September 12, 2016

New Regulations Will Decimate the Market for Clinical Laboratory Testing Services

The Hill

Former U.S. Congressman Dr. Phil Gingrey and Senior Advisor to the District Policy Group at Drinker Biddle has published a column in The Hill on a final regulation issued by the Centers for Medicare and Medicaid Services (CMS), which threatens to eliminate competition in the clinical laboratory market across the country.

Dr. Gingrey explains that this final regulation is in response to legislation included in the Protecting Access to Medicare Act (PAMA) of 2014, which was passed to avert cuts in Medicare physician pay due to the flawed sustainable growth rate formula (SGR). PAMA otherwise did not pertain to clinical laboratory services.

His piece explains that small community and mid-size regional independent laboratories that serve physician practices, hospitals, outpatient care settings, skilled nursing and rehabilitation institutions, and long-term care facilities are the entities most negatively impacted by the new regulation. These laboratories employ a skilled scientific workforce right in the community, providing timely, needed diagnostic testing services to Medicare beneficiaries in rural and other underserved communities.

Dr. Gingrey notes that with fewer laboratory facilities to process samples, doctors and patients will experience a delay in test results and therefore treatment. “The situation is reminiscent of the way mom and pop shops have felt the squeeze from big box retailers in the past 20 years. But instead of someone traveling further away to buy milk because the grocery store in a rural community has closed, we’re talking about a Medicare patient traveling hours for a critically important lab test because there are no more local labs to perform that service.”

Click here to read Phil’s full column in The Hill.
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