Thursday, April 29, 2021

CMS Updates Some PAMA Lab Pricing Reporting Guidelines

Section 216 of the PAMA law of 2014 requires labs to report private payor pricing every 3 years to CMS, which CMS then uses to set a triennial Medicare lab fee schedule.  

The first cycle involved a claims period in 1H2016, reporting in 1Q2017, CMS publications in September 2017, and a 3-year fee schedule for 2018, 2019, 2020.   Due to some quirks and updates to PAMA law, the next three year cycle is atypical.  The claims period is still 1H2019, but data will be reported in 1Q2022 (not 1Q2020), for price publication in September 2022 and a fee schedule for 2023, 2024, 2025.

On April 20, 2021, CMS updated some documents on its website for PAMA lab pricing policy.   

  • The main webpage is here.
  • At least two documents have been updated:
  • Summary of Private-Payor Rate-Based CLFS, 10 page PDF, here.
  • FAQ, 14 page PDF, here.
While these two PDFs show new dates of April 20, 2021, there isn't any guide to new information.  I can't tell easily if they've merely updated dates (per legislative changes) or if they've updated definitions or instructions in a material way.  [Note, I found a 2017 FAQ online, but that version was much longer at 18 pages, so probably too different to benefit from a redline.]

The regulations upon which the guidelines and FAQs are based are found at 42 CFR 414.500ff, here.

By request of Congress, MedPAC is preparing a report on CMS and PAMA rules, with a public preview in April 2021 and final public report in June 2021.   CMS summer rulemaking might make some changes to PAMA rules which would take effect on January 1, 2022, in time for the 1Q2022 reporting period.


What Will Happen to Codes Newer than the 2019 Claims Period?

Several hundred lab codes (mostly PLA codes) will have been produced between the closure of the 2019 PAMA claims period and the 2023 fee schedule.  In the last PAMA pricing period, all lab tests that didn't have PAMA payor data (from claims in 1H2016) were crosswalked or gapfilled in August 2017 (about 100 codes) to produce prices for the 2018 fee schedule.

One reading of PAMA regulations at 42 CFR 414.508 is that new codes get crosswalked or gapfilled in 2018, 2019, 2020, 2021, but only those with payment data from 1H2019 will get repriced via PAMA in fall 2022 for CY2023.  Other codes (such as a code new in 2H2019 or 1H2020) will stay at their same price indefinitely, until they do get PAMA data (perhaps in 1H2024).  

Another reading of 414.508 is that codes without PAMA data get priced by the method in 414.507, which states that codes without PAMA data get crosswalked or gapfilled for the next 3-year schedule (e.g. 507 sends codes without new PAMA data right back to method 508, which is "CW/GF" pricing).  

I think the simplest reading of 414.508 is that codes crosswalked in 2020 or 2021 stay at that price, and that CMS responds to their lack for 2019 PAMA data as meaning they are set aside until the next PAMA cycle when they do have PAMA data.  But it's a bit of a brain teaser, semantically, as 414.507 and 414.508 point back and forth at each other like two mirrors facing each other.  

In addition, most codes are crosswalked, and a 2020 code crosswalked to a code WITH 2019 PAMA data, could be repriced in 2023 because its CW reference, the code with 2019 PAMA data, is being repriced for CY2023.*

Nerd note.  A person can redline two PDFs in a business version of Adobe Acrobat, but it's kind of expensive software.  If you google "redline 2 PDFs" you'll get some cloud websites that allow the redline action between two PDFs.  E.g.   

* Let's say Code 01U is priced at $100 in 2018, and gets new PAMA data in 2019, repricing it at $80.  This repricing will occur in 2023, due to the extended PAMA schedule we are in.  

Code 02U is new in 2020, and crosswalked to 01U at $100.   I believe in 2023, even though 02U has "no data" from any 2019 survey, its price will fall to $80 because its referent crosswalk (01U) is changing.  In my experience, CMS has always viewed crosswalks as "living" crosswalks, subject to change if the crosswalk target code changes.  You can't necessarily read this lability from the wording of the 414.508 regulations, but it's the way CMS has behaved.