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Congress Moves to Permanently Restore Medicare Coverage of Pharmacy Lab Tests

by Glenn S. Demby | Jun 28, 2023 | Essential, Legislation-nir, National Lab Reporter

Congress is renewing its previous efforts to make Medicare reimbursement of pharmacy testing permanent—here’s what that could mean for labs.

Pharmacies that provide point-of-care (POC) lab testing got a massive financial boost during the pandemic when Medicare relaxed its coverage rules to allow Part B payment for pharmacist-provided COVID-19 tests. Now that the public health emergency (PHE) has ended and the usual payment rules are back in effect, Congress is renewing its previous efforts to make Medicare reimbursement of pharmacy testing permanent. Here’s a quick briefing on the legislation that’s on the table and its potential impact on labs and the lab industry.

The Proposed Legislation

Though Medicare usually only reimburses lab tests provided by physicians or nonphysician practitioners, a group of bipartisan House members has reproposed a bill that would make Medicare coverage of pharmacist-administered tests permanent. Specifically, the Equitable Community Access to Pharmacist Services Act (Bill H.R. 1770), which was initially introduced as Bill H.R.7213 on March 24, 2022, would provide permanent Medicare coverage for pharmacist testing and testing-related services for:¹

COVID-19

Influenza

Respiratory syncytial virus (RSV)

Streptococcal pharyngitis (strep throat)

Other conditions that the U.S. Department of Health and Human Services (HHS) identifies in the future as being necessary to close “gaps in health equity”²

H.R. 1770 would also allow pharmacists to prescribe treatments for the stated illnesses based on the results of the lab tests as well as administer any available vaccinations. Pharmacists would then be able to bill Medicare Part B for those services and receive reimbursement at 85 percent of the Medicare Physician Fee Schedule amount.

“Seniors…in communities across the country have come to rely on the critical care and services that pharmacists provide,” stated Representative Larry Bucshon, MD (R-IN), one of the bill’s 11 bipartisan co-sponsors, in a press release issued after the bill’s reintroduction on March 24, 2023. Passage of H.R. 1770 would ensure that “pharmacists have the ability to continue to provide the care that they are already licensed to provide and that their communities need.”³

While it lagged last year, the reintroduced H.R. 1770 has gained a greater urgency now that the COVID-19 PHE has officially ended. Adding to the momentum, a bipartisan group of five senators recently proposed their own version of the bill called the Pharmacy and Medically Underserved Areas Enhancement Act.⁴ The main difference, other than slightly lower Medicare reimbursement rates, is that the Senate bill would limit coverage of pharmacist lab tests to areas that the HHS Secretary designates as medically underserved.

Potential Impact: Expanded Access or Scope Creep?

Rapid expansion of POC testing in near-patient healthcare settings authorized to furnish lab testing under a CLIA Certificate of Waiver (CoW) predates the pandemic. Pharmacies seeking to raise additional revenues beyond drug dispensing have figured prominently in this trend.

According to a 2021 National Institutes of Health (NIH) National Center for Biotechnology Information (NCBI) study, between 2015 and 2020, pharmacies in the US with a CoW increased from 10,838 to 15,703, a growth rate of 45 percent.⁵ The PHE accelerated this growth. Today, there are 26,765 CoW pharmacies. Stated differently, 8.39 percent of all entities with a CoW are pharmacies, second only to physician offices (38.65 percent), according to May 2023 data from the Centers for Medicare & Medicaid Services (CMS).⁶

While the rapid growth of pharmacy-based testing can’t be denied, whether it’s a good idea to let pharmacies perform lab tests is subject to debate. Supporters of the concept, including the 16 sponsors of the new House and Senate bills, claim that enabling pharmacists to perform lab tests and testing-related services broadens patients’ testing and treatment options.

However, clinical groups like the American Medical Associat ion, American Hospital Association, and American Association for Clinical Chemistry (AACC) are more wary of what they perceive as “scope creep,” or entrusting medical services to those without the proven skills, training, and qualifications necessary to perform them safely and effectively.⁷

In October 2021, the AACC published a position paper calling on CMS to step up its oversight of facilities performing waived testing and urging them to adopt good laboratory practices, which aren’t mandatory for CoW testing facilities. The AACC cites the “significant, widespread deficiencies among CoW laboratories” that CMS has documented over the years, including failure to:⁸

Have test manufacturer’s instructions

Perform QC as directed by the manufacturer

Correctly report patient test results

Properly store and handle reagents

Such deficiencies may cause testing errors and harm to patients, the AACC warns. The position paper also raises concerns about CoW facilities’ operator training and competency to use POC testing instruments and techniques.

Takeaway

For better or worse, pharmacist-based lab testing is on the rise. The rate of growth will depend largely on whether Medicare and other payers reimburse pharmacies for providing tests and testing services. Accordingly, the end of the PHE on May 11 and restoration of normal Medicare lab testing payment rules on May 11 took some air out of the balloon.

However, passage of the new House and Senate pharmacy testing Medicare coverage bills would not only restore but also accelerate the momentum. While neither proposed bill specifically requires it, the expectation is that passage of legislation requiring Medicare payment of pharmacist lab testing will influence private payers to expand their own coverage rules. Should things come to that, the AACC case for stricter regulation of pharmacy and other CoW labs would become even more compelling.