In a welcome development for the laboratory industry, on December 29, 2022, President Biden signed the Continuing Appropriations Act of 2023 which instructs the Centers for Medicare & Medicaid Services to suspend for one year the implementation of the next round of price cuts to the Medicare Part B Clinical Laboratory Fee Schedule (CLFS) called for under the Protecting Access to Medicare Act (PAMA).

Under the spending bill provision, there will be no reductions in Medicare payments for diagnostic tests through 2023. Without this Congressional intervention, laboratories faced up to 15 percent cuts in Medicare payments for tests paid under the CLFS.

In addition, the law suspends PAMA-related reporting requirements for labs in 2023 for one year. Per the PAMA statute, in 2023, CMS was to have labs report the prices for tests paid by private health plans which it would then use that private payer price data to set prices for the CLFS. The next PAMA data reporting period is now January 1, 2024, through March 31, 2024, and will be based on the original data collection period of January 1, 2019, through June 30, 2019.