Pathologists find new Part A contract model creates added value for hospitals

Now pathologists have a new approach to reverse the trend for hospitals and health systems to pay even less for Part A pathology professional services. Innovative pathologists are crafting what they call a “performance-based Part A Support” agreement that adds new value for the hospital, along with additional compensation for the pathologists.

For pathologists, this is a major breakthrough in stabilizing and increasing hospital compensation for these important services. After all, for most of the past decade, many hospitals arbitrarily cut reimbursement for Part A pathology professional services—even as these hospitals held pathologists to ever-higher standards, including improved patient outcomes and more resources devoted to patient safety in the hospital’s clinical laboratory.

Hear Dr. Saraswathi Nair speak on April 21st, 2010.

Dr. Saraswathi Nair will speak on Part A contracts.

One architect of this new approach to negotiating increased compensation for Part A pathology professional service contracts is Robert H. Tessier, Senior Reimbursement Consultant at HBP Financial Services Group, Ltd. of Woodbridge, Connecticut. “Our value-based approach to Part A pathology compensation focuses on the improved results that every hospital wants from its clinical pathologists,” said Tessier. “Every hospital needs assurance that the money it pays for Part A pathology makes a positive difference to their bottom line. This new performance model achieves that goal.”

Tessier collaborated with Saraswathi Nair, M.D., Chair of the Pathology Department at Norwalk Hospital in Norwalk, Connecticut “Our objective was to deal from strength in negotiations for the Part A Pathology Professional Services Contract,” she stated. “We took the position that the hospital would be motivated to compensate pathologists for achieving improvements using objective measures.

“That proved to be the case,” continued Tessier. “Hospital administrators quickly saw how a performance-based Part A Pathology Professional Service Agreement aligned the interests of the hospital and the pathologists in useful ways. Since the new Part A pathology contract took effect, three things have made it easy to administer.

  • First, the results used to determine performance-based payments for Part A pathology services are easy to verify.
  • Second, criteria are objective so that the hospital and pathologists are more comfortable on the basis for Part A pathology payments.
  • Third, future goals for these ongoing agreements were defined so that the hospital and the pathologists are collaborating on a multi-year program that supports continuous improvements,” explained Tessier.

Together, Tessier and the pathologists at Norwalk Hospital are demonstrating how a performance-based model for Part A Pathology Professional Services reframes contract negotiations—moving the discussion away from common pathologist strategy of reimbursement based solely on “time studies.” Instead, this performance-based model creates a powerful alignment of pathologists and hospital administrators—an alignment that results in financial benefit to all parties.

“The success of this performance-based approach was a validation of our negotiating strategy with hospital administrators,” explained Tessier. “However, there are certain pitfalls that pathologists should avoid when adopting this negotiating position. A significant amount of forethought and preparation is necessary to develop and implement a performance based Part A Pathology Professional Service agreement.”

To share the power of the performance-based approach to hospital Part A Pathology Professional Service agreements, both Robert Tessier and Department Chair, Saraswathi Nair, M.D., will participate in a special audio conference titled “Negotiating Pathology Part A Reimbursement with Hospitals: Why the Performance-Based Approach Opens the Door to Increased Value.” The event takes place on Wednesday April 21, 2010 at 1 p.m. EDT; 12 p.m. CDT; 11 a.m. MDT; 10 a.m. PDT. For information and to register, visit

Tessier and Dr. Nair will provide a roadmap to help your pathology group or hospital understand how the performance-based approach to a Part A Pathology Professional Service contract works. You’ll learn the best ways to identify the value points of greatest interest to both the hospital and the pathologists, illustrated by the real experience at Dr. Nair’s Connecticut hospital.

Too often, pathology Part A Professional Service agreements with hospitals and health systems turn out poorly for the pathologists. Now you have an opportunity to reverse this destructive and financially-corrosive trend. Gain the perspectives you need to develop an effective performance-based Part A Pathology Professional Service agreement with your hospital.

This valuable audio conference is a great opportunity for everyone in your hospital or health system who is involved in negotiating and administering Part A Pathology Professional Service agreements, including:

  • Hospital-based pathology chiefs
  • Pathology practice administrators and consultants
  • Hospital administrators who negotiate Part A pathology contracts
  • Department managers
  • Lawyers and financial experts who negotiate these types of agreements.

Register for this audio conference to hear this never-before-shared information. Master the insights about this exciting new strategy for getting the most out of your Part A Professional Service agreement. For pathologists, it’s the best way to get the recognition-and the compensation-you deserve. And for hospital administrators, it’s a chance to develop a partnership with your pathologists that will provide your hospital with results you can measure—not just hours spent in the clinical laboratory!

DATE: Wednesday, April 21, 2010

TIME: 1 p.m. EDT; 12 p.m. CDT; 11 a.m. MDT; 10 a.m. PDT

PLACE: Your telephone or speakerphone

COST: $245 per dial-in site

TO REGISTER: Click here or call 1-800-560-6363 toll-free

Related Information:

Negotiating Pathology Part A Reimbursement with Hospitals: Why the Performance-Based Approach Opens the Door to Increased Value

Pathology Part A Information Package

Cost-based (Part A) pathology physician services: Origin, current spectrum, and future.