Medpac Mandated report released: Assessing the impact of recent changes to Medicare’s clinical laboratory fee schedule payment rates

The Further Consolidated Appropriations Act of 2020 mandated that the Commission examine the methodology CMS used to set private-payer-based payment rates for CLFS services and report on the least burdensome data collection process that would result in a representative and statistically valid data sample of private market rates.  In this chapter, the Commission finds that independent laboratories were overrepresented in the data collected by CMS, and hospital and physician-office laboratories were underrepresented. They also found that using private-payer data using a survey could reduce the number of labs required to report data to CMS and could produce a more representative distribution of all laboratories in the data.  However, despite being technically feasible, incorporating private-payer rates from a representative sample of all types of laboratories may not be prudent given the trajectory of private-payer prices for new high-tech laboratory tests.