Clinical laboratories and hospitals should note the potential changes to the Protecting Access to Medicare Act of 2014 (“PAMA”) reporting requirements tucked into the 1,400 page Physician Fee Schedule Proposed Rule (the “Proposed Rule”) released by CMS earlier this month. If finalized, these proposals would likely expand the number of laboratories, including hospital laboratories, subject to PAMA’s reporting requirements and may ultimately impact the rates paid under the Medicare Clinical Laboratory Fee Schedule (“MCLFS”).

As discussed in a previous post, PAMA made sweeping changes to the rate-setting process under the MCLFS. PAMA and its implementing regulations require “applicable laboratories” to report the private payor rates they receive for laboratory tests during specific data collection periods, and those rates then determine the rates paid under the MCLFS. Continue Reading Potential Changes to PAMA Reporting in Medicare Physician Fee Schedule Rule

Expanding on our recent blog post discussing CMS’s final rule (the “Final Rule”) implementing portions of the Protecting Access to Medicare Act of 2014 related to clinical laboratories, my colleague Karen Lovitch and I published an article in BNA’s Medicare Report entitled CMS Regulations Overhaul Medicare Clinical Laboratory Fee ScheduleThe article discusses the reporting obligations of clinical laboratories, the impact of the Final Rule on reimbursement for clinical laboratory tests, and areas in which laboratories should expect further sub-regulatory guidance from CMS.

Building on last year’s public workshops related to Next-Generation Sequencing (NGS) and expanding its efforts to advance the Obama Administration’s Precision Medicine Initiative, late last week, FDA released two draft guidance documents on different aspects of NGS-based diagnostic tests.  NGS is a term used to describe new technologies that allow rapid sequencing of large segments of an individual’s DNA or entire genomes, as we have described previously.  The Agency’s stated goal is “to create a flexible and adaptive regulatory approach to the oversight of NGS-based tests,” given the rapid and innovative advancements being made in the technologies.

Of the two new policies, the first draft guidance describes an approach to allow test developers to rely on clinical evidence from FDA-recognized public genome databases to support claims for their tests and to provide assurance of accurate clinical interpretation of genomic test results, potentially offering a streamlined path to approval. The second document provides recommendations for designing, developing and validating NGS-based tests for rare hereditary diseases and addresses the potential for using FDA-recognized standards to show analytical validity. For a more in-depth look at each guidance document, please see our full client alert. Continue Reading FDA Comes Through on Promise to Release NGS Device Draft Guidelines Expeditiously

Testtubes_143897611Last Friday afternoon CMS released its eagerly anticipated final rule (the Final Rule) implementing the Protecting Access to Medicare Act of 2014 (PAMA), which, together with the Final Rule, will make sweeping changes to the rate-setting process under the Medicare Clinical Laboratory Fee Schedule (MCLFS).  According to CMS estimates, Medicare Part B payments for clinical diagnostic laboratory tests (CDLTs) will decrease by $390 million in fiscal year 2018 when the repricing will take effect.  The Final Rule comes nearly nine months after CMS issued its proposed rule (the Proposed Rule) and long after PAMA’s statutory deadline.  Our previous coverage of the Proposed Rule is available here, here, and here. Continue Reading At Long Last, CMS Issues Final Rule for Lab Fee Schedule Changes

Over the past year, significant regulatory changes began to take shape that will have lasting effects on the laboratory industry for years to come. After publishing draft guidance regarding the regulation of laboratory developed tests (LDTs) in late 2014, the Food and Drug Administration (FDA) made clear in 2015 that it intends to move forward with its proposal next year, and the Centers for Medicare & Medicaid Services (CMS) published a proposed rule outlining the process for overhauling the Medicare Clinical Laboratory Fee Schedule (MCLFS) for the first time in over 20 years. In addition, laboratories faced more than their fair share of enforcement actions and other litigation, and this level of activity is likely to continue in 2016. Continue Reading Laboratories – 2015 Year in Review [VIDEO]

Last Tuesday, Dr. Jeffrey Shuren, director of the Food and Drug Administration’s Center for Devices and Radiological Health, announced at a hearing before the House Energy and Commerce Committee’s Subcommittee on Health that FDA would move forward with finalizing its plan to regulate laboratory developed tests (LDTs) sometime in 2016.  FDA provided notice of its intent to take action on LDTs when it published a draft guidance document in October 2014, setting forth the agency’s plan for regulatory oversight of LDTs. FDA’s decision to regulate LDTs would be a significant policy shift in this area because, historically, the agency has chosen not to exercise its enforcement power over LDTs.  FDA cites the increased complexity and higher patient risks involved with more modern LDTs as the impetus for its decision. Despite pushback from clinical laboratories and some other stakeholders, Shuren’s statements during Tuesday’s House hearing demonstrate that the agency is committed to finalizing and implementing a new regulatory framework for LDTs.

FDA’s draft guidance defines an LDT as a type of in vitro diagnostic (IVD), which is a test that detects a disease, condition, or infection. LDTs are IVDs that are developed and used within a single laboratory and intended for clinical use. Continue Reading FDA Commits to Moving Forward with LDT Regulation

The Fiscal Year 2015 budget for the Commonwealth of Massachusetts, which was signed into law earlier in the week, included a broad prohibition on clinical laboratory self-referrals.  This legislation (the “Bill”) originally proposed by the Attorney General’s office was intended to combat self-referral arrangements between clinical laboratories and sober houses under common ownership, but it extends beyond such relationships to prohibit referrals between clinical laboratories and any person or company with a direct or indirect ownership interest in the laboratory and vice versa (with a number of notable exceptions). Continue Reading New Massachusetts Law Targets Self-Referrals of Clinical Laboratory Services