CLIA: CMS Proposes 20% Fee Increase—and Further Increases Could Follow

As if Year 2 of PAMA lab fees wasn’t enough, CMS dished out another dose of agita to the lab industry: CLIA fees will be going up 20%, effective this year.

Background
For those of you who are new to the industry, the CLIA statute, aka Clinical Laboratory Improvement Amendments of 1998, requires labs to obtain certification from CMS to legally perform tests on human specimens for purposes of providing information for the diagnosis, prevention or treatment or assessment of health. CLIA fees are paid by labs seeking certification and used to defray CLIA program expenses.

Why Now?
The 2019 increase, the first since 1998, is made necessary by the simple fact that current fees aren’t enough to cover program costs. According to CMS, “the current fee schedule is based on assumptions about program operations and workload made in 1992.” The agency claims that the 20% fee increase is necessary to sustain and maintain the CLIA program through FY 2021.

Impact on Labs
The increase impacts certificate fees, which are billed on a two-year cycle. Certificate fees are based on 11 lab classification categories. Previous fees ranged from $150 (for low volume labs) to $7,940. The increase will take the range from between $180 to $9,528. The increase also applies to compliance determination fees and inspection fees for non-certified labs.

One-Time Adjustment or More to Follow?
CMS has positioned the 20% increase as a one-time adjustment to meet a budget shortfall. However, information shared at the Federal Register –The Daily Journal of the United States Government suggests that the shortfall has been ongoing. In fact, even though the 2017 shortfall is nearly double that of 2016, CMS comparative analysis for FYs 2012 through 2017 shows a shortfall for each of the last six years:

Shortfall by Year

Bottom Line: Based on these numbers, the 20% increase, as substantial as it is, may not be enough and may ultimately turn out to be just the first of several adjustments necessary to put the CLIA program on sound financial footing.

‘Got Comments?’

If you want to let CMS know what you think of the fee increase and changes to the calculation formula, you can comment electronically, via U.S. mail or by express/overnight carrier. Details for comment submissions are provided in the agency’s notice. Deadline to comment: March 1.