Changing How Medicare Pays for Clinical Diagnostic Laboratory Tests: An Update on CMS's Progress

Clinical diagnostic laboratory (lab) tests provide information integral to preventing, diagnosing, and treating disease in millions of Medicare beneficiaries every year. The Protecting Access to Medicare Act of 2014 (PAMA) requires reform of Medicare's payment system for lab tests-the first such reform in 3 decades. Beginning in 2018, Medicare payment rates-which are currently based on inflation-adjusted lab charges-will be replaced with new rates based on current charges in the private health care market. In response to a mandate contained in PAMA, OIG is monitoring Medicare payments for lab tests and CMS's implementation of the new payment system.