CLN - Federal Insider

AACC Calls for CLIA Improvements as Fees Rise

Federal Insider: April 2019

The Centers for Medicare and Medicaid Services (CMS) has increased CLIA fees by 20%, the first increase in 20 years. Federal law requires the CLIA program to be self-sufficient, and costs to run the program have increased beyond the agency’s original projections.

AACC supports the increase but is asking CMS to outline how it plans to allocate the funds, both for current and future programs. AACC recently recommended improvements to CLIA, specifically to restart the agency’s Certificate of Waiver (CoW) project. Until CMS discontinued the program in 2016, the agency inspected 2% of waived laboratories annually and uncovered “serious quality problems” in some of these facilities, AACC notes in a letter to the agency.

AACC believes the data from the inspections could help the Centers for Disease Control and Prevention and CMS develop best practice documents and modules to improve the performance of all CoW laboratories. “As testing performed by waived facilities continues to grow and expand, it becomes more important to ensure these entities provide the highest quality testing possible,” the letter says. “Inspections should include a wide variety of CoW testing sites, such as physician office laboratories, home health agencies, pharmacies, retail stores, and nursing homes.” The number of CoW laboratories grew from 44% of all clinical laboratory testing sites in 1993 to 71% in 2018.

AACC also suggests that with increased income CMS should examine its role in ensuring the quality of laboratory developed tests (LDTs). “AACC believes that the CLIA oversight structure for LDTs is appropriate and would support reasonable evidence-based improvements within the confines of CLIA to address LDT concerns,” AACC emphasizes in the letter. “CMS should play a central role in facilitating this process.”

In October 2018, AACC published a position statement on modernizing CLIA and ensuring quality at CoW laboratories. It called for CMS to resume its CoW inspection program and for Congress to fund a study examining the quality of testing at these facilities.

Health Spending On Track to Consume One-Fifth of GDP

National health expenditures will grow more than 5% per year over the next decade, eclipsing the growth of the overall U.S. economy as measured by gross domestic product (GDP) to the point that healthcare will swallow 19.4% of GDP by 2027.

Part of the increase comes from the prices of medical services themselves, projected to grow at 2.5% per year. Demographics also will play a greater role as baby boomers use more Medicare services. The Centers for Medicare and Medicaid Services (CMS) projects Medicare spending will grow faster than any other payer’s, 7.4% per year through 2027. By that year, CMS expects the government to be paying for 47% of U.S. healthcare costs.

Medicaid will not grow quite as fast as Medicare, with annual average growth of 5.5%. Medicaid expansions during 2019 in Idaho, Maine, Nebraska, Utah, and Virginia are expected to result in the first acceleration in spending for the program since 2014—from 2.2% in 2018 to 4.8% in 2019. Medicaid spending will soon accelerate, averaging 6% per year between 2020 and 2027. Spending on hospital care is projected to grow as fast as that on prescription drugs, 5.6%.

The money Americans spend on private insurance and out-of-pocket expenses actually should shrink during this time frame, partly as a result of baby boomers aging into Medicare. For 2018-2027, private health insurance spending growth will average 4.8%, slowest among the major payers. Out-of-pocket expenditures are projected to grow at the same rate and to represent 9.8% of total healthcare spending by 2027—down from 10.5% in 2017.