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Friday, June 14, 2013

OIG Spotlights Elevated Costs for Medicare Lab Tests

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An OIG report said Medicare could have saved $910 million in 2011 if clinical lab test payment rates had been reduced to the levels paid by Medicaid and Federal Employees Health Benefits (FEHB) plans. OIG looked at payment rates for 20 clinical lab tests across 56 geographic regions and determined that Medicare paid 20 percent more than Medicaid and between 18 to 30 percent more than three FEHB plans. The report said Medicare has little flexibility to adjust lab payment rates, while Medicaid and FEHB plans "reported that technological changes (e.g., benchmarking payment rates for new tests to the actual cost of performing them) are taken into account when establishing payment rates."

OIG recommended that CMS ask Congress to pass legislation to create a framework for lower lab test payment rates. OIG also said CMS should ask Congress to allow the implementation of copays and deductibles to lab tests. CMS neither agreed nor disagreed with the recommendations, and said it was looking into whether it currently has the authority to revise lab test payments.

 

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