates,[email protected]

DV&ASSOCIATES,INC. 2

ObjectivesRelivethecreationofPAMAanditsintenttochangetheClinicalLaboratoryFeeSchedulepaymentmechanismReviewreportingrequirementsandoutcomesthatraisedconcernsfromthelaboratoryindustryDescribefinalrulerequirementsanddiscussparticularlaboratoryconcernsandrelatedCMSresponseDeterminewherewearenowregardingPAMA


BackgroundInformation

ClinicalLaboratoryFeeSchedule(CLFS) Priorto2018:◦ OutpatientclinicallaboratoryserviceswerepaidbasedonafeescheduleinaccordancewithSection1833(h)oftheSocialSecurityAct

◦ Paymentwasthelesseroftheamountbilled,thelocalfeeforageographicarea,oranationallimitation◦ ThenationallimitsweresetatapercentofthemedianofalllocalfeescheduleamountsforeachlaboratoryHCPCScode

◦ Eachyear,feeswereupdatedforinflationbasedonthepercentagechangeintheConsumerPriceIndex


ClinicalLaboratoryFeeSchedule(CLFS)Priorto2018,Cont.◦ LegislationbyCongresscouldmodifytheupdatetothefees◦ Co-paymentsanddeductiblesdonotapplytoservicespaidundertheMedicareclinicallaboratoryfeeschedule

◦ Annually,newlaboratorytestcodeswereaddedtotheclinicallaboratoryfeescheduleandcorrespondingfeesweredevelopedinresponsetoapubliccommentprocess.


CMSConcerns◦ Currentfeeforservicepaymentsmaybeexcessiveespeciallywhencomparedtoprivatepayerpaymentrates◦ Example:50%ofMedicareallowables

◦ Evaluateprivatepayerreimbursements◦ NeededamechanismtooffsetremovaloftheSGR◦ TheCMSoriginalproposalindicatedthat75percentofallcodesintheHealthcareCommonProcedureCodingSystem(HCPCS)wouldrealizepaymentreductionsin2018–firstyearofrevisedfeeschedule.

◦ CMSfurtherestimatedthatthesecutswouldreduceoverallMedicarespendingforlaboratorytestingbynearly11percentor$670millionin2018.


ProtectingAccesstoMedicareAct(PAMA) Section216oftheProtectingAccesstoMedicareAct(PAMA)of2014madeextensivechangestohowreimbursementisdeterminedundertheClinicalLaboratoryFeeSchedule(CLFS).◦ PAMArepealed“technologicalchanges”authoritybyCMStomakeunlimitedreductionstoindividualtestcodeswithoutprovidingclearjustificationorrationale.

◦ Section216createdanewreimbursementframework,basingMedicarepaymentratesforlaboratoryservicespaidundertheCLFSonprivatepayerratesthatarereportedtoCMSby“applicablelaboratories.”


ProtectingAccesstoMedicareAct(PAMA)Basedonthefinalrule,applicablelaboratorieswouldbeginreportingprivatepayerrates,CMSwouldcreateaweightedmedianforeachlaboratoryproceduralcodeontheCLFS,andnewpaymentrateswouldgointoeffectonJanuary1,2017.Scheduleforimplementationwasdelayedayearduetolackofatimelyfinalrule,insufficienttimeforgatheringandreportinginformationbylaboratoriesandinsufficienttimetomassageandanalyzedata


ProtectingAccesstoMedicareAct(PAMA) TheintentofPAMAwastoensuretruemarket-basedpricingbysettingthefeescheduletoaweightedmedianofthecollecteddatafromlaboratories.TheuseofmarketdatatoestablishCLFSpaymentrateswill:◦ StrengthenMedicarebypayingmoreappropriatelyforlaboratoryservices◦ SavetheMedicareprogramandtaxpayersmoney◦ Maintainbeneficiaries’accesstohighqualitylaboratoryservice


ProtectingAccesstoMedicareAct(PAMA) AdditionalOutcome:◦ LocalFeeScheduleseliminated◦ Onlyonerateofreimbursementapplicabletoallgeographicareas


TheBasics

Definitionof“ApplicableLaboratory”◦ Alaboratory,(asdefinedinCMS’sCLIAregulations),usingitsNationalProviderIdentifier(NPI),isconsideredanapplicablelaboratoryifmorethan50percentofitstotalMedicarerevenuesarereceivedfrompaymentsundertheCLFSandphysicianfeeschedule(PFS).

◦ Additionally,anapplicablelaboratorywouldalsohavetoreceiveatleast$12,500inMedicarerevenuesreceivedforCLFSservicesduringadatacollectionperiodtobeanapplicablelaboratory.◦ The$12,500willnotapplytocertainlaboratorieswithrespecttotheADLTstheyofferandfurnish.


AdvanceDiagnosticLaboratoryTest(ADLT) Section216(a)ofPAMAestablishedanewsubcategoryofclinicaldiagnosticlaboratorytests(CLDTs)knownasAdvancedDiagnosticLaboratoryTests(ADLTs)withseparatereportingandpaymentrequirements.◦ CDLTsaredefinedbyCMSasteststhatincludebloodtests,urinalyses,testsontissuespecimens,andsomescreeningandotherteststhatarefurnishedbyapplicablelaboratoriesandcoveredunderMedicarePartB


ADLTDefinition,Cont.◦ PAMAdefinesADLTsasalaboratorytest(CDLT)thatis“coveredunderMedicarePartBthatisofferedandfurnishedonlybyasinglelaboratoryandnotsoldforusebyalaboratoryotherthantheoriginaldevelopinglaboratory(orasuccessorowner)andthatmeetsoneofthefollowingcriteria:◦ Thetestmustmeeteither◦ Criterion(A)(analysisofmultiplebiomarkersofDNA,RNA,orproteins)or◦ Criterion(B)(clearedorapprovedbytheU.S.FoodandDrugAdministration(FDA)).


ADLTDefinition,Cont.◦ OthersimilarcriteriamaybeestablishedbytheSecretaryofHealthandHumanServices◦ Noneexisttodate

◦ Additionally,anADLTtestisananalysisofmultiplebiomarkersofDNA,RNA,orproteinscombinedwithauniquealgorithmtoyieldasinglepatient-specificresult


ADLTExclusion CMSfinalizeditsproposaltoexcludesinglelaboratoriesofferingandfurnishinganADLTfromthe$12,500threshold.◦ ThismeansthatapplicableinformationforanADLTwouldneedtobereported,regardlessofwhetherthelaboratoryfallswithinthelow-expenditurethreshold.

 Alaboratorythathaslessthan$12,500inMedicarerevenues,butoffersbothADLTsandCDLTs,muststillreportprivatepayerdatafortheADLT◦ ButprohibitedfromreportingdataonitsCDLTs


ADLTPayment◦ NewADLTswillbepaidatarateequaltotheiractuallistchargeduringanewADLTinitialperiodofthreecalendarquarters.◦ Aftertheinitialperiod,thepaymentamountforanewADLTisbasedontheweightedmedianofprivatepayerratesfromdatacollectedbythelaboratoryduringthenewADLTinitialperiod.


TINversusCLIAversusNPI◦ TIN◦ Frequentlynotassociatedwithjustlaboratorytesting◦ Hospitalsareagoodexample:laboratoryreimbursementwon’tqualifywhencomparedtooverallMedicareincome

◦ CLIA◦ Everylaboratoryhasone◦ MedicalcentermayhaveseveralCLIAnumbersunderoneentity

◦ NPI–winningnumber◦ AllbillingprovidershaveaNPIsomewhere◦ Hospitaloutpatientservicesnowbundled◦  servicesmaybeincludedifmeetthreshold&NPI


Definitionof“ApplicableInformation”◦ ThereportingentitymustreportapplicableinformationforeachCDLTfurnishedbyitscomponentapplicablelaboratories.◦ Applicableinformationistheprivatepayerrateforeachtestforwhichfinalpaymenthasbeenmadeduringthedatacollectionperiod,theassociatedvolumeforeachtest,andthespecificHCPCScodeassociatedwiththetest.◦ Ifanapplicablelaboratoryhasmorethanonepaymentrateforthesameprivatepayerforthesametest,ormorethanonepaymentratefordifferentpayersforthesametest,thereportingentitywillreporteachsuchpaymentrateandthevolumeforthetestateachsuchrate.


Definitionof“ApplicableInformation”Reference:

MedicareLearningNetworkarticleSE1619

“MedicarePartBClinicalLaboratoryFeeSchedule:GuidancetoLaboratoriesforCollectingandReportingDataforthePrivatePayerRate-BasedPaymentSystem”

(1)ThespecificHCPCScodeassociatedwiththetest;

(2)Theprivatepayerrateforeachtestforwhichfinalpayment hasbeenmadeduringthedatacollectionperiod;and(

3)Theassociatedvolumeforeachtest.


InformationNotApplicable◦ TestcodespaidonlyunderthePFS◦ $0.00(denied)payments◦ Unresolvedappeals◦ Capitatedpayments◦ Paymentswheretheassociatedtestvolumecannotbedetermined


FrequencyforReporting Reportingentitiesarerequiredtoreportapplicableinformation:◦ EverythreeyearsforCDLTs◦ EveryyearforADLTs◦ ExceptforanADLTinitsinitialdatacollectionperiod◦ ReportbytheendofthesecondquarterofthenewADLTinitialperiod

◦ Needtoregisterlaboratoryinordertoprocessinformation


PeriodforDataCollection

 CMSreviseditsproposeddatacollectionperiodfromafullcalendaryearto6months 2016◦ ThedatacollectionperiodwasJanuary1throughJune30,periodprecedingthenextdatareportingperiod.

◦ CMSfinalizeda6-monthperiodoftimebetweentheendofthedatacollectionperiodandthebeginningofthedatareportingperiodtoprovideanopportunityforlaboratoriesandreportingentitiestoreviewandvalidateapplicableinformationtoensurethedataarecompleteandaccuratebeforeitisreportedtoCMS.


PeriodforDataCollection2017◦ ApplicableinformationwillbereportedforadatacollectionperiodbetweentheJanuary1throughMarch31datareportingperiod.

◦ CMScalculatesrates2018◦ NewratesimplementedJanuary1◦ Nowinnextreportingperiod


DataCertification Certificationofaccuracyandcompletenessofapplicableinformationby:◦ President,CEO,orCFOofanapplicablelaboratory◦ Oradirectreporttowhomtheindividualabovehasdelegatedauthority


Penalties ThestatuteauthorizesCMStoimposecivilmonetarypenaltiesof;◦ CMPupto$10,000perdayfor◦ eachfailuretoreportor◦ eachmisrepresentationoromissioninreportingapplicableinformation.◦ AdjustedforinflationasrequiredbytheInflationAdjustmentActImprovementsActof2015


LimitationsforPaymentReductions PAMAlimitsthereductionofthepaymentamountforanexistingtestascomparedtothepaymentamountfortheprecedingyear.◦ Forthefirstthreeyearsafterimplementation,thestatutelimitsthereductionto10percentperyear◦ 2018-2020

◦ Andto15percentperyearforthefollowingthreeyears.◦ 2021-2023

◦ Thephased-inpaymentamountlimitperyearforexistingtestspaidundertheCLFSpriortoJanuary1,2018willbeappliedusingthe2017nationallimitationamount(NLA)fortheexistingtestasthebaselinepaymentamount.

◦ Todeterminetheapplicationofthephased-inpaymentreductionlimitforatest,theweightedmedianprivatepayerratecalculatedforCY2018willbecomparedtotheCY2017NLA.


SoWhatHappened?

PAMAQuestionableAnalysis AccordingtotheCMS:◦ 90percentofthetestpaymentdatacamefromindependentlaboratories◦ Represent5%ofallUSlaboratories

◦ 9percentcamefromphysicianofficelaboratoriesandhospitals,◦ POLsandhospitalsreportedlyrepresentmorethan43percentofMedicarePartBlabpayments.

◦ Servicesusuallyassociatedwithhigherpaymentlevels◦ 1.85percentofdatawascollectedfromlaboratoriesservingruralareas


PAMAQuestionableAnalysis Ofnote:◦ TheSenateAppropriationsCommitteeforwardedareportwithlanguageregardingtheLabor,HealthandHumanServicesfundingbill◦ UrgedCMStoworkwithstakeholderstoensurethatthenewCLFSratesrepresent"thefullspectrumoflaboratories,includinghospital,independent,andphysicianofficelaboratories"


PAMAQuestionableAnalysis Estimate:◦ Overtenyears,thecutsmaytotalasmuchas$13billion,whichismorethanthreetimestheestimateof$3.9billionCongressoriginallyanticipated

◦ LaboratoryIndustryquestioningadequacyofdatagatheredandthus,theaccuracyoftheanalyticprocesstoreportreliableweightedmediansforindividualproceduralcodes


PAMA–WhatHappened? OnSeptember22,2017,theCentersforMedicareandMedicaidServices(CMS)releaseditsproposednewpaymentratesforlaboratorytestsincludedintheCLFS OnNovember17,2017,CMSpublishedthefinaldeterminationsfor2018CLFSpayments◦ TherewouldbenodelayinusingtheFinaldataweightedmedians◦ CodeswithnoNLAwerecappedata10%reduction

 Congressaskedtointercede Suitsanticipated


PAMA&ACLA ThejudgewiththeU.S.DistrictCourtforWashington,DCdismissedACLA’slawsuitthatclaimedtheCLFSchangesunderPAMAwereincorrectlycalculated◦ September21,2018decision◦ Section216ofthePAMAstatuteprohibitsadministrativeorjudicialreviewregardingthesettingofpaymentamounts

◦ Thecourtdoesnothave“subjectmatterjurisdiction”◦ CMS’sdeterminationofpaymentratescannotbechallenged

◦ Additional10%cutsatissueaswellasoriginal2018pricing


ACLAWebsite October19,2018-TheAmericanClinicalLaboratoryAssociation(ACLA)fileditsnoticeofappealinitslawsuitagainsttheU.S.DepartmentofHealthandHumanServices(HHS)challengingitsimplementationoftheProtectingAccesstoMedicareAct(PAMA)◦ “WhiletheDistrictCourtruledonnarrowproceduralgrounds,itsopinionacknowledgesthatACLA’s‘argumentsonthemeritsraiseimportantquestions,’aboutHHS’sactions.WebelieveitiscriticallyimportantforACLAtobeabletoaddresstheseissuesincourt.WhileACLAcontinuestopursuelegalaction,wealsocallonCongresstoreformandmodernizetheClinicalLaboratoryFeeScheduletoensurethatbeneficiariescancontinuetoaccessthelabservicesanddiagnosticstheyneed.”


IndustryResponse ThelaboratorycommunitycalledonCongresstopass"freeze-bridge"legislationtodelaythisnextroundofPAMAcuts.◦ Theproposalwouldfreezethe2018ratesinboth2019and2020allowingtimetodevelopanaccuratemethodologytoimplementPAMA.

◦ Additionally,thesecondroundofdatacollection,scheduledtooccurearlyin2019,wouldalsobedelayeduntilanewmethodologyisinplace.


IndustryResponse Duringthetwo-yearfreezeperiod,CongresswouldrequiretheNationalAcademyofMedicinetoconductastudy◦ Publishrecommendationsonhowtobestimplementtheleastburdensome,statisticallyvaliddatacollectionthatisrepresentativeofthelaboratorymarkets

◦ Establishappropriaterate-settingmethodologythatisrepresentativeofthemarket

◦ Ensuressustainablepatientaccess. ASCLShassetupagrassrootspagetomakeiteasytourgeCongresstotakeaction:www.votervoice.net/ASCLS/campaigns/61741/respond


MPFSFinalRule2018

FinalRule–MPFS November1,2018 CMSannouncedthatitwasincludingMedicareAdvantageProgramservicesinthedefinitionof“applicableLaboratory”underPAMA◦ “..webelievethatmodifyingourdefinitionofapplicablelaboratorysothatwemayreceiveapplicableinformationfrommorelaboratoriesthatfurnishteststoasignificantMedicarePartCpopulation,whicharelesslikelytoqualifyforapplicablelaboratorystatusunderthecurrentpolicy,outweighstheadditionalreportingburdenplacedontheselaboratories”

◦ “..directlysupportsourgoalofcollectingasmuchapplicableinformationaspossiblefromthebroadestrepresentationofthenationallaboratorymarketonwhichtobaseCLFSpaymentamounts”


FinalRule–MPFS CMSannouncedthatitwasincludinghospitaloutreachlaboratoriesinthedefinitionof“applicableLaboratory”underPAMA◦ “..wearefinalizingtherevisionofthedefinitionofapplicablelaboratoryat§414.502toincludeahospitallaboratorythatbillsMedicareontheFormCMS145014xbilltypeanditselectronicequivalent.”


FinalRule–MPFS Impactinquestion◦ MAprograms◦ CMS1450,Billtype14X◦ L1deleted(2016)◦ SeparateNPI◦ IP/OPbundling


NowWhat?

TimeforSecondRoundofReporting 2019◦ ThedatacollectionperiodwillbetheJanuary1throughJune30,periodprecedingthenextdatareportingperiod.

◦ 6-monthperiodoftimetoprovidereviewandvalidateapplicableinformationtoensurethedataarecompleteandaccuratebeforeitisreportedtoCMS.

2020◦ ApplicableinformationwillbereportedbetweenJanuary1andMarch31◦ CMScalculatesrates2021◦ NewratesimplementedJanuary1


GovernmentAccountingOffice(GAO) ArecentNovemberreportrelatedtoPAMAratesforCLFSreimbursementhasraisedanalarmbystatingthat:◦ Maximumpaymentrateswereusedasabaselineratherthanactualpaymentrates◦ NLAcomparisonfor2017payment◦ Projected$733Minincreasedpaymentsin3yr.phase-in

◦ Thepracticeofpayingabundledrateforcertaingroupoftestswaseliminated◦ ATPprocedurecodes◦ ATP02-ATP23◦ Bundledtestsnowhaveseparatepayment◦ Projected$10.3Binincreasedpaymentsin3yrphase-in


SenatorGrassleyCriticismOngoing SenatorCharlesGrassleysensitizedbyreport◦ IowaRepublican◦ ChairofSenateFinanceCommittee◦ SendletterwithquestionstoCMS◦ Believesresponsewasinadequate◦ Requestsraterevision


LaboratoryPush-Back AccusesGAOofmakingflawedanddangerousassertionsbasedonaseriousmisunderstandingofrealworldbillingpractices◦ Projectionsoverblown◦ Laboratorieshavenotchangedbillingpractices


ACLALawsuitAppeal February25◦ TheDepartmentofHealthandHumanServices(HHS)fileditsresponsetoACLA’sappealofitslawsuit

◦ ACLAhasarguedthatHHSimproperlyimplementedtheProtectingAccesstoMedicareActof2014(PAMA)byexcludingprivate-payerdatafromnearlyallhospitaloutreachlabswhenCMSderivednewratesfor2018

◦ HHSdisagreedwithACLA’sstanceandnotedthatthePAMAlawbarsany“administrativeorjudicialreview”tothe“establishmentofpaymentamounts”inthenewprivate-payer-rate-basedCLFS.


ACLALawsuitAppealHHSBriefcontinued:◦ “Inshort,plaintiffseekshigherpaymentamountsthroughanattackontheSecretary’sdefinitionof‘applicablelaboratory.’Howeverframed,thatchallengetothepaymentamountsisbarredbytheplaintextofthestatute,”

◦ OralargumentsfortheappealarescheduledtotakeplaceonApril23,andadecisionbytheU.S.CourtofAppealsfortheDistrictofColumbiaCircuitwillbeissued


HospitalIssues

DiligenceRequired◦ Determineifandwhoare“ApplicableLaboratories”◦ DevelopaPAMAteam◦ Registerwithvendorcollectingdata◦ AssessITsystemsandcapabilities◦ AcquireneededITsoftwareandresources◦ Gainappropriateadviceandtipsforprocess.◦  Collect“applicableinformation”◦ Massagedatatoensureitiscompleteandaccurate◦ Demonstratecompliancewithlaw◦ Reportdatainrequiredformat◦  Staytuned


Discussion


Thankyouforyourcourtesy!

 

  Diana

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