What This Bill Does
This bill changes how Medicare pays for lab tests. Instead of collecting detailed payment information from every lab, Medicare can now collect this information from a smaller sample of labs for common tests. The bill also adjusts when Medicare can reduce or increase payments to labs for these services.
##
Who It Affects
- Laboratory businesses that perform clinical diagnostic tests (a medical test using body samples to diagnose disease)
- Medicare (the federal health insurance program for seniors and certain disabled people)
- Private insurance companies that pay labs
- The Department of Health and Human Services
##
Key Provisions
- For common lab tests starting in 2026, the government can collect payment data from a representative sample of labs instead of requiring all labs to report the same information. (Sec. 2(a)(1))
- The Secretary of Health and Human Services must develop a sampling method that includes different types of labs including independent labs, hospital labs, hospital outreach labs, and physician office labs. (Sec. 2(a)(1))
- Labs that earn at least $12,500 in Medicare payments during the first 6 months of the year before the data collection period count as "applicable laboratories" that may need to report information. (Sec. 2(b))
- Labs that make less than 10 percent of their insurance payments through non-electronic methods can exclude those non-electronic payments from their reported information. (Sec. 2(c)(2))
- The government must publish a list of common lab tests by September 30 each year and notify labs that need to report information. (Sec. 2(a)(1))
- Payment increases for common lab tests are limited to 2.5 percent in 2024 and 2025, 3.75 percent in 2026 and 2027, and 5 percent for 2028 and beyond. Other lab tests can increase up to 5 percent annually. (Sec. 2(d)(2))
- Starting in 2024, payment reductions cannot exceed 0 percent that year, then 2.5 percent in 2025, then 5 percent in 2026 and after. (Sec. 2(d)(1))
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What Changes
The law delays when new data collection must begin from 2024 to 2027. Labs no longer need to report data every three years but instead every four years. Medicare stops using a test that measured whether labs earned most of their revenue from Medicare. Instead of collecting complete information from all labs, Medicare can now use sampling methods for widely available tests. Labs face new caps on how much their Medicare payments can increase each year. Medicaid managed care organization payment information requirements end for data periods starting in 2027 and later.
##
Important Definitions
- "Widely available clinical diagnostic laboratory test": A test that costs less than $1,000 per test and is performed by more than 100 labs. (Sec. 2(a)(1))
- "Applicable laboratory": A lab that receives at least $12,500 in Medicare payments during the first 6 months of the year before the data collection period. (Sec. 2(b))
- "Applicable information": Not specified in bill text
- "Electronic standard transaction": As defined in federal regulations at title 45, Code of Federal Regulations, section 162.103. (Sec. 2(c)(2))
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Effective Date
The bill requires the Secretary to develop the sampling methodology and implement most changes by December 31, 2024. The new sampling approach begins for data collection periods starting January 1, 2026. The new payment increase caps take effect in 2024.
I
118TH CONGRESS
1ST SESSION H. R. 1835
To amend title XVIII of the Social Security Act to improve the accuracy
of market-based Medicare payment for clinical diagnostic laboratory serv-
ices, to reduce administrative burdens in the collection of data, and
for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 28, 2023
Mr. HUDSON (for himself and Mr. BUCSHON) introduced the following bill;
which was referred to the Committee on Energy and Commerce, and in
addition to the Committee on Ways and Means, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend title XVIII of the Social Security Act to improve
the accuracy of market-based Medicare payment for clin-
ical diagnostic laboratory services, to reduce administra-
tive burdens in the collection of data, and for other
purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘Saving Access to Lab-
4
oratory Services Act’’.
5
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•HR 1835 IH
SEC. 2. MODIFICATION OF REQUIREMENTS FOR MEDICARE
1
CLINICAL DIAGNOSTIC LABORATORY TESTS.
2
(a) USE OF STATISTICAL SAMPLING FOR WIDELY
3
AVAILABLE
CLINICAL
DIAGNOSTIC
LABORATORY
4
TESTS.—
5
(1) IN GENERAL.—Section 1834A(a)(1) of the
6
Social Security Act (42 U.S.C. 1395m–1(a)(1)) is
7
amended—
8
(A) in subparagraph (A), by striking ‘‘Sub-
9
ject to subparagraph (B)’’ and inserting ‘‘Sub-
10
ject to subparagraphs (B) and (C)’’; and
11
(B) by adding at the end the following new
12
subparagraph:
13
‘‘(C) USE OF STATISTICAL SAMPLING FOR
14
WIDELY AVAILABLE CLINICAL DIAGNOSTIC LAB-
15
ORATORY TESTS.—
16
‘‘(i) IN GENERAL.—Subject to clause
17
(ii), with respect to data collection periods
18
for reporting periods beginning on or after
19
January 1, 2026, in the case of a widely
20
available clinical diagnostic laboratory test
21
(as defined in clause (iii)), in lieu of re-
22
quiring the reporting of applicable infor-
23
mation from each applicable laboratory,
24
the Secretary shall require the collection
25
and reporting of applicable information
26
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•HR 1835 IH
from a statistically valid sample of applica-
1
ble laboratories for each such widely avail-
2
able clinical diagnostic laboratory test.
3
‘‘(ii) REQUIREMENTS
FOR
STATIS-
4
TICAL SAMPLING.—
5
‘‘(I) IN
GENERAL.—The Sec-
6
retary, in consultation with stake-
7
holders, shall develop a methodology
8
for a statistically valid sample under
9
clause (i), using the maximal brewer
10
selection method, as described in the
11
June 2021 Medicare Payment Access
12
Commission Report to the Congress,
13
to establish the payment amount for a
14
widely available clinical diagnostic lab-
15
oratory test under paragraph (2) of
16
subsection (b) for each applicable
17
HCPCS code for a widely available
18
clinical diagnostic laboratory test.
19
‘‘(II)
REPRESENTATIVE
SAM-
20
PLING.—The methodology under sub-
21
clause (I) for a statistically valid sam-
22
ple under clause (i) shall, for each ap-
23
plicable HCPCS code for a widely
24
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•HR 1835 IH
available clinical diagnostic laboratory
1
test—
2
‘‘(aa) provide for a sample
3
that allows for the payment
4
amounts established under para-
5
graph (2) of subsection (b) for
6
such a test to be representative
7
of rates paid by private payors to
8
applicable laboratories receiving
9
payment under this section, in-
10
cluding independent laboratories,
11
hospital
laboratories,
hospital
12
outreach laboratories, and physi-
13
cian office laboratories that fur-
14
nish the widely available clinical
15
diagnostic laboratory test;
16
‘‘(bb) include applicable in-
17
formation (as defined in para-
18
graph (3)) with respect to such
19
widely available clinical diag-
20
nostic laboratory test from such
21
different types of applicable lab-
22
oratories; and
23
‘‘(cc) be of sufficient size to
24
accurately
and
proportionally
25
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•HR 1835 IH
represent the range of private
1
payor payment rates received by
2
each such type of applicable lab-
3
oratory weighted according to the
4
utilization rates of each type of
5
applicable
laboratory
for
the
6
widely available clinical diag-
7
nostic laboratory test during the
8
first 6 months of the calendar
9
year immediately preceding the
10
data collection period applicable
11
to the sample to be collected.
12
‘‘(III) LEAST BURDENSOME DATA
13
COLLECTION
AND
REPORTING
PROC-
14
ESSES.—The methodology developed
15
by the Secretary shall be designed to
16
reduce administrative burdens of data
17
collection and reporting on applicable
18
laboratories and the Centers for Medi-
19
care & Medicaid Services to the great-
20
est extent practicable.
21
‘‘(IV) PUBLICATION OF LIST OF
22
WIDELY
AVAILABLE
CLINICAL
DIAG-
23
NOSTIC LABORATORY TESTS AND NO-
24
TIFICATION TO APPLICABLE LABORA-
25
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•HR 1835 IH
TORIES REQUIRED TO REPORT APPLI-
1
CABLE INFORMATION.—Not later than
2
September 30 of the year immediately
3
preceding each data collection period
4
(as defined in paragraph (4)), the
5
Secretary shall publish in the Federal
6
Register a list of widely available clin-
7
ical diagnostic laboratory tests and
8
shall directly notify applicable labora-
9
tories required to report applicable in-
10
formation under this subsection.
11
‘‘(iii) DEFINITION OF WIDELY AVAIL-
12
ABLE CLINICAL DIAGNOSTIC LABORATORY
13
TEST.—In this subparagraph, the term
14
‘widely available clinical diagnostic labora-
15
tory test’ means a clinical diagnostic lab-
16
oratory test that meets both of the fol-
17
lowing criteria during the first 6 months of
18
the calendar year immediately preceding
19
the data collection period applicable to the
20
sample to be collected:
21
‘‘(I) PAYMENT RATE.—The pay-
22
ment amount determined for the clin-
23
ical diagnostic laboratory test under
24
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•HR 1835 IH
this section is less than $1,000 per
1
test.
2
‘‘(II) NUMBER OF LABORATORIES
3
PERFORMING THE TEST.—The num-
4
ber of applicable laboratories receiving
5
payments under this section for the
6
clinical diagnostic laboratory test (as
7
determined by the Secretary using the
8
national provider identifier of the pro-
9
vider of services or supplier on the
10
claim submitted for payment under
11
this part for such test) exceeds 100.’’.
12
(2) DELAYS TO REVISED REPORTING PERIODS
13
AND REPORTING PERIOD FREQUENCY.—
14
(A)
IN
GENERAL.—Section
15
1834A(a)(1)(B) of the Social Security Act (42
16
U.S.C. 1395m–1(a)(1)(B)) is amended—
17
(i) in clause (i), by striking ‘‘Decem-
18
ber 31, 2023’’ and inserting ‘‘December
19
31, 2026’’;
20
(ii) in clause (ii), by striking ‘‘begin-
21
ning January 1, 2024, and ending March
22
31, 2024’’ and inserting ‘‘beginning Janu-
23
ary 1, 2027, and ending March 31, 2027’’;
24
and
25
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•HR 1835 IH
(iii) in clause (iii) by striking ‘‘every
1
three years’’ and inserting ‘‘every four
2
years’’.
3
(B) CONFORMING CHANGE TO DEFINITION
4
OF
DATA
COLLECTION
PERIOD.—Section
5
1834A(a)(4)(B) of the Social Security Act (42
6
U.S.C. 1395m–1(a)(4)(B)) is amended by strik-
7
ing ‘‘January 1, 2019, and ending June 30,
8
2019’’ and inserting ‘‘January 1, 2026, and
9
ending June 30, 2026’’.
10
(b) ELIMINATION OF MAJORITY OF MEDICARE REVE-
11
NUES TEST.—The first sentence of section 1834A(a)(2)
12
of the Social Security Act (42 U.S.C. 1395m–1(a)(2)) is
13
amended by striking ‘‘In this section’’ and all that follows
14
through the period and inserting the following: ‘‘Notwith-
15
standing determinations of applicable laboratories made
16
prior to January 1, 2025, the term ‘applicable laboratory’
17
means a laboratory that receives at least $12,500 in pay-
18
ments under this section during the first 6 months of the
19
calendar year immediately preceding the applicable data
20
collection period.’’.
21
(c) MODIFICATIONS TO APPLICABLE INFORMATION
22
REPORTED.—
23
(1) MEDICAID MANAGED CARE RATES.—Section
24
1834A(a)(8)(C) of the Social Security Act (42
25
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•HR 1835 IH
U.S.C. 1395m–1(a)(8)(C)) is amended by striking
1
‘‘A medicaid managed care organization’’ and insert-
2
ing ‘‘With respect to data collection periods for re-
3
porting periods beginning before January 1, 2027, a
4
medicaid managed care organization (as defined in
5
section 1903(m))’’.
6
(2) AUTHORITY TO EXCLUDE MANUAL REMIT-
7
TANCES.—Section 1834A(a)(3) of the Social Secu-
8
rity Act (42 U.S.C. 1395m–1(a)(3)) is amended—
9
(A) in subparagraph (A), by striking ‘‘sub-
10
ject to subparagraph (B),’’ and inserting ‘‘sub-
11
ject to subparagraphs (B) and (C)’’; and
12
(B) by adding at the end the following new
13
subparagraph:
14
‘‘(C) EXCLUSION
OF
MANUAL
REMIT-
15
TANCES.—An applicable laboratory for which
16
less than 10 percent of its total paid claims
17
during a data collection period are paid by pri-
18
vate payors by means other than an electronic
19
standard transaction (as defined in section
20
162.103 of title 45, Code of Federal Regula-
21
tions (or any successor regulation)) may exclude
22
from the definition of applicable information
23
under this paragraph payments made by private
24
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•HR 1835 IH
payors that are not made through an electronic
1
standard transaction.’’.
2
(d) MODIFICATION TO LIMITS ON PAYMENT REDUC-
3
TIONS; IMPOSITION OF ANNUAL CAP ON PAYMENT IN-
4
CREASES.—
5
(1) PAYMENT
REDUCTION
LIMITS.—Section
6
1834A(b)(3) of the Social Security Act (42 U.S.C.
7
1395m–1(b)(3)) is amended—
8
(A) in subparagraph (A), by striking ‘‘for
9
each of 2017 through 2026’’ and inserting ‘‘for
10
2017 and each succeeding year’’; and
11
(B) in subparagraph (B)—
12
(i) in clause (ii), by striking ‘‘and’’ at
13
the end; and
14
(ii) by striking clause (iii) and insert-
15
ing the following:
16
‘‘(iii) for 2024, 0 percent;
17
‘‘(iv) for 2025, 2.5 percent; and
18
‘‘(v) for 2026 and each subsequent
19
year, 5 percent.’’.
20
(2) ANNUAL
CAP
ON
PAYMENT
RATE
IN-
21
CREASES.—Section 1834A(b)(3) of the Social Secu-
22
rity Act (42 U.S.C. 1395m–1(b)(3)), as amended by
23
paragraph (1), is amended—
24
(A) in subparagraph (A)—
25
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•HR 1835 IH
(i) by striking ‘‘test for 2017 and
1
each succeeding year—’’ and inserting
2
‘‘test—
3
‘‘(i) for 2017 and each succeeding
4
year’’;
5
(ii) in clause (i), as added by clause
6
(i) of this subparagraph, by striking the
7
period and inserting ‘‘; and’’; and
8
(iii) by adding at the end the fol-
9
lowing new clause:
10
‘‘(ii) for 2024 and each succeeding
11
year, shall not result in an increase in pay-
12
ments for a clinical diagnostic laboratory
13
test for the year of greater than the appli-
14
cable percent (as defined in subparagraph
15
(D)) of the amount of payment for the test
16
for the preceding year.’’;
17
(B) in subparagraph (B), in the matter
18
preceding clause (i), by striking ‘‘In this para-
19
graph’’ and inserting ‘‘In clause (i) of subpara-
20
graph (A)’’; and
21
(C) by adding at the end the following new
22
subparagraph:
23
‘‘(D) DEFINITION
OF
APPLICABLE
PER-
24
CENT FOR PURPOSES OF ANNUAL CAP ON PAY-
25
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•HR 1835 IH
MENT INCREASES.—In clause (ii) of subpara-
1
graph (A), the term ‘applicable percent’ means
2
the following:
3
‘‘(i) WIDELY AVAILABLE CLINICAL DI-
4
AGNOSTIC LABORATORY TESTS.—With re-
5
spect to a widely available clinical diag-
6
nostic laboratory test—
7
‘‘(I) for 2024, 2.5 percent;
8
‘‘(II) for 2025, 2.5 percent;
9
‘‘(III) for 2026, 3.75 percent,
10
‘‘(IV) for 2027, 3.75 percent;
11
and
12
‘‘(V) for 2028 and each subse-
13
quent year, 5 percent.
14
‘‘(ii) OTHER
CLINICAL
DIAGNOSTIC
15
LABORATORY
TESTS.—With respect to a
16
clinical diagnostic laboratory test not de-
17
scribed in clause (i), 5 percent.’’.
18
(3)
CONFORMING
AMENDMENT.—Section
19
1834A(b)(3) of the Social Security Act (42 U.S.C.
20
1395m–1(b)(3)) is amended in the heading by strik-
21
ing ‘‘REDUCTIONS’’ and inserting ‘‘MEDICARE PAY-
22
MENT CHANGES’’.
23
(e) REGULATIONS.—(1) Not later than December 31,
24
2024, the Secretary of Health and Human Services shall
25
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•HR 1835 IH
implement the amendments made by this section (other
1
than subsection (d)) through notice and comment rule-
2
making.
3
(2) The Secretary of Health and Human Services
4
may implement the amendments made by subsection (d)
5
through interim final rulemaking, program instruction, or
6
otherwise.
7
Æ
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