Oct 9, 2017 | Instruments & Equipment, Laboratory Instruments & Laboratory Equipment, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing
Mobile point-of-care (POC) smartphone-based nucleic acid assay allows for quick turn arounds and accurate information in any healthcare setting, including resource limited and remote environments
DNA detection might soon be accomplished with the use of a smartphone. That’s the goal of a research effort at the University of California Los Angeles (UCLA). If this effort succeeds, it would give medical laboratories a new tool to use in genetic testing.
Clinical laboratory equipment is becoming more effective even as it shrinks in size and cost. One such device has been developed by Ozcan Laboratory Group, headed by UCLA professor Aydogan Ozcan, PhD. It is a portable, smartphone-based mobile lab with sensitivity and reliability on par with large-scale medical laboratory-based equipment.
Ozcan Lab’s portable DNA detection system, according to a UCLA press release, “leverages the sensors and optics of cellphones” and adapts them to read and report the presence of DNA molecules. The sensor uses a new detector dye mixture and reportedly produces a signal that is 10 to 20 times brighter than previous detector dye outputs.
This new system improves upon the optical detection abilities of current point-of-care nucleic acid tests (POCTs) and, according to a study published in the American Chemical Society’s ACS Nano, the device is able to “retain the same robust standards of benchtop lab-based tests.”
Go Anywhere Technology Improves POC Testing
Nucleic acid detecting assays are crucial tools anatomic pathologists use to identify pathogens, detect residual disease markers, and identify treatable mutations of diseases. Due to the need for amplification of nucleic acids for detection with benchtop equipment, there are challenges associated with providing rapid diagnostics outside the clinical laboratory.
The device developed by Ozcan Labs (above) is a “field-portable and cost-effective mobile-phone-based nucleic acid amplification and readout platform [that] is broadly applicable to other real-time nucleic acid amplification tests by similarly modulating intercalating dye performance. It is compatible with any fluorescence-based assay that can be run in a 96-well microplate format, making it especially valuable for POC and resource-limited settings.” (Caption and photo copyright: American Chemical Society.)
In an article published in Future Medicine, Ozcan and Hatice Ceylan Koydemir, PhD, a post-doctoral researcher in electrical engineering at UCLA, comment on the growing interest in mobile POC diagnostics, stating that smartphone-based devices and platforms have the potential “to be used for early detection and prevention of a variety of health problems.”
According to the article, smartphone-based sensing and imaging platforms have been developed to:
- Analyze chemicals and biological specimens;
- Perform advanced cytometry and bright-field/fluorescence microscopy;
- Detect bacterial contamination;
- Image nano-sized specimens;
- Detect antimicrobial drug resistance; and
- Analyze enzyme-linked immunosorbent assay (ELISA)-based testing.
Smartphones, according to Ozcan and Koydemir, have been adapted to a range of biomedical measurement tools, “have the potential to transform traditional uses of imaging, sensing, and diagnostic systems, especially for point-of-care applications and field settings,” and can provide speedy results.
A ‘Highly Stable’ and Sensitive System
The proof-of-concept study of Ozcan Lab’s new smartphone-based detection system and new detector dye mixture was led by Janay E. Kong, PhD in bioengineering at UCLA, with the help of Ozcan and fellow professors Dino Di Carlo, PhD, professor of bioengineering and mechanical and aerospace engineering at UCLA, and Omai Garner, PhD, associate professor of clinical microbiology at the David Geffen School of Medicine at UCLA.
According to an article in Bioscience Technologies, the new smartphone DNA detection system addresses issues with detection of light emitted from intercalator dyes, which are normally “too subtle and unstable for regular cellphone camera sensors.” The new system uses loop-mediated isothermal amplification (LAMP) to amplify DNA in connection with a newly developed dye that uses hydroxynaphthol blue (HNB) as an indicator.
The inclusion of HNB into the dye, according to the original research study, “yields 20 times higher fluorescent signal change over background compared to current intercalating dyes,” making the results bright enough for smartphone camera sensors without “interfering with the nucleic acid amplification process.” The original study reports that the digital LAMP system and use of the HNB intercalating dye, in fact, provided “significantly enhanced performance compared to a benchtop reader with standard LAMP conditions.”
Ozcan labs shows no signs of slowing down their development of mobile POC diagnostic devices. The development of these smartphone-based tools may provide unique and much-needed equipment for clinical pathologists given the rising interest in mobile healthcare worldwide.
— Amanda Warren
Related Information:
UCLA Researchers Make DNA Detection Portable, Affordable Using Cellphones
Mobile Phones Create New Opportunities for Microbiology Research and Clinical Applications
Highly Stable and Sensitive Nucleic Acid Amplification and Cell-Phone-Based Readout
Cellphone System Makes DNA Detection Affordable and Portable
UCLA Device Enables Diagnosis of Antimicrobial Resistance in Any Setting; Could Save Lives Lost to Antimicrobial Resistant Bacteria
UCLA Researchers Develop Lens-Free Smartphone Microscope, Pathologists May Be Able to Take the Clinical Pathology Laboratory Just About Anywhere
Smartphone “Dongle” Achieves Capabilities of Big Clinical Laboratory Analyzers: Diagnoses Three Diseases at Once from Single Drop of Blood
New Fast, Inexpensive, Mobile Device Accurately Identifies Healthcare-Acquired Infections and Communicates Findings to Doctors’ Smartphones and Portable Computers
Pathologists and Researchers Predict Development Trajectory for Biomarker-based Molecular Diagnostics in Support of Translational Medicine
Tiny, Simple-to-Use Lensless Microscope Might Soon Find a Place in Pathology
Oct 6, 2017 | Instruments & Equipment, Laboratory Instruments & Laboratory Equipment, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing
Identification of 144 elevated phosphoproteins indicative of cancer shows one possible path forward in the use of liquid biopsies for early detection of cancer and monitoring patients in remission
While precision medicine and a growing menu of medical laboratory assays and diagnostics are increasing the number of treatment methods available to cancer patients, early detection is still key to improving outcomes and increasing the odds of survival.
In February 2017, a Dark Daily ebriefing titled, “British Medical Laboratory Test for Early Screening of Lung Cancer Shows Promising Interim Results in Large Trial; Could Lead to Other Simple Blood Tests for Cancer Detection,” showcased the EarlyCDT-Lung test. In a University of Dundee press release, researchers noted the non-invasive test promised detection of lung cancer “potentially up to five years” earlier than traditional scans.
Now, researchers from Purdue University are testing a non-invasive blood test for detection of all types of cancer using phosphoproteins as biomarkers that could detect cancer even before the onset of any symptoms. This could lead to non-invasive therapies, and ways to monitor them, that could be applied while the patient’s body is still strong and able to respond well to treatment.
Speaking with New Atlas, researcher W. Andy Tao, PhD, Chief Scientific Officer of Tymora Analytical Operations, stated, “This is definitely a breakthrough, showing the feasibility of using phosphoproteins in blood for detecting and monitoring diseases.”
Extracellular Vesicles as the Key to Isolating Phosphoproteins
Protein phosphorylation—particularly mutations in phosphatases and kinases—are already known to play roles in cancer development as noted in the OncLive article “Phosphorylation: The Master Switch of the Cell.”
However, as the liver uses phosphatase to dephosphorylate proteins, identification of phosphoproteins in the blood has remained difficult for researchers.
Isolating phosphoproteins from tissue samples is equally difficult. “Assays of phosphoproteins from tissues face tremendous challenges because of the invasive nature of tissue biopsy and the highly dynamic nature of protein phosphorylation during the typically long and complex procedure of tissue biopsy,” noted I-Hsuan Chen, PhD Candidate, and W. Andy Tao, PhD, in their study published in Proceedings of the National Academy of Sciences of the United States of America (PNAS).
As shown in the illustration above, extracellular vesicles are basically blobs of cellular cytosol that contain microRNA (miRNA) Messenger RNA (mRNA) and proteins, which some researchers believe potentially could compete with stem cell-based therapeutics. (Image copyright: BioProcess Intl.)
In their attempts, researchers instead focused on the biomarker discovery potential of extracellular vesicles (EV)—in particular microvesicles and exosomes—citing strong evidence in the ability to use EV-based disease biomarkers well before symptoms appear.
“The ability to detect the genome output (active proteins, and in particular phosphoproteins) can provide more direct real-time information about the organism’s physiological function and disease progressions, particularly in cancers,” the PNAS study authors noted.
Researchers isolated nearly 2,400 phosphoproteins across 30 samples from breast cancer patients. They then compared these to six control samples and identified 144 specific proteins commonly elevated when cancer was present.
In a Purdue University press release, Timothy Ratliff, PhD, Director of Purdue University Center for Cancer Research expanded on the findings of the study, stating, “The vesicles and exosomes are present and released by all cancers, so it could be that there are general patterns for cancer tissues, but it’s more likely that [W. Andy Tao, PhD] will develop patterns associated with different cancers.”
Monitoring Cancer with a Blood-Based Cartridge Diagnostic
The Purdue University press release highlights the potential of the process, noting, “A simple blood test for cancer would be far less invasive than scopes or biopsies that remove tissue. A doctor could also regularly test a cancer patient’s blood to understand the effectiveness of treatment and monitor patients after treatment to see if the cancer is returning.”
The ability to capture EV phosphoproteins appears to be stable over time. The samples used in the Perdue University study were taken nearly five years ago by the Indiana Biobank.
While the stability of samples is a boon to researchers, they note that there are still many improvements to be made to the methods used before some medical laboratories could attempt to replicate their results.
Current methods require using differential high-speed and ultra-high-speed centrifugation. Study authors note this makes it less than ideal for clinical laboratory use due to lack of access and lower specificity.
However, the Purdue press release also notes plans for future improvements. Tymora Analytical Operations is developing technologies to use the biomarkers in a cartridge-based system. This could mean that pathology groups and medical laboratories might one day add an automated test to their menus for the second leading cause of death in the United States.
Until then, medical laboratories can help further efforts by collecting samples and working with biobanks, such as the one used in the Purdue study. Clinical laboratories already power much of the diagnostic tools driving innovation and discovery in oncological precision medicine. With the addition of a way to detect cancers, both while in remission or before symptoms appear, laboratories could further increase their role in fighting this worldwide killer.
—Jon Stone
Related Information:
Protein Discovery Points to Potential Blood Test for All Cancers
Phosphoproteins in Extracellular Vesicles as Candidate Markers for Breast Cancer
Breakthrough Discovery May Make Blood Test Feasible for Detecting Cancer
Phosphorylation: The Master Switch of the Cell
Overview of Protein Phosphorylation
Extracellular Vesicles Commercial Potential as Byproducts of Cell Manufacturing for Research and Therapeutic Use
Extracellular vesicles: An Introduction
British Medical Laboratory Test for Early Screening of Lung Cancer Shows Promising Interim Results in Large Trial; Could Lead to Other Simple Blood Tests for Cancer Detection
Oct 4, 2017 | Coding, Billing, and Collections, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing
To help patients pay their clinical laboratory test bills, Sonora Quest Laboratories partners with CarePayment to provide patients with no-interest loans
With tens of millions of Americans now covered by a high-deductible health plan (HDHP), hospitals, physicians, and clinical laboratories now share a common problem: how to collect the full amount due for a patient who may have an annual deductible of $5,000 (individual) or $10,000 (family).
This is a significant problem for healthcare providers and Dark Daily has reported on this trend several times, most recently in “Hospitals, Pathology Groups, Clinical Labs Struggling to Collect Payments from Patients with High-Deductible Health Plans,” September 6, 2017.
Thus, many pathologists and clinical laboratory managers will be interested in a new solution that the largest commercial laboratory company in Arizona is using to help cope with the need to collect larger amounts of money from patients with a high-deductible health plan. Recently, Senora Quest Laboratories announced an innovative collaboration with healthcare finance company CarePayment to ensure cost is not a barrier to clinical laboratory and pathology patients needing medical tests.
Sonora Quest Laboratories, which performs more than 60-million diagnostic tests per year in Arizona, has established a new partnership with CarePayment of Nashville to provide no-interest loans to any Sonora Quest patient whose testing bill exceeds $100.
David Dexter, Chief Executive Officer at Sonora Quest Laboratories, believes patients have a right to “affordable access to much-needed laboratory testing.” In a statement, Dexter notes, “Across Arizona, rising out-of-pocket medical costs are impacting families’ budgets, and ultimately, their health. No one should delay having clinical testing done because they are worried about costs.
“Sonora Quest Laboratories understands the importance of making healthcare services affordable to consumers,” he added. “We are working with CarePayment to do our part to provide affordable access to much needed laboratory testing. We believe this will help improve testing compliance and lead to better outcomes for patients managing chronic disease or monitoring their overall wellness.”
Annual Deductibles Rise 153% for Workers
The annual deductible that patients must cover is climbing, not just in Arizona, but nationally. According to the Kaiser Family Foundation 2016 Employer Health Benefits Survey, the average worker’s annual deductible has gone up 153% from 2009 to 2016. In addition, after meeting their annual deductibles, most workers face additional cost sharing for hospital admission or outpatient surgery.
To address the problem of collecting these larger deductibles from patients and to avoid racking up patient bad debt, Healthcare Finance News (HFN) points out that hospitals and healthcare providers are looking for financial solutions that “benefit both sides of the patient-provider relationship.”
As the graph above illustrates, more workers each year find themselves enrolled in high-deductible health plans (HDHPs) they can barely afford. That’s why hospitals, medical laboratory companies, and financial services organizations are partnering to develop programs patients can use to make affordable payments on their healthcare bills. (Image copyright: Kaiser Family Foundation/Obeo Health.)
To fill this need, a new type of company is popping up: third-party finance companies. CarePayment is one example. These new companies want to partner with hospitals and other healthcare organizations to identify patients who need assistance with out-of-pocket expenses. After a patient’s insurance company pays its portion of a bill, patients are referred to the healthcare finance company, which charges the hospital or provider a “discount factor” on the accounts it establishes.
Helping Clinical Laboratories, Pathology Groups Collect from Patients
According to CarePayment, enrollment in its programs is voluntary, requires no application, and has no impact on a patient’s credit score. CarePayment states that providers “double net collections on average” when patients use its financing solutions.
Craig Hodges, CEO of CarePayment, maintains innovative payment solutions are necessary because of the increased consumer responsibility for healthcare costs. “There’s evidence out there that asking a consumer to pay interest on top of their out-of-pocket expense is impractical,” Hodges stated in the HFN article. “Consumer responsibility for the [the total] bill has grown from sub 5% to 25%. There’s a lot of sticker shock out there.”
Third-party healthcare finance companies are not the only alternative financing option open to healthcare providers. Healthcare Finance News points out that Docpay offers automated clearinghouse payment plans, which require the patient to preauthorize a payment schedule from their bank account or credit card, guaranteeing payments are made each month. A service fee is charged to the patient that covers credit card processing fees as well as payment plan fees. According to the company’s website, a healthcare practice receives a higher net collection percentage than if they used a third-party financing company or processed credit card payments in-house.
Banks Get into the Act to Help Physicians, Hospitals, Medical Laboratories
NBC News adds that some hospitals are partnering with banks to offer patients no-interest or low-interest loans as well, with the goal of offering patients more affordable payment options while increasing payment rates.
David and Nicole Rayman of Chatham, Ill., told NBC News a zero-interest hospital loan saved them from high-interest financing after they were hit with an unexpected $2,800 bill to remove a benign growth from David’s neck. Under terms of the loan, they paid $80 a month for 36 months.
“That’s going out to dinner one time a month, so that’s definitely something we could cut out,” Nicole Rayman stated in the NBC News article.
Failure to Collect Bills Directly from Patients
While Hodges predicts that healthcare financing could potentially be a $70-billion industry, he also notes that growth has been fueled by providers’ difficulty communicating costs with consumers and collecting bills directly from them.
“As those high-deductible health plans grew over time, providers realized they didn’t have the infrastructure to deal with that,” Hodges noted in the HFN article. “The portion of the bill the patient was responsible for used to be small. As that grew, providers didn’t have the experience, in-house, to interact with the consumer in a consumer-like environment.”
While medical laboratories and other providers have been slow to embrace price transparency, Hodges believes simplified and transparent financial responsibility will fuel healthcare consumerism and improve the provider-patient relationship.
“My theory is that we have to evolve to total transparency,” he told Healthcare Finance News. “Here’s what the service is going to cost you from an out-of-pocket perspective—that’s the first step.”
This development is another sign HDHPs are creating financial challenges for clinical laboratories and pathology groups as more patients are unable to pay out-of-pocket cost for testing services. In this environment, medical laboratory managers and pathology practice administrators will need a strategy for collecting payments from patients at the time of service.
—Andrea Downing Peck
Related Information:
Sonora Quest Laboratories Partners with CarePayment to Help Patients Pay for Clinical Testing
Kaiser Family Foundation 2016 Employer Health Benefits Survey
Healthcare Turns to Zero-Interest Loans to Give Patients a Better Reason to Pay
Some Hospitals Will Now Offer You an Interest Free Loan
To Handle Increased Bad Debt by Patients in High-Deductible Health Plans, Hospitals Are Offering Loan Programs
Hospitals, Pathology Groups, Clinical Labs Struggling to Collect Payments from Patients with High-Deductible Health Plans
Oct 2, 2017 | Laboratory Hiring & Human Resources, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Management & Operations
Research conducted by Kalorama suggests the popularity of retail clinics represents a trend towards newer healthcare models that challenge existing models of care, and which could severely impact hospitals, clinical laboratories, and pathology groups
In recent years, pathologists and medical laboratory managers have watched as retail clinics housed in drug and grocery stores became a go-to service for healthcare customers seeking relief from minor illnesses. However, to market research company Kalorama, retail clinics also are a “game-changer” that could pose a threat to healthcare providers if their growth remains unchecked.
At risk are health systems and office-based physicians, along with the clinical laboratories and pathology groups that serve them. This would happen if patients shy away from primary care doctors in favor of cheaper, faster, medical care. However, as retail clinics expand the services they provide, they also could become an important source of orders for certain types of medical laboratory tests.
Kalorama defines retail clinics as, “healthcare centers that provide basic and preventative care in a retail setting; excluded are crisis and acute care centers; urgent care centers; emergency facilities; and wellness centers.” According to Kalorama’s data, “in 2016, total US retail clinic sales are estimated at more than $1.4 billion, an increase of 20.3% per year from $518 million in 2010.”
This increased use of retail clinics is a mixed blessing. On one hand, easy accessibility, low-wait times, and flexibility combined with lower costs for basic care is a boon for certain patients. On the other hand, this emergent healthcare model requires that traditional healthcare facilities address the impact of retail clinics on traditional practices, patient care, and regulatory standards.
Here are five reasons why retail clinics could threaten traditional healthcare models:
Retail Clinics Disrupt the Normal Healthcare Delivery Environment
Retail clinics are designed for immediate treatment of symptoms and vaccinations, not in-depth examination or long-term healthcare relationships between physician and patient. However, because retail clinics are a convenient low-cost option for patients, they become direct competition for full-service. Why visit a primary care physician (PCP) when you can receive off-hour care at lower prices and with faster wait times?
Based on data from peer-reviewed journal Mayo Clinic Proceedings, the graph above illustrates the huge growth of retail clinics over just the past 10 years, which is expected to continue. (Image copyright: Accenture Consulting.)
There is a rising fear among PCPs that the quick fix of retail clinic services will translate into poorer overall health for patients who fail to establish permanent long-term healthcare connections. This fear is validated by an American Medical Association (AMA) report that states, “only 39% of retail clinic users report having an established relationship with a primary care physician, which contrasts to about 80% of the general population reporting such a relationship.”
Retail Clinics Increase Competition for Primary Care Practices
Rather than competing with emergency departments, retail clinics directly compete with primary care clinics, according to Kalorama and the AMA. Staffed primarily by nurse practitioners and physician assistants, retail clinics treat symptoms of acute and easily identifiable health issues. There is growing concern that this limits opportunity for patients to receive more comprehensive healthcare that includes identification and treatment of chronic diseases.
And though competition in the healthcare market is good, physicians worry that retail clinics may push smaller stand-alone clinics out of business. The Kalorama report explains that “ultimately, medical practices are businesses that rely upon a steady flow of [patients] for their success.” When primary care facilities close due to loss of patients, it can create immediate healthcare gaps in communities.
Retail Clinics Could Increase Strain on Medical Laboratories and Pathology Groups
Kalorama’s data shows that retail clinics could place strain on medical laboratories and pathology practices. The study notes, “retail clinics are becoming relatively large users of point-of-care (POC) tests, clinical chemistry, and immunoassay laboratory tests and vaccines.” Kalorama’s report states, “the combined sales of these three types of products to retail clinics reached $240 million” in 2015, reflecting a 26% per year growth in testing since 2010. Projections from Kalorama suggest further increases in retail clinic test ordering in years to come.
The Clinical Laboratory Improvement Amendments (CLIA) advisory boards, the US Food and Drug Administration (FDA), and the Commission on Office Laboratory Accreditation (COLA) all have expressed concerns about the rise of retail clinic testing. COLA’s 2017 Spring Newsletter states that the increased use of retail clinics could lead to unnecessary testing, and increasing use of “non-laboratory personnel for laboratory testing.”
The COLA newsletter also warns that pathologists and clinical laboratory managers “should expect to see, over time, a steady increase in the menu of diagnostic testing offered by retail clinics.” COLA suggests that pathologists and laboratory scientists will experience increased demand from retail clinics for their services and expertise, but that because retail clinics often require high-volume, fast-paced testing without the benefit of full clinical laboratories (both in terms of staff and equipment) there is potential for retail clinic testing to fall short of industry standards.
Retail Clinics Fragment Health Records
According to an article in AMA Wire, the AMA House of Delegates (HOD) established guidelines for retail clinics that focus on continuity of medical records and the safeguarding of patient care. The guidelines state that retail clinics “must produce patient visit summaries that are transferred to the appropriate physicians and other healthcare providers in a meaningful format that prominently highlights salient patient information.” The fear, according to the AMA, is that the fragmenting of medical records may bring harm to patients via miscommunication that undermines patient-physician relationships and complicates oversight in treatment plans.
The Kalorama report echoes this sentiment. It states that physicians often take a negative view of retail clinics because of the lack of communication between retail clinics and primary care practices, citing a lack of cooperation or “unwillingness or inability on the part of convenience clinics to share medical information about patients with primary care providers.”
Retail Clinics Are Expanding Their Reach
Despite the fact that the AMA Council on Medical Services 2017 report on delivery reform recommends that retail clinics limit the scope of their care, expansion of retail clinic services has gone unchecked in many areas according to the Kalorama report. AMA policy states that retail clinics must have a “well-defined and limited scope of clinical services,” and the AMA’s 2017 guidelines state that “retail health clinics should neither expand their scope of services beyond minor acute illnesses … nor expand their scope of services to include infusions or injections.”
As retail clinics open around the country and expand their offerings there is a call for increased regulation of retail clinics to check that growth. COLA states that retail clinics are positioning themselves to play a major role in the delivery of primary care services. And the Kalorama report suggests that the trend towards retail clinic use will continue to rise, creating both challenges and opportunities for providers, clinical laboratories, pathologists, and healthcare policy makers who will be required to address the disruption to their businesses.
-Amanda Warren
Related Information:
Retail Clinics 2017: The Game-Changer in Healthcare
Report 7 of The Council on Medical Service: Retail Health Clinics
COLA’s Insights Spring 2017: The Rise of Retail Medicine
The Advance of the Retail Health Clinic Market: The Liability Risk Physicians May Potentially Face When Supervising or Collaborating with Other Professionals
Primary Care Practice Response to Retail Clinics
Retail Clinics are Poised to Offer More Health Services, Participate in ACOS, and Offer Expanded Menu of Clinical Pathology Laboratory Tests
Retail Clinics Continue to Shape Local Healthcare Markets
More Medical Laboratory Testing Expected as Retail Clinics Change Delivery of Routine Healthcare Services
Top-5 Diagnostics Trends Identified by Kalorama Will Impact In Vitro Diagnostics Manufacturers, Medical Laboratories in 2017
UnitedHealth’s Plans to Build More MedExpress Urgent Care Centers Is a Sign of Strong Consumer Demand and Could Be an Opportunity for Clinical Laboratories
Sep 25, 2017 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Management & Operations
Payers are cutting reimbursements for anatomic pathology services, making it essential for every pathology group to understand its financial present and future
Certain pathology business leaders are warning their colleagues that the era of private pathology group practice domination of the anatomic pathology marketplace is about to end. The only question is how rapidly the clinical and financial foundations of smaller pathology group practices erodes to the point where these groups are unable to generate adequate reimbursement to sustain the practice and the incomes of the individual pathologists.
However, along with this bad news comes a note of optimism. There is a once-in-a-lifetime opportunity for the anatomic pathology profession to take ownership of genetic testing and precision medicine—the most important diagnostic technologies to emerge in the past 100 years. The danger for anatomic pathologists is how to successfully transition from the private group practice model to the new clinical practice models that deliver genetic testing and precision medicine services.
Why Pathologists Are Making Less Money Today
The economic plight of private practice pathology is familiar to all pathologists. During the past decade, reimbursement for technical component (TC) and professional component (PC) services was regularly beat down by payers. For example, pathologists lost the TC grandfather clause in 2012, which immediately caused many histology labs to go from profit to loss. (See Dark Daily, “In Fixing Physician Medicare Pay, Congress Enacts Yet Another Cut in Clinical Laboratory Test Fee Schedule,” February 12, 2012.)
Similarly, over the past 10 years, each time private health insurers negotiated the renewal of a managed care contract with a pathology group practice, they aggressively cut the prices they paid for anatomic pathology services. And the corresponding explosive growth of narrow provider networks exacerbated the financial erosion from lower prices. Many smaller pathology groups found themselves excluded from these networks, causing them to lose access to the large numbers of private-pay patients served by these networks.
“It is important for every surgical pathologist and every pathology practice administrator to recognize that they have the ability to negotiate much more favorable terms and increased network access with health insurers, but only if they come to the negotiating table with the right information and techniques,” observed Robert L. Michel, Editor-in-Chief of Dark Daily and The Dark Report. “Pathology groups showing strong financial performance today know these techniques and strategies. When negotiating managed care contracts, they achieve higher reimbursements, more favorable terms, and in-network status.”
Proven Ways to Help Pathology Groups Protect and Increase Revenue
Pathologists who would like to protect their groups’ revenue and bolster their partners’ income have the opportunity to learn and master the most effective managed care contracting techniques and strategies. Three nationally prominent experts in pathology business and operations are participating in a special webinar, titled “How Payers Are Repricing Anatomic Pathology: Your Financial Present and Your Pathology Group’s Future,” which takes place on Thursday, September 28, 2017 at 2:00 p.m. EDT.
Pictured above left to right are Mick Raich, President and CEO, Vachette Pathology; Jeffrey Pearson, MD, System Medical Director, Bronson Hospital Laboratories; and, Christopher Jahnle, co-founder and Managing Director, Haverford Healthcare Advisors. The three distinguished speakers will share expertise and experiences you can use to protect your pathology group’s revenue while preserving partner income. (Photo copyright: Dark Daily.)
First to speak on this webinar is Mick Raich, founder and CEO of Vachette Pathology, of Blissfield, Mich. He will discuss how Medicare and private insurers are using new pathology and lab repricing models to slash reimbursement and control utilization of expense pathology testing services. Raich will explain why payers are engaging such third-party companies as AIM Specialty Health of Chicago, Avalon Healthcare Solutions of Tampa, Fla., BeaconLBS of Montvale, N.J., and InformedDNA of St. Petersburg, Fla., to develop coverage guidelines, issue preauthorization, and manage the network of labs and pathology groups allowed to provide services.
Raich will further explain what pathologists must know about the Medicare Access and CHIP Reauthorization Act (MACRA) physician payment program, with its MIPS—Merit-based Incentive Payment System—that is designed to pay bonuses or assess penalties each year, depending on how individual physicians perform against their own operational and clinical benchmarks.
Insidious Methods Payers Use to ‘Take Back’ by Underpaying Certain Pathology Claims
Another topic that Raich will address can mean significantly greater collected revenue for your pathology group. He will explain the new phenomenon of how private payers are auditing error rates on claims, then taking back those overpayments by underpaying the labs or pathology groups on claims for specific CPT codes (current procedural terminology codes). Raich will show how your billing/collection team can detect these claims and recover full payment from the payers.
How One Pathology Group Practice Doubled in Size
The second important financial topic of the webinar involves the merger, acquisition, and consolidation of private pathology group practices. You’ll learn why many group practices are losing their independence due to declining revenue or because their parent hospital was acquired by a health system. Pathologist Jeffrey Pearson, MD, is the System Medical Director at Bronson Hospital Laboratories in Kalamazoo, Mich. He is also a partner and President of Pathology Services of Kalamazoo, PC.
During his tenure at Bronson, Pearson helped facilitate the acquisition and assimilation of two hospital laboratories and one for-profit laboratory. His pathology practice has doubled in size and developed a high degree of subspecialization. Each time, the pathology group associated with the acquired entity had to be integrated with his health system’s existing pathology group practice. Experiences will be shared regarding:
· How to assimilate acquired laboratories;
· Practice utilization management; and
· Leveraging success to grow the practice and obtain favorable part A contracts.
Understanding How to Increase the Value of Your Anatomic Pathology Group
To round out the financial techniques and strategies you and your pathology practice administrator can use to protect your group’s revenue and boost partner income, the webinar’s third expert will discuss the latest developments in pathology practice mergers, acquisitions, and consolidations.
Christopher Jahnle is co-founder and Managing Director of Haverford Healthcare Advisors in Paoli, Penn., a suburb of Philadelphia. Over the past decade, his firm has represented Aurora Diagnostics of Palm Beach Gardens, Fla., as a purchaser of private pathology group practices.
Jahnle will describe the specific characteristics of a private pathology practice that have the highest value to buyers in today’s marketplace. You’ll understand how your pathology group’s unique mix of managed care contracts, hospital/health system relationships, and sub-specialist expertise will be valued by a potential acquirer or merger partner.
Jahnle will share case study examples to help you identify useful things your pathology group can do to make it more profitable and increase its value. This is essential knowledge if your group’s pathologists are considering such strategies as:
· “Should we merge with a bigger pathology group?”
· “Should we sell our pathology group?” and
· “Should we add subspecialists and pursue more hospital contracts?”
All three expert speakers have practical knowledge that you can use to protect your pathology group’s revenue while preserving partner income. It is why this webinar is timely and a “must attend” for you, your pathology practice administrator, and your pathology group’s legal and financial consultants.
Full details about this important webinar are at this link (or copy and paste this URL into your browser: http://pathologywebinars.com/how-payers-are-repricing-anatomic-pathology-your-financial-present-and-your-pathology-groups-future/).
—Michael McBride, Managing Editor
Related Information:
How Payers Are Repricing Anatomic Pathology: Your Financial Present and Your Pathology Group’s Future
In Fixing Physician Medicare Pay, Congress Enacts Yet Another Cut in Clinical Laboratory Test Fee Schedule
Sep 22, 2017 | Coding, Billing, and Collections, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement
Medical laboratories and pathology groups should expect point-of-service collection strategies to become increasingly important to their overall success
Not only is patient bad debt a growing problem for the nation’s hospitals, but it is now getting national attention within the hospital industry. This is bad news for clinical laboratories and anatomic pathology groups, because the same trends causing increased patient bad debt at hospitals are doing the same thing within the lab industry.
Much of the blame can be attributed to the increase number of patients with high-deductible health plans (HDHPs). The latest statistics reveal that patients’ out-of-pocket payments now make up 30% of hospital revenues. That is why hospitals desperately need strategies for successfully collecting payments from patients. And they’re not alone.
Kaiser Family Foundation (KFF) reported that more than half of all workers have deductibles and out-of-pocket liability of greater than $1,000. That is the reason why clinical laboratories and anatomic pathology groups also need a formula for collecting the total bill from their patients.
Jase DuRard, Chief Revenue Officer for revenue-cycle technology company AccuReg, told Modern Healthcare the increase in patient self-pay represents a seismic shift from roughly five years ago. At that time, patients paid only 10% of their hospital bills out-of-pocket and insurers paid about 90% of hospital claims.
Patient Responsibility to Blame for Revenue Loss at Nation’s Hospitals
A November 2016 study of 660 hospitals conducted by Crowe Horwath—an international public accounting, consulting, and technology firm—stated that “patient responsibility” was to blame for an overall managed care net revenue decline of 2.5% for outpatient care and 1.4% for inpatient care. Self-pay-after-insurance (SPAI) collection rates have improved slightly during the past 12 months—with the inpatient median rising 0.2% and outpatient median increasing 0.7%.
However, according to the Horwath report, “While seemingly a good sign for providers in the face of rising patient copays and deductibles, slight increases in patient collection rates are not enough to counter the larger increase in self-pay-after-insurance patient responsibilities.”
High-deductible health plans (HDHPs) are becoming the coverage of choice for healthcare consumers struggling to pay medical bills in full. The net effect is that revenues are declining at hospitals, clinical laboratories, and pathology groups, as well as other providers. (Graphic copyright: Consumer Reports.)
In a Modern Healthcare article, Crowe Horwath’s Managing Partner of Healthcare Services, Brian Sanderson, noted, “It’s imperative that healthcare organizations establish effective point-of-service collection programs by training and educating front-line staff.”
Complicating matters is that many patients faced with self-pay are unable to pay their medical bills at time of service.
“Higher deductibles and the increase in patient responsibility are causing a decrease in patient payments to providers for patient care services rendered,” John Yount, TransUnion Vice President for Healthcare Products, told RevCycle Intelligence. “While uncompensated care has declined, it appears to be primarily due to the increased number of individuals with Medicaid and commercial insurance coverage.”
Hospitals Offer Patients Financial Options for Paying Bills
Some hospitals are responding to this trend by rolling out programs that offer patients financing options for their out-of-pocket costs. A recent article in Modern Healthcare outlined the steps taken by Missouri hospital system Mosaic Life Care, as it realized the full impact that $23 million worth of self-pay patient care had on its bottom line. Though the hospital posted record census and gross revenue during the first four months of 2017, net revenue was flat because patient self-pay didn’t keep pace.
“We win all kinds of awards for patient quality, but our revenue cycle didn’t match that performance,” Deborah Vancleave, Mosaic’s Vice President of Revenue Cycle, told Modern Healthcare.
Since then, Mosaic has taken steps to improve the accuracy of information it gets at registration and how it makes determinations on patients’ ability to pay. In addition, it has joined forces with ClearBalance— a provider of patient loan programs to US hospitals and health systems—to offer zero-interest or low-interest revolving lines of credit to patients for their out-of-pocket medical costs.
According to Modern Healthcare, ClearBalance pays hospitals “upfront for the outstanding bills of patients who sign up for their financing program, but the hospital guarantees the money and repays lenders if patients default on their credit lines. The companies make their profit by getting a 10% to 15% fee for the outstanding amount of the loan.”
Medical Laboratories Slow to Respond to Consumer Demand for Price Transparency
As consumers shoulder more of the burden for their healthcare, they also will be demanding more price transparency from medical laboratories and anatomic pathology groups, which so far have been slow to respond to the trend.
“Patients expect cost estimates in every other retail industry, and are starting to demand them in healthcare as well. According to one recent study, for example, more than 90% of patients felt it was important to know their payment responsibility upfront,” TransUnion, a global risk information provider, stated in a white paper outlining the importance of precare cost estimates.
As hospitals struggle to collect from patients saddled with HDHPs, laboratory executives and other healthcare providers should take note. The change in payment mix means the ability to collect payments from patients at the point of service is becoming a critical success factor.
—Andrea Downing Peck
Related Information:
Hospitals Struggle with the Dilemma of Patients Hit by High Deductibles
Kaiser Family Foundation 2016 Employer Health Benefits Survey
The Impact of Consumerism on Provider Revenues
Patient Financial Responsibility On the Rise
Improve Revenue Cycles and Patient Engagement by Delivering Pre-Care Cost Estimates
68% of Consumers Did Not Pay Patient Financial Responsibility
