PAMA Update: How Applicable Labs Submit Data
This June, the Centers for Medicare & Medicaid Services (CMS) published the final Protecting Access to Medicare Act of 2014 (PAMA) rule, which mandates that applicable labs report their private payer reimbursements for tests performed on the Clinical Laboratory Fee Schedule (CLFS). This data will then be used to develop future Medicare reimbursements for laboratory testing.
A Quick PAMA Review
Details of the final PAMA rule were outlined in a previous blog post: The Final PAMA Rule: Transitioning Labs from Fee-for-Service to a Value-based Business Model. Below is a review of the highlights:
- The future CLFS will be calculated using the weighted median of private insurance payments to applicable laboratories
- An applicable laboratory is any CLIA laboratory that receives more than 50% of its Medicare revenue from the Physician Fee Schedule or CLFS with annual Medicare payments of more than $12,500, calculated at the National Provider Identifier (NPI) level
- The implementation date for the new CLFS is January 1, 2018
- There will be one nationwide fee schedule
- Reporting incudes data from all private payers including: group health plans, Medicare Advantage, and Medicaid MCO plans
- Data that must be reported are: CPT codes, test volumes, and each private payer’s rate
- CMS is predicting cost savings of nearly $5 billion over ten years
Applicable labs must report data from the period of January 1, 2017 through March 31, 2017, and then every three years thereafter. Advanced Diagnostic Laboratory Tests (ADLTs) follow different rules and should be initially reported at third quarter end and annually thereafter.
Applicable laboratories must register with CMS via the enterprise portal to obtain a user name and password. After successfully registering, users must select Fee-for-Service Data Collection System (FFSDCS) as the system description and choose either the role of CLFS Submitter or CLFS Certifier. After role submission, an email will verify registration approval within 72 hours.
Data may be submitted via .csv file (uploaded via Excel or text file), or by manual entry. It is unlikely that many labs will use the manual entry option for large amounts of data. Once the data is entered, the CLFS Data Certifier must log in and verify the accuracy of the data. However, the certifier cannot edit the data; only the submitter can make corrections. After data certification, the lab will no longer be able to access the data.
For more details on the data submission process for applicable labs, review the links below.
- Instructions on how to report from the Medicare Learning Network: www.cms.gov/Outreach-and-Education/Outreach/NPC/Downloads/2016-11-02-Clinical-Lab-Presentation.pdf
- CMS Enterprise Portal: portal.cms.gov/wps/portal/unauthportal/home/
- Fee-For-Service Data Collection System: Clinical Laboratory Fee Schedule Data Reporting Template: www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE1620.pdf
- Frequently Asked Questions: Medicare Program–Medicare Clinical Diagnostic Laboratory Tests Payment System Final Rule: www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ClinicalLabFeeSched/Downloads/CMS-1621-F-FAQ.pdf
CMS will use the submitted data to calculate the weighted median price for each code; that will be the new CLFS reimbursement. The new pricing will be in effect for three years (with the exception of ADLTs). If no data is received for a CPT code, CMS will use crosswalking or gap filling to price the test.
CMS estimates a $390 million reduction in FY2018 payments because they believe that private payer rates are approximately 20% lower than Medicare. Even if your lab does not qualify as applicable for reporting, this new pricing will affect your lab. Therefore, it would be prudent to plan and budget accordingly for the next few years based on reduced reimbursements.
PAMA also includes penalties for applicable labs that fail to report. CMS is authorized to impose civil monetary penalties of up to $10,000 per day (adjusted for inflation) for each failure to report or each misrepresentation or omission in reporting of information.
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Kim Futrell, BS, MT(ASCP)
Products Marketing Manager
Orchard Software Corporation