News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

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News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel
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Implications of Academia’s Early Adoption of Whole Slide Scanning and Digital Pathology Systems

Understanding requirements of digital pathology workflow matters as regulatory and reimbursement elements align toward wider adoption beyond 2023. Upcoming Dark Daily webinar May 10 to cover infrastructure requirements

Nearly all pathology residents and fellows, as well as many histologists and other medical students, have been trained using digital images and, therefore, digital pathology tools. This resounds as a major and important development now working in tandem with recent coding decisions and regulatory recommendations that may combine to advance digital pathology to a significant tipping point.

As Dark Daily’s sister publication, The Dark Report, has described in great detail over the past several years, the trend toward digital pathology implementation started in the mid-2000s. Much has been learned through trial and error that may make the practical path forward clearer for those still on the sidelines.

Digital pathology infrastructure and information technology (IT) requirements are better known after years of research at academic centers throughout the United States—but only for those closest to the action. Two examples are University of Southern California (USC) on the West Coast and Memorial Sloan Kettering Cancer Center (MSKCC) on the East Coast.

During a free 60-minute educational webinar on May 10, W. Dean Wallace, MD, (far left) of University of Southern California (USC) and Orly Ardon, PhD, MBA, (immediate left) of Memorial Sloan Kettering Cancer Center (MSKCC) will explain digital pathology infrastructure, IT, and lessons learned through firsthand experiences. The webinar is sponsored by Hamamatsu, and continuing education credit is available for listening. (Photo copyrights: USC and MSKCC.)

Seven Advantages of Early Adoption of Whole Slide Imaging and Digital Pathology

Many pathologists know that academic centers throughout the U.S. have been the first to adopt and use digital pathology scanners and systems. Early work in what have become custom digital pathology ecosystems has enabled academic pathology groups to:

  • Learn how to implement, validate, and design workflows that include digital pathology systems and computational pathology.
  • Determine how physical environments need to change for slide scanners, achieving quality images, maximizing scanner utility, and expanding scanning capabilities in medium- and high-throughput laboratories.
  • Contract with pharmaceutical companies and drug developers to read digital images in support of drug research and clinical trials.
  • Understand how digital pathology applies for various use cases, including primary diagnosis, frozen section diagnosis, consultations, second opinions, and telepathology.
  • Successfully spread pathologist technical and professional support across multiple laboratory locations and remote customers.
  • Learn best practices for conducting tumor boards and peer reviews of pathology cases.
  • Validate and verify new hematoxylin and eosin (H&E) stains.

Hospital and Lab Leaders Have Questions About Digital Pathology Requirements

As a result of early adopter projects, digital pathology infrastructure and IT requirements are better understood and documented for a variety of use cases, according to W. Dean Wallace, MD, Professor of Pathology at the Keck School of Medicine of USC. Wallace specializes in pulmonary and renal pathology with a strong interest in informatics, as well as radiology and pathology correlation, and he warns of the danger of implementing an “incomplete digital pathology system.”

Wallace will join Dark Daily for a 60-minute webinar, “Digital Pathology Implementation Strategies,” on Wednesday, May 10, at 1 p.m. Eastern. Registration is free.

This webinar is for hospital and health system leaders, as well as independent pathology groups and reference lab executives, who want to know:

  • Key workflow aspects of the components needed in a digital pathology service.
  • Common limitations of commercial digital pathology products.
  • How to structure a digital pathology implementation team.
  • A goal-based approach to developing a business case for digital pathology implementation.

Wallace and Orly Ardon, PhD, MBA, Director of Digital Pathology Operations at MSKCC, will lead the call and take questions during the webinar’s live Q&A segment.

Questions About Digital Pathology Implementation

At MSKCC, teams have scanned and archived more than six million histology slides and are prospectively scanning all in-house H&E slides.

“There is a lot of interest out there for digital pathology implementation,” Ardon told Dark Daily, “not only the AI-machine learning opportunities that are enabled with digital slides, but how do we even start a basic digital pathology journey. Institutions and labs don’t realize how many factors they have to think about before they start scanning the first slide.”

“People have limited understanding of the complexities of the business case,” Wallace added. “Do you want to go with a full 100% deployment or a targeted deployment? Do you want to get digital pathology to support tumor boards? By introducing scanners into the tumor board workflow, you can actually cause more problems than you are solving if you are not careful.

“The other aspect of it is the actual technical deployments. You need to begin with careful analysis of functions or services to support,” Wallace said, adding the soft costs of digital pathology can take lab and pathology administrators by surprise.

Ardon and Wallace will present their insights and experiences during the webinar, which has been sponsored by Hamamatsu. Those interested can learn more and register at Dark Daily here. P.A.C.E. credit is available for this program through the American Society for Clinical Laboratory Science (ASCLS).

On the Horizon: Incentives and Further Alignment Toward Digital Pathology Adoption

Dark Daily’s new webinar is timely. Earlier this year, the Centers for Medicare and Medicaid Services (CMS) entered what has been called a “tryout” period to gather data about the use of new, digital-pathology-related Current Procedural Terminology (CPT) codes in clinical laboratories and anatomic pathology groups. (See coverage in The Dark Report.)

Some believe the efforts of CMS, clinical labs, and pathology groups will result in new reimbursable codes, reimbursement values, and other incentives for using digital pathology (starting sometime in 2024)—if analysis shows use of digital pathology is as widespread as numerous publications would seem to indicate.

The CPT coding development coincides with recent discussions within the federal Clinical Laboratory Improvement Advisory Committee (CLIAC) about sweeping recommendations to allow continued remote work once the COVID-19 Public Health Emergency ends on May 11 and recognize digital data as a vital component of diagnostic specimens. (See coverage in The Dark Report.)

CLIAC’s recommendations may translate into a running start for modernizing the Clinical Laboratory Improvement Amendments of 1988 (CLIA). CLIA as it is written currently is dated and needs to account for new and emerging technologies, such as digital pathology, medical laboratory industry sources have said for years. (See a recent Dark ReportDark Daily webinar.)

These developments, as they further align with actions by the U.S. Food and Drug Administration (FDA), could unleash swells of interest in onboarding whole slide scanners and digital pathology tools. Remote workflows became a priority during the COVID-19 pandemic, and it appears they will continue for a period as the Public Health Emergency unwinds, according to the FDA.

Watch Digital Pathology Implementation Strategies

Most executives at hospitals and health systems, private pathology practices, and independent reference labs are on the sidelines watching how digital pathology in research and clinical practice is unfolding.

However, as the pathology field integrates data science and computational pathology, forward-looking hospital and lab leaders can expect greater momentum toward advanced technologies, such as digital pathology tools.

Register here to participate in the upcoming webinar, “Digital Pathology Implementation Strategies.”

—Liz Carey

This content was developed through independent research and interviews by The Dark Intelligence Group, with support from Hamamatsu Photonics K.K., a provider of whole slide imaging systems and related technology such as optical sensors, light sources, and complex instrument systems that use them. Hamamatsu did not participate in the article’s development. Learn more about Hamamatsu at

Related Information

Dark Daily Webinar: Digital Pathology Implementation Strategies

Three Clinical Laboratory Trends Not to Misjudge

Shortage of Pathologists a Factor in Adoption of Digital Pathology

CLIA on Path to Recognize Lab Data as a Specimen

Use Histology Data to Illustrate Specimen “Life Cycle

New CPT Codes Debut for Digital Pathology Services

Digital Pathology Implementation Strategies

Digital Pathology Implementation Strategies

digital pathology webinar

As reimbursement for digital pathology services starts to potentially become a reality, more hospital, clinical laboratory, and reference lab leaders will explore the technology.

Do you know where to start with implementing a digital pathology program for your hospital, health system, or independent pathology group to make the best use of your budget? “Digital Pathology Implementation Strategies,hosted by Dark Daily and sponsored by Hamamatsu, aired May 10, 2023, and is now available for free streaming.

Pathologists, hospital executives, and lab leaders need help cutting through frequently published news and commentary about digital pathology. They will find this new webinar practical and incisive for gaining a foothold on what to do for digital pathology should regulatory and reimbursement decisions rapidly evolve in favor of greater digital pathology adoption in the U.S.

Pathology is in a time of rapid change. Use this free, 60-minute Dark Daily webinar as a practical update and an essential tool.

Meet the Experts

Dean Wallace, MD, Professor of Pathology, Keck School of Medicine W. Dean Wallace, MD, is a Professor of Pathology at the Keck School of Medicine at University of Southern California (USC). Dr. Wallace’s ongoing work in informatics and digital pathology includes collaborative efforts in radiology and pathology correlation and implementation of digital pathology into standard pathology practice workflows. Other areas of research include creation of novel pathology staining techniques using machine learning technology.

Orly Ardon, PhD, MBA, Memorial Sloan Kettering Cancer Center Orly Ardon, PhD, MBA, is the Director of Digital Pathology Operations at Memorial Sloan Kettering Cancer Center’s Pathology Department and the Scientific Operations Investigator at the Warren Alpert Center for Digital and Computational Pathology. Dr. Ardon is leading the digital scanning team and operations of the different scanning initiatives and collaborations at MSKCC. Her research interests include digital pathology technologies, laboratory process improvements, and healthcare economics.

Key Learnings

• Understand key workflow aspects of the components needed in a digital pathology service
• Gain an understanding of common limitations of commercial digital pathology products
• Clarify how to structure your digital pathology implementation team
• Learn a goal-based approach to develop your business case for digital pathology implementation in hospitals, health systems, and independent pathology groups

Sponsored by

Digital Pathology Implementation

Post-Pandemic Strategies for Labs Include OIG Audit Prep and Repurposed Instruments

Some lab experts advise that clinical laboratories and pathology practices should also plan on delayed payments for COVID-19 testing for uninsured patients

Regardless of whether infection rates for SARS-CoV-2 continue to wane or perhaps surge again, business changes are coming for staff at clinical laboratories and anatomic pathology groups. Forward-thinking lab administrators will want to evaluate post-pandemic strategies for labs to stay ahead of potential legal issues and keep their organizations financially healthy.

The public health emergency stemming from COVID-19 is set to expire April 16. That deadline could be extended. However, the U.S. Department of Health and Human Services (HHS) is under pressure from some circles to end the public health emergency, which would affect some health insurance provisions and potentially rein in relaxed rules for telemedicine.

“If you’re a laboratory, now is the time you need to start buttoning up [the above] concerns. You don’t want to be at the mercy of a quick cutoff,” said Jon Harol, president of Lighthouse Lab Services in Charlotte, N.C. The company hosted a webinar last week called “Preparing Your Clinical Lab or Pathology Practice for Post-COVID Success.”

Pathologists and clinical laboratory leaders should consider post-pandemic strategies for labs in the following areas:

  • COVID-19 testing for uninsured patients;
  • Preparations for government audits of SARS-CoV-2 tests performed during the pandemic; and,
  • Repurposing PCR equipment used for COVID-19 testing into other areas of clinical diagnostics.

These strategies will be explored further during the Executive War College Conference on Laboratory and Pathology Management, which takes place April 27-29 in New Orleans. Leaders of innovative clinical laboratories will share how their lab teams are helping to improve patient outcomes while encouraging health insurers to pay them for this value.

COVID-19 Testing for Uninsured Patients

On March 22, the U.S. Health Resources and Services Administration (HRSA) announced that its COVID-19 Uninsured Program stopped accepting claims for testing and treatment due to lack of sufficient funds. This development affects 8.6% of the nation’s population that doesn’t have medical insurance, according to the U.S. Census Bureau.

For clinical laboratories, the announcement could lead to delayed payments for COVID-19 tests performed on uninsured patients, said Mick Raich, President of Revenue Cycle Management Consulting at Lighthouse Lab Services, who also spoke during the webinar. Medical laboratories and pathology groups should anticipate reimbursement gaps and how that might affect revenues collected from payers.

Jon Harol, president, Lighthouse Lab Services
“The patient relationship is going to be the most important thing. That puts labs at the head of the table,” says Jon Harol, president at Lighthouse Lab Services.

“Labs are going to do the testing and are going to bill for it, and there will probably be some retroactive payment,” Raich explained.

With midterm elections happening this year, don’t be surprised to see HRSA funding reinstated for COVID-19 testing for uninsured people, commented Robert Michel, Editor-in-Chief of The Dark Report and Founder of the Executive War College.

“We’ll have to wait and see. After all, it is an election year, so the representatives and senators in Congress would like to be re-elected,” added Michel, who also presented during the webinar.

“It is reasonable to assume that members of Congress don’t want to disappoint the clinical laboratories that stepped up to the table in the earliest days of the pandemic and have done huge volumes of COVID-19 testing.”

Preparations for Government Audits of Pandemic Testing

Another post-pandemic strategy for labs: Prepare for audits of COVID-19 test claims from the HHS Office of Inspector General (OIG).

The OIG has already stated it will begin to review HRSA claims for testing of uninsured patients to verify that, in fact, those people were not covered by Medicare or a private payer.

Ahead of any OIG action, labs should consider performing self-audits to determine whether they complied with HRSA requirements. “The best thing you can do is go back and look at the first two months of your billing. Do an audit to ask: Did we bill anybody with insurance by accident?” Raich suggested. “Take a hundred of those claims and audit them.”

If a medical lab finds problems with uninsured COVID-19 billing, it may be prudent to self-report those discrepancies to the government rather than ignore them. “That looks a lot better to the OIG than tucking the stuff in a desk drawer and waiting for someone to knock on your door,” Raich noted.

Harol predicted the OIG will also review another aspect of how COVID-19 test claims were coded. Auditors will want to see if PCR test claims coded for higher reimbursement if the results were reported within 48 hours actually met that requirement.

“I expect that we’ll see auditing of the coding that was used. Under COVID, you got paid more if you were running tests on a high-throughput platform. It was almost an honor system there. I don’t know that I’ve seen much outside verification of that,” Harol explained. “I’m curious to see if there will be OIG pushback and more documentation required to prove the code was correct.”

Repurposing PCR Equipment Used for COVID-19 Testing

When the pandemic finally winds down, there will be less demand for COVID-19 testing, which could leave PCR equipment collecting dust unless labs make plans now on how to repurpose those systems.

“If you have a PCR instrument that can be revalidated, you want to start thinking about putting in a panel that tests for UTIs, sexually transmitted diseases, respiratory diseases, or women’s health,” Harol explained. “Those types of tests can be done on the equipment that a lot of COVID testing was being performed on, and it can be performed by the same scientists with that same skillset. That’s the low-hanging fruit.”

The next step is more complicated: Moving into the future, clinical laboratories need to determine what menu of tests will meet the needs of patients who previously submitted COVID-19 specimens for testing.

“The patient relationship is going to be the most important thing. That puts labs at the head of the table,” Harol continued. “How can you market your laboratory services directly to patients who might be interested?”

Watch for Developments in Telemedicine

Any post-pandemic strategies for labs will be influenced by how state governments and federal health officials regulate telemedicine in the future.

Telemedicine rules affect pathologists who work on digital pathology systems given those platforms enable slides to be reviewed from any location.

Pathologists and clinical laboratory directors should keep their eyes on whether telemedicine rules revert to more onerous requirements once the public health emergency lifts. Before the pandemic, rules for physicians licensed in one state generally limited when they could practice over state lines through telemedicine.

“In response to the pandemic, both the federal government and the states relaxed many prohibitions on the practice of medicine across state lines. This is significant for pathologists,” Michel said. “There is speculation that once government officials let this genie out of the bottle regulatory-wise, they won’t be able to put it back in. Thus, there are many predictions that officials at the state and federal level will be under pressure to retain the newer telemedicine rules after the pandemic has ended.”

Telemedicine proved to be a big benefit for Medicare patients during the pandemic. A report from HHS in December indicated telehealth visits in 2020 for Medicare beneficiaries increased 63 times, from approximately 840,000 in 2019 to 52.7 million. That fact should catch the attention of clinical lab managers and pathologists who want to keep their labs at the front edge of clinical services. For Medicare beneficiaries who see their physicians virtually, labs need the capability to access that patient so as to collect the samples needed to perform those tests ordered by the physician during the telehealth consultation.

—Scott Wallask

Related Information:

On-Demand Webinar: Preparing Your Clinical Lab or Pathology Practice for Post-COVID Success

Executive War College Conference on Laboratory and Pathology Management

HRSA updates about Provider Relief Fund

Audit of Health Resources and Services Administration’s COVID-19 Uninsured Program

Telemedicine Gaining Momentum in US as Large Employers Look for Ways to Decrease Costs; Trend Has Implications for Pathology Groups and Medical Laboratories

US Government Purchases 150 Million COVID-19 Antigen Tests from Abbott Laboratories for $760 Million; Only CLIA-Certified Clinical Laboratories Can Do Testing

Abbott sends the SARS-CoV-2 test results directly to patients’ smartphones, which can be displayed to gain entrance into areas requiring proof of COVID-19 testing

There is no greater example that COVID-19 is a major force for change in the clinical laboratory industry than the fact that—though the US federal government pays 50% of the nation’s total annual healthcare spend of $3.5 trillion—it recently spent $760 million to purchase 150 million COVID-19 tests from Abbott Laboratories (NYSE:ABT), an American multinational medical devices and healthcare company headquartered in Abbott Park, Ill., “to expand strategic, evidence-based testing in the United States,” according to the company’s website.

In August, the federal Food and Drug Administration (FDA) granted an emergency use authorization (EUA) to Abbott for its BinaxNOW portable rapid-response COVID-19 antigen (Ag) test. The credit-card sized test costs $5 and can return clinical laboratory test results in minutes, rather than hours, days, or in some cases, weeks, the Wall Street Journal (WSJ) reported.

The test includes a free smartphone app called NAVICA, which enables those tested to receive their test results directly on their mobile devices—bypassing the patient’s primary care physicians.

According to Abbott’s website, the app “allows people who test negative to get an encrypted temporary digital NAVICA Pass, similar to an airline boarding pass. NAVICA-enabled organizations will be able to verify an individual’s negative COVID-19 test results by scanning the individual’s digital NAVICA Pass to facilitate entry into facilities.”

This feature of Abbott’s new COVID-19 test is a good example of how quickly innovation in the medical laboratory testing profession is bringing new features and new capabilities to the marketplace. By marrying the SARS-CoV-2 test with the NAVICA Pass feature, Abbott hopes to deliver increased value—not just to physicians and their patients—but also to employers with employee screening programs and federal government programs designed to screen federal employees, as well as being used for screening travelers at airports and other transportation hubs.

Abbott appears to be banking that in the future such identification will be required to “enter organizations and other places where people gather,” as the company’s website states.

Testing Limited to CLIA-Certified Clinical Laboratories

An HHS news release announcing the government’s planned distribution of the BinaxNOW tests stated that “Testing will be potentially deployed to schools and to assist with serving other special needs populations.”

In the news release, Alex Azar, HHS Secretary, said, “By strategically distributing 150 million of these tests to where they’re needed most, we can track the virus like never before and protect millions of Americans at risk in especially vulnerable situations.”

The EUA adds that “Testing of nasal swab specimens using [BinaxNOW] … is limited to laboratories certified under CLIA that meet the requirements to perform high, moderate, or waived complexity tests. This test is authorized for use at the [point of care], i.e., in patient care settings operating under a CLIA Certificate of Waiver, Certificate of Compliance, or Certificate of Accreditation.”

The FDA’s EUA describes the BinaxNOW portable rapid-response COVID-19 antigen test (above) as “a lateral flow immunoassay intended for the qualitative detection of nucleocapsid protein antigen from SARS-CoV-2 in direct nasal swabs from individuals suspected of COVID-19 by their healthcare provider within the first seven days of symptom onset.” The test costs $5 and Abbott sends results directly to the patient’s smartphone using the free NAVICA app included with the test. (Photo copyright: Abbott Laboratories.)

IVD Companies See Boom in COVID-19 Test Sales

Demand for COVID-19 testing has created opportunities for in vitro diagnostics (IVD) companies that can develop and bring tests to market quickly. 

Recent issues of Dark Daily’s sister print publication—The Dark Report (TDR)—covered IVD companies’ second quarter (Q2) boom in sales of COVID-19 instruments and tests, while also noting a fall-off in routine clinical laboratory testing during the COVID-19 pandemic. 

Abbott Laboratories saw molecular diagnostics sales increase 241% in Q2 driven by $283 million in sales of COVID-19 testing, while rapid diagnostic COVID-19 testing rose 11% on $180 million in sales in Q2, TDR reported, based on Abbott data.

“There is huge economic incentive for diagnostic companies to develop technologies that can be used to create rapid tests that are cheap to perform,” said Robert Michel, Publisher and Editor-in-Chief of TDR and Dark Daily. “In this sense, COVID is a major force for change.”

“This new COVID-19 antigen test is an important addition to available tests because the results can be read in minutes, right off the testing card,” said Jeff Shuren, MD, JD (above), Director of the FDA’s Center for Devices and Radiological Health (CDRH), in an FDA news release announcing the federal government’s $760 million purchase of 150 million Abbott BinaxNOW rapid-response antigen COVID-19 tests. “This means people will know if they have the virus in almost real-time. Due to its simpler design and the large number of tests the company anticipates making in the coming months, this new antigen test is an important advancement in our fight against the pandemic.” (Photo copyright: The New York Times.)

Abbott Invests in Proving BinaxNOW’s Capabilities

Abbott has a lot riding on the BinaxNOW test. Its portable, rapid molecular ID NOW COVID-19 test was touted by President Trump during a White House press briefing in March as “a whole new ballgame.” But then, researchers at New York University (NYU) published study data that questioned the accuracy and reliability of the test, which Dark Daily covered in “Abbott Labs’ ID NOW COVID-19 Rapid Molecular Test Continues to Face Scrutiny Over False Negatives.”

Thus, Abbott is determined to ensure this product launch is successful and that the test works as promised. According to a news release, “In data submitted to the FDA from a clinical study conducted by Abbott with several leading US research universities, the BinaxNOW COVID-19 Ag Card demonstrated sensitivity of 97.1% (positive percent agreement) and specificity of 98.5% (negative percent agreement) in patients suspected of COVID-19 by their healthcare provider within the first seven days of symptom onset.”

“The massive scale of this test and app will allow tens of millions of people to have access to rapid and reliable testing,” said Joseph Petrosino, PhD, professor and chairman, Molecular Virology and Microbiology, Baylor College of Medicine, in the Abbott news release. “With lab-based tests, you get excellent sensitivity but might have to wait days or longer to get the results. With a rapid antigen test, you get a result right away, getting infectious people off the streets and into quarantine so they don’t spread the virus.”

Abbott has invested hundreds of millions of dollars in two manufacturing facilities where the tests will be made, John Hackett Jr, PhD, an immunologist and Abbott’s Divisional Vice President Applied Research and Technology, and lead scientist on the BinaxNOW project, told The Atlantic.

“Our nation’s frontline healthcare workers and clinical laboratory personnel have been under siege since the onset of this pandemic,” said Charles Chiu, MD, PhD, professor of Laboratory Medicine at University of California, San Francisco, in the Abbott news release. “The availability of rapid testing for COVID-19 will help support overburdened laboratories, accelerate turnaround times, and greatly expand access to people who need it.”

However, other experts are not so sure. In the Atlantic article, Michael Mina MD, PhD, Assistant Professor Epidemiology at Harvard’s T.H. Chan School of Public Health, voiced the need to test both asymptomatic and pre-symptomatic people. “This is the type of [COVID-19] test we have been waiting for—but may not be the test.”

Nevertheless, the federal government’s investment is significant. Abbott plans to start shipping tens of millions of tests in September and produce 50 million tests per month starting in October, Forbes reported.

Shifting Clinical Laboratory Paradigms

BinaxNOW will be performed without doctors’ orders, in a variety of locations, and results go directly to patients’ smartphone—without a pathologist’s interpretation and medical laboratory report. This is new ground and the impact on non-CLIA labs, and on healthcare in general, is yet to be seen.

Clinical laboratory managers will want to monitor the rise of rapid-response tests that can be easily accessed, conducted, and reported on without physician input. 

—Donna Marie Pocius

Related Information:

Trump Administration Will Deploy 150 Million Rapid Tests in 2020

In Vitro Diagnostics Firms Report Boom in Sales of COVID-19 Instruments, Tests

FDA Authorizes First Diagnostic Test Where Results Can Be Read Directly from Testing Card

Abbott’s Fast, $5, 15-Minute Easy-to-Use COVID-19 Antigen Test Receives FDA Emergency Use Authorization; Mobile App Displays Test Results to Help Our Return to Daily Life; Ramping Production to 50 Million Tests a Month

Performance of the Rapid Nucleic Acid Amplification by Abbott ID NOW COVID-19 in Nasopharyngeal Swabs Transported in Viral Media and Dry Nasal Swabs, in a New York City Academic Institution

Trump to Announce Deal with Abbott Laboratories for 150 Million Rapid COVID-19 Tests

Abbott Labs’ ID NOW COVID-19 Rapid Molecular Test Continues to Face Scrutiny Over False Negatives

Abbott Provides Update on ID NOW

A New Era of Coronavirus Testing is About to Begin

U.S. Approves Abbott Labs’ $5 Mass-Scale COVID-19 Test

Repositioning the Clinical Laboratory as a Strategic Pillar of the Value-Based Healthcare Organization, Consistent with Clinical Lab 2.0

Panel of experts in healthcare and the clinical laboratory market identify key trends and discuss how innovative medical laboratories are adding value—and getting paid for that value

Effective clinical laboratory leadership in today’s value-based healthcare system means demonstrating value within an integrated delivery network. After all, as fee-for-service payment for clinical lab tests gives way to value-added reimbursement arrangements, all medical laboratories will need to justify their share of a value-based payment.

But how can clinical laboratories alert physicians and their parent hospitals to the real value they offer to improve patient outcomes and reduce healthcare costs? Though lab leaders may understand their medical lab’s complexity, accessibility, and impact, the question is how to direct the effort. The answer lies in a risk that some laboratory directors may not have considered.

Value-based healthcare systems include hospital-based medical laboratories as an essential part of their integrated health system. And, to lower the cost of care, healthcare systems involved in value-based care know they must become better at coordinating care and offering precision medicine services to their patients.

Year-by-year, more integrated health systems are learning how to eliminate gaps in care and become more proactive in delivering care that helps keep patients healthy. However, the task of leveraging the clinical laboratory in a strategic approach to demonstrating value in those health systems remains daunting. One of the goals of the Clinical Lab 2.0 model developed by the Project Santa Fe Foundation clinical laboratory organization is to demonstrate how labs can achieve two goals:

  • Create added-value services that improve patient care; and
  • Have health insurers, accountable care organizations (ACOs), and health networks pay remuneration to the clinical labs for those added-value services.

Pathologists, Clinical Chemists, and MTs Leave Thy Medical Labs

Expert panelists of a recent webinar hosted by Dark Daily and sponsored by Sunquest Information Systems suggested ways that clinical laboratories could better position themselves to be an asset for their organizations. One way to do this is to get their clinical pathologists, PhDs, and medical technologists out of the lab and engaged with physicians, nurses, and other clinical staff in specific ways that influence the healthcare organization’s overall performance in delivering better patient outcomes at less cost.

“If your pathologists aren’t sitting on the medical informatics committee or the clinical quality-improvement committee or any one of the myriad things at the enterprise level, that’s going to be a risk for you,” said Michael J. Crossey, MD, PhD, CEO and Chief Medical Officer for TriCore Reference Laboratories, during the webinar “Listen, Learn, Lead: Uncover Ways You Can Position Your Lab as a Strategic Pillar of the Healthcare Organization.” 

“Our labs have to be equal partners instead of recipients of where things are going,” he stressed. “We need to be, if not in the driver’s seat, at least in the front seat.”

The expert webinar panelists included:

Mark Dixon (above), President of the Mark Dixon Group LLC, moderated the webinar, which was sponsored by Sunquest Information Systems  and The Dark Report, sister publication of Dark Daily. Dixon has more than 30-years’ experience as a health system CEO and COO. He said TriCore and other labs are succeeding at value-based healthcare using methods that are well-defined and available for all clinical laboratories to learn. For example: TriCore has found that certain health insurers are willing to not only pay their laboratory differently, but also meet with the lab’s pathologists and leaders to negotiate value-based care arrangements. (Photo copyright: Mark Dixon Group.)

Fundamental Changes That Will Impact All Clinical Laboratories

The panel speakers discussed how clinical laboratories can strategically position themselves to be successful in today’s evolving healthcare industry. They predicted several fundamental changes would take place or continue. These changes include:

  • A continued shift away from pure fee-for-service payment (volume) to value-based reimbursement that rewards improved patient outcomes;
  • More discussion regarding prevention of illnesses, chronic diseases, and personal responsibility;
  • More focus on primary care and proactive care;
  • Rapid advances in science and technology that will spark development of new healthcare applications;
  • Continued trend toward consumerism, as more patients pay a larger portion of their healthcare expenses and shop for hospitals, doctors, and labs; and
  • Intense cost pressure on healthcare organizations and their medical laboratories.

It was noted during the panel discussion that, even as the US spends more than any other country in the world on healthcare, it has some of the worst overall outcomes.

Customers Rapidly Becoming Stakeholders

“I always think in terms of stakeholders and the number one stakeholder for any clinical laboratory or healthcare system is always the customer,” said Peters. “The lab’s customer is the ordering physician. So, it’s important that labs ‘speak their language’ and understand that the physician’s customer is the patient.”

Clinical laboratories also must be aware of what a particular healthcare system is trying to accomplish. “Lab leaders should stay in constant touch with where the market is, where the system is, and where reform is,” said Oravetz. “And realize there are things that can be done today to set up for what’s coming tomorrow.”

Terese said that for a clinical laboratory to survive during this rapid transformation of the US healthcare system—or at least continue to thrive—it needs to engage with the strategic and clinical initiatives guiding every health system around the country. “There is tremendous opportunity for clinical laboratories to not only support that transition, but to actually help drive it,” he said. “There’s nothing wrong with thinking of your medical laboratory as a leader of these initiatives, versus just as a follower of what the organization is doing.”

Key elements of the webinar that will be of interest to clinical laboratories include:

  • Examples of clinical laboratories navigating the transition from volume to value-based care;
  • Discussion and update on fundamental changes coming to the US healthcare industry that impact clinical laboratories;
  • The case for demonstrating the value of clinical labs to healthcare organizations; and
  • Eight ways to elevate the value of clinical labs within an integrated healthcare network.

The experts on this special discussion panel agree that US healthcare and the clinical laboratory marketplace is in a time of transition. Pathologists and medical laboratory scientists have an opportunity to position themselves as leaders and changemakers to the benefit of patients, as well as their parent hospitals and health networks.

This free webinar can be a critical tool for leadership training within every clinical laboratory. It can be used to give lab managers and lab staff fresh insights into the changes happening in healthcare. Insights that can guide strategic planning and inspire laboratory-led projects to collaborate with physicians and improve patient care.

Download this webinar for free by clicking here. (Or, copy and paste this URL into your browser:

—JP Schlingman

Related Information:

Free On-Demand Webinar: Listen, Learn, Lead: Uncover Ways You Can Position Your Lab as a Strategic Pillar of the Healthcare Organization

Ochsner Accountable Care Network Recognized Nationally for Quality and Efficiency

Defining Value—The Foundation of Outcomes-Based Risk-Sharing Agreements

Value-Based Contracts with Risk 3 to 5 Years Away for Providers

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Many Hospital Laboratories Must Report PAMA Private Payer Clinical Lab Test Price Data as ‘Applicable Labs’ in 2019, But Lack Systems and Expertise for This Task

Medicare officials are including most hospital laboratories in this PAMA data reporting cycle, but hospitals face $10,000/day federal penalties for not filing, filing late, or filing incomplete or inaccurate data

Clinical laboratories operated by hospitals and health systems could prove to be a game changer for the lab industry in this upcoming PAMA private payer lab test price reporting cycle. But that upside comes with risk.

For this reporting period, the federal Centers for Medicare and Medicaid Services (CMS) has defined any hospital laboratory that uses the CMS 1450 14X to bill for Medicare Part B clinical laboratory tests as an “applicable laboratory” under the Protecting Access to Medicare Act of 2014 (PAMA). That means a majority of hospital labs in the United States are required to report the prices they were paid by private health insurers to CMS.

This makes the current PAMA reporting period a high-stakes endeavor, because unprepared clinical laboratories could face federal fines of $10,000/day. The reporting eligibility requirements are broad and may leave unprepared clinical laboratories at significant risk.

The CMS PAMA regulations page states:

“Under the final rule, laboratories, including physician office laboratories, are required to report private [payer] rate and volume data if they:

  • “Have more than $12,500 in Medicare revenues from laboratory services on the CLFS [Clinical Laboratory Fee Schedule]; and,
  • “Receive more than 50% of their Medicare revenues from laboratory and physician services during a data collection period.

“Laboratories will collect private [payer] data from January 1, 2019, through June 30, 2019, and report it to CMS by March 31, 2020.”

In addition to shrinking margins, increased competition, reduced reimbursement rates, and ever-changing regulations, clinical laboratories now face new fines that could prove financially catastrophic for even the largest, most efficient labs.

New Rules and Reporting Requirements Threaten Unprepared Labs

Healthcare reform continues to reshape how healthcare is both delivered and billed across the country. GenomeWeb reported in 2017 that CMS expects PAMA to save the government $3.93 billion by 2028.

While medical laboratories continue to grapple with the impact of reduced reimbursement rates under PAMA’s revised CLFS final rule, the new rules for what constitutes an “applicable lab” and the new reporting requirements that started January 1, 2019, add yet another level of complexity to reporting and compliance concerns.

Rodney Forsman, Assistant Professor Emeritus of Lab Medicine and Pathology at the Mayo Clinic College of Medicine, in Rochester, MN, told Dark Daily that “Laboratories must work to identify reporting concerns, billing and IT limitations, and identify current statutes and limitations to present to compliance officers and stakeholders. Failure to do so could leave labs liable for fines of up to $10,000 per day.”

Compliance Will Be a Team Effort

He further emphasizes that compliance with reporting requirements will involve a range of stakeholders within the hospital and its laboratory. Information technology (IT) teams, compliance officers, laboratory C-suite executives, and billing departments all will play a role in implementing the changes needed and reporting the data required.

Therefore, understanding exactly what regulations require—and what is at stake—is crucial to not only implement critical changes, but to ensure that the lab understands and is on-board with said changes.

Considerations include:

  • Understanding the new collection and reporting periods;
  • Assessing billing and IT limitations in relation to reporting requirements; and,
  • Implementing proper data capture and validation systems ahead of data submission.

To help hospital laboratories, independent clinical laboratories, and stakeholders prepare for these recently enacted requirements and avoid substantial fines, Forsman and Brian Kemp, Vice President of Change Healthcare, headquartered in Nashville, TN, will co-present a 90-minute webinar, titled, “PAMA in 2019: What Labs Need to Know to Collect Data, Report on Time, and Avoid $10,000 per Day Penalties.”

Rodney Forsman (left), Assistant Professor Emeritus of Lab Medicine and Pathology at the Mayo Clinic College of Medicine, and Brian Kemp (right), Vice President of Change Healthcare, stress that a current understanding of PAMA’s impact is crucial and that clinical laboratories are at considerable risk if they are not compliant with the latest PAMA requirements. (Photo copyright: Dark Daily.)

This important webinar will include:

  • A brief overview of PAMA;
  • The latest updates to PAMA reporting requirements; and,
  • Actionable information for applicable labs required to meet them.

The speakers will also cover concerns for hospital outreach programs and specific CMS 1450 14X Type of Bill (TOB) billing changes to help hospital COOs, CFOs, CIOs, contract officers, and compliance officers understand the latest implications of ongoing PAMA requirements.

Laboratory directors, managers, administrators, and IT and billing staff will want to attend this critical webinar to learn essential PAMA reporting considerations and pitfalls to avoid.

(To register for this critical Feb. 20th webinar, click here. Or, copy and paste this URL into your browser:

—Jon Stone

Related Information:

PAMA in 2019: What Labs Need to Know to Collect Data, Report on Time and Avoid $10,000 per day Penalties

PAMA’s Impact on Laboratory Margins

PAMA and Bundled Payments Force Labs to Feel a Reimbursement Shift

CMS 2018 PAMA Pricing Cut for Lab Tests Deeper than Prior Estimate; Advanced Dx Lab Tests Fare Well

Laboratories Take Aim at Proposed PAMA 2018 Medicare Rates for Tests

2018 Medicare Payment Cuts for Clinical Testing

Hospitals Need to Be Aware of CMS Changes to PAMA

CMS Issues PAMA Final Rule That Aims to Cut Medicare’s Clinical Laboratory Test Price Schedule Sharply Beginning in 2018

PAMA Reporting Penalties Can Be Substantial for Laboratories