November 14, 2003 - ASM Letter to Medicare Conferees

The Honorable Bill Thomas
Chairman, House Ways and Means Committee
1102 Longworth House Office Building
Washington, DC 20515

Dear Chairman Thomas:

As you work to finalize the Medicare/Prescription Drug package (H.R. 1), the American Society for Microbiology (ASM) strongly urges you to oppose cuts that would adversely affect clinical laboratories, such as co-payments for laboratory testing, a freeze on cost of living adjustments to Medicare payments laboratory services, and/or further reductions in the reimbursement of laboratory tests covered by Medicare.

Medicare laboratory payments have experienced chronic erosion over the past ten years. The Balanced Budget Act (BBA) of 1997 totally eliminated a Consumer Price Index (CPI) increase for clinical diagnostic laboratory tests from 1998 through 2002. This action further compounded previous reductions to the clinical diagnostic laboratory fee schedule under Medicare. Laboratories continue to face growing costs stemming from a myriad of factors including new federal regulations, laboratory personnel shortages, and ongoing efforts to improve safety and keep pace with technology. Additional reductions from Medicare cuts on laboratory testing may have an adverse effect on clinical and public health laboratory infrastructure and the ability to deliver clinically relevant services, particularly during a time when laboratories are confronted with emerging infectious diseases such as SARS, monkeypox and West Nile Virus, antimicrobial resistance, and the threat of bioterrorist agents.

In 2002, the Institute of Medicine (IOM) released a study that assessed the current Medicare laboratory payment system and provided recommendations to improve it. The IOM Report, Medicare Laboratory Payment Policy, Now and in the Future, stated that “Inadequate payment rates could slow the industry’s ability to develop and disseminate new technology and laboratories’ willingness to adopt valuable but more expensive technologies.” Furthermore, the report recommended against Medicare co-payments for laboratory tests, asserting that, “cost sharing is unlikely to significantly reduce overuse or increase the detection of fraud and abuse; it could create barriers to access for the most vulnerable Medicare beneficiaries; and it would be financially and administratively burdensome for laboratories, patients, and the Medicare program depending on its design.”

Laboratory test results provide critical diagnostic information necessary for the selection of and appropriate utilization of prescription therapies, as well as additional patient care options. It is critical that Medicare beneficiaries continue to have adequate access to the full range of quality laboratory services throughout the nation. Thank you for your consideration of this important issue.


Gail H. Cassell, Ph.D., Chair, Public and Scientific Affairs Board
Alice S. Weissfeld, Ph.D., Chair, PSAB Committee on Professional Affairs