Medicare Laboratory Payment Policy Now and in the Future (2000) / Chapter Skim
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7 Recommendations
7 Recommendations
Pages 144-162
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From page 144... ...
They do not, however, reflect a conclusion about whether current Medicare aggregate payments or the payment for a particular test is too high or too low. The final six recommendations focus on problems in the current system.
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From page 146... ...
and its contractors. A national fee schedule allows the establishment of a single set of payments for all outpatient clinical laboratory services, adjustments for differences in local labor costs and prices for goods and services the laboratory purchases, and if appropriate, other relevant factors.
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From page 147... ...
As a result, the committee makes specific additional recommendations about how to move quickly to a national fee schedule and then develop a process for refining and improving it that balances potential improvements against additional development costs. RECOMMENDATION 2: On an interim basis, relative payments for Medicare outpatient clinical laboratory services should be based on the current National Limitation Amounts (NLAs)
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From page 148... ...
If those studies suggest that a markedly larger reduction in the NLAs would be needed if the Congress were to call for maintaining budget neutrality, the committee suggests that the new fee schedule be phased in over two or more years, to minimize disruptions experienced by beneficiaries and clinical laboratories. RECOMMENDATION 3: A data-driven consensus process for refining the new Medicare national fee schedule for outpatient clinical laboratory services should be developed.
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From page 149... ...
Unless care is taken in its design, however, it is vulnerable to criticisms about the process for identifying participants, the method for combining information from different sources, and the possible impropriety of using subjective, qualitative methods to measure what some think should be readily quantifiable. If the focus of the refinement effort is the actual fees rather than their relative values, this method would have to include budget constraints or it could be inflationary.
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From page 150... ...
RECOMMENDATION 4: Medicare national fees for outpatient clinical laboratory services should be adjusted for geographic location. HCFA should also evaluate the need to adjust for certain other circumstances, particularly those likely to affect beneficiary access, and make recommendations to the Congress.
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From page 151... ...
The committee has discussed a number of provider, test, and beneficiary characteristics that may be associated with cost differences and should be reflected in Medicare payments. It is most concerned with situations in which lack of adjustment to national fees is likely to affect beneficiaries' ability to obtain needed services.
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From page 152... ...
Since laboratory service volume growth is already included in the sustainable growth rate (SGRJ process used to calculate updates to physician payment rates, reflecting the role physicians play in ordering the tests performed by laboratories, it should not play a role in updating laboratory payments.s . Payment adjustments: Review and revision of geographic and other payment adjustments should include analyses of their effect on beneficiary access to laboratory services.
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From page 153... ...
The committee has concluded that a consistent, public process for developing interim values for new laboratory services is essential for an effective payment system. Such a process could improve current methods used to establish payment rates for new services and address many of the concerns stakeholders have about current policy.
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From page 154... ...
RECOMMENDATION 8: The current policy of not requiring beneficiary cost sharing for Medicare outpatient clinical laboratory services should continue. Cost sharing is unlikely to significantly reduce overuse or increase the detection of fraud and abuse; it could create barriers to access for the most vulnerable Medicare beneficiaries; and it would be financially and administratively burdensome for laboratories, patients, and the Medicare program depending on its design.
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From page 155... ...
For laboratory services, however, the patient does not initiate this use, usually has no contact with the laboratory, often has supplemental insurance that mutes the cost impact, and is unlikely to challenge the physician's order. The medical literature is replete with examples of overuse of laboratory tests in the inpatient hospital setting (Axt-Adam et al., 1993; Hindmarsh and Lyon, 1996; van Walraven and Naylor, 1998~.
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From page 156... ...
Although it may be a reasonable business decision to forgo the copayment in many cases, laboratories would risk charges of billing fraud if they failed to make an effort to collect these payments.7 RECOMMENDATION 9: HCFA should discontinue use of International Classification of Diseases, Ninth Revision (ICD-9) diagnosis codes as the basis for determining the medical necessity of clinical laboratory tests.
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From page 157... ...
As a prudent buyer, HCFA should examine a number of other approaches for promoting clinically appropriate use of laboratory tests including the following: . inclusion of outpatient clinical laboratory tests in the peer review organizations' (PROs')
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From page 158... ...
The committee recommends that HCFA develop a method for accomplishing this to ensure that laboratories, referring physicians, and beneficiaries have easier access to information about the laws, policies, and procedures that affect their ability to provide and receive clinical laboratory services and receive payment for them. RECOMMENDATION 11: HCFA should move promptly to consolidate the number of contractors processing all Medicare outpatient clinical laboratory claims, including claims from physician office laboratories (POLs)
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From page 159... ...
RECOMMENDATION 12: HCFA should collect the data needed to effectively manage the performance of the Medicare outpatient clinical laboratory payment system. HCFA should collect baseline data to inform future policy considerations and additional data to measure the impact of policies, particularly on beneficiary access to care and on the diffusion of new technologies.
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From page 160... ...
Over time, this could change the availability of laboratory services for Medicare beneficiaries. To learn more about these potential access problems and to evaluate the impact of future payment policy changes, the committee recommends that HCFA use existing data sources, such as Clinical Laboratory Improvement Amendments (CLIA)
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From page 161... ...
1993. Influencing behavior of physicians ordering laboratory tests: A literature study.
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