The Protecting Access to Medicare Act (PAMA) was passed on April 1, 2014 to reform the Clinical Laboratory Fee Schedule (CLFS). As a result, CLFS will see multiple cuts over a six year time period beginning in 2018. The cuts are up to 10% per year for the first three years, then up to 15% per year for the following three years. The initial round of data collection excluded most hospital outreach labs, and the 2018 CLFS was established primarily on independent laboratory payment rates. For the next reporting period, the definition of applicable laboratory has been expanded and will include many more hospital outreach labs.
It is mandatory that all applicable labs report the appropriate information. The data collection period is open now from January 1 to June 30, 2019. The following steps are a guide to help you determine if your lab is applicable and how to report the correct information:
Determine Laboratory Applicability
There are important
reporting standards to consider when determining applicability.
- From Jan-Jun 2019 will you bill Medicare for lab testing to be reimbursed by the CLFS?
- Do you bill on your own National Provided Identification (NPI), a hospital NPI, or (1450) 14X type of bill?
- Did you bill for more than $12,500?
If the answer to these questions is yes, you may have to report your private payor revenue to CMS.
Next, determine if you are an applicable lab:
- For Jan-Jun 2019, total your CLFS and Physician Fee Schedule (PFS) revenues.
- For Jan-Jun 2019, total all CMS (Medicare A, B, D) revenues
CLFS Revenues + PFS Revenues >50%
Total Medicare Revenues (A, B, D)
If you exceed 50%, you are an applicable lab and must report.
Collection and Reporting Dates
The data collection period is now open (January 1, 2019 through June 30, 2019). All labs that are applicable should report during the next data reporting period (January 1, 2020 through March 31, 2020).
Collect the data
It’s important to capture the correct information. All applicable information should include the procedure code specific to each test, the rate at which private payors allow for each test, and the volume for each private payor rate. The rates must include the amount covered by the patient and after all price considerations are applied. This information should include Medicare Advantage, Medicaid managed care, health insurance issuers, and group health plans.
The CMS website has a reporting template available. You may find it at the bottom of the webpage here.
Failure to report will result in a penalty of $10,000 per day, per instance.
CMS PAMA Website:
Medicare Learning Network Resources:
Frequently Asked Questions
Byline: Caitlin Summers is an Outreach Solutions Strategist for Mayo Clinic Laboratories.