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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Clinical Laboratory Conferences Continue to Tackle COVID-19 Protocols to Put Attendees at Ease

Proof of vaccination, masking, and availability of on-site testing will continue to be measures taken at in-person events for pathologists and medical laboratory professionals

Organizers of in-person clinical laboratory conferences face an interesting dilemma as they plan events in 2022: Where do they draw the line with COVID-19 safety protocols?

On one hand, the surge of cases caused by the SARS-CoV-2 Omicron variant seems to be in its waning stages and large swaths of the population are vaccinated. On the other hand, clinical laboratory and anatomic pathology events want potential registrants to have confidence that it is safe to travel and attend the gatherings.

One lab industry conference producer who happens to be knee-deep in preparing for an in-person meeting this spring is Robert Michel, Editor-in-Chief of The Dark Report and Founder of the 27th Annual Executive War College on Laboratory and Pathology Management. This informative event takes place on April 27-28 in New Orleans and includes COVID-19 protocols to protect attendees.

The CDC chart above shows the daily number of new COVID-19 cases in the US for the six-month period ending Feb. 28, 2022. Clinical laboratory managers should note that the number of new cases is at its lowest level since the Omicron variant showed up early this year.

“It’s important for all those planning to attend this year’s Executive War College to know that screening COVID-19 protocols will be in place to ensure the health and safety of all participants,” Michel noted. “We did a large lab conference in the fall of 2021 that included protocols for COVID-19 and the attendees told us they appreciated the protection provided by those protocols.”

After a significant rise in COVID-19 cases in January 2022 due to the Omicron variant, current daily case levels now are lower than they were six months ago before the new variant hit, according to numbers from the federal Centers for Disease Control and Prevention (CDC).

The in-person 2021 Executive War College, which took place in San Antonio on Nov. 2-3, 2021, followed the CDC’s recommendations:

  • COVID-19 protocols included a daily set of questions and a temperature check for all speakers and attendees before they were allowed to enter the conference area.
  • CLIA-complex rapid PCR COVID-19 tests were available for individuals whose temperature and answers to the screening questions indicated the need for such testing.
  • Attendees used an app to answer the daily screening questions and upload proof of vaccination.

“At last fall’s Executive War College, approximately 400 attendees were screened on each of the three days before entering the conference area and not one rapid COVID-19 test was needed,” Michel said. “Not only is that an outstanding outcome, but a number of attendees also told us they appreciated our efforts to keep them safe and protect their health.”

The 2022 Executive War College will follow the CDC’s updated COVID-19 guidelines, along with any state and local directives in effect as of April 27.

Although 300 attendees were expected at the 2021 Executive War College, 400 registered and participated.

Proof of Vaccination Has Been Required at Other Clinical Lab Industry Events

Organizers of other clinical lab conferences also have dealt with COVID-19 safety protocols. For example, the American Clinical Laboratory Association (ACLA) will hold its annual meeting in Washington, D.C., on March 9. COVID-19-related requirements for attendees will include proof of vaccination uploaded to a vaccine verification vendor and proof of a negative PCR test taken within 72 hours prior to the event.

The annual meeting of the American Society of Clinical Pathology (ASCP) occurs later this year in September in Chicago—too early yet to publish protocols. Last year’s ASCP conference in Boston was a hybrid event, offering both in-person and virtual options. Those who attended in person needed to upload proof of vaccination to a third-party vendor and were required to wear masks. On-site COVID-19 testing was available.

Revived Corporate Travel Could Boost Clinical Laboratory Conferences

The path back to live events across all industries has not been easy given various COVID-19 surges, political divisiveness over masking, frozen corporate travel budgets, and corporate policies banning or limiting employee travel.

Conference organizers throughout the United States universally hope those barriers will lower as 2022 progresses.

“With the fast-spreading Omicron triggering another round of setbacks to start 2022, event planners now are betting on spring to finally mark a turning point for the hard-hit industry,” MarketWatch reported on Feb. 4. “Their hopes hinge on American corporations taking a note from the recovery already under way for domestic air travel for leisure purposes, with the linchpin being a robust revival of trade show attendance and other in-person business gatherings.”

For Michel, offering actionable advice through well-thought-out sessions has been a cornerstone of the content offered each year at the Executive War College. He believes that approach will continue to be the strongest drawing point for clinical laboratory and pathology executives now considering attending the event.

“Our reading of the tea leaves is that across the profession of laboratory medicine, a great many managers, administrators, executives, and pathologists want to return to in-person conferences,” Michel noted. “Registrations for our April event are running ahead of 2019, and people tell us that they recognize the changes in healthcare and the lab marketplace because of the pandemic. They want to understand what’s driving current trends, like greater consumer involvement in lab testing and how to get private payers to reimburse claims for COVID-19 and genetic tests, as well as how a growing number of clinical laboratories are incorporating artificial intelligence solutions in both clinical care settings and lab operations.”

Visit the Executive War College website to see the agenda and to register.

—Scott Wallask

Related Information:

Executive War College

New Lab, Pathology Trends at Executive War College 2021

CDC COVID-19 Guidelines

American Clinical Laboratory Association

American Society for Clinical Pathology

Going live: Event Planners Are Shouldering Big Financial Risks as Corporate America Looks to Schmooze Again This Spring

American Society for Clinical Pathology Website Was Hacked Last Year, Possibly Exposing Credit Card Information of Members and Online Shoppers

Thousands of pathologists and medical technologists may have had their private data stolen, though ASCP investigators did not confirm this as having happened

For a “limited time period” in 2020, the American Society for Clinical Pathology (ASCP) was the target of a cyberattack that “potentially exposed payment card data as it was

being entered” on the ASCP website, according to a letter sent by McDonald Hopkins PLC to then Attorney General of the New Hampshire Department of Justice (DOJ) Gordon MacDonald.

In “World’s Largest Pathologists Association Discloses Credit Card Incident,” Bleeping Computer, an information security and technology news publication, reported that on March 11 of this year, ASCP employees discovered their system had been hacked. They discerned that between March 3, 2020, and November 6, 2020, the attackers had access to personal information being entered on the ASCP website.

Bleeping Computer noted that “[the ASCP’s] member list includes over 100,000 medical laboratory professionals, clinical and anatomic pathologists, residents, and students.”

In a statement, the ASCP said, “We have recently been informed that our e-commerce website was the target of a cybersecurity attack that, for a limited time period, potentially exposed payment card data as it was entered on our website.”

The information that may have been stolen includes data pertaining to individual credit cards, names, credit or debit card numbers, expiration dates, and security codes (CVV) associated with the cards.

“We engaged external forensic investigators and data privacy professionals and conducted a thorough investigation into the incident,” the ASCP said in the statement.

What Type of Cyberattack?

Evidence collected regarding the ASCP data breach indicates the attack was part of a web-skimming assault. This involves installing malicious software, such as Magecart, onto an e-commerce website. The software acts like a credit card skimmer enabling hackers to steal the payment and personal information of customers who are actively inputting data on the attacked website. The data is then sent to remote servers where it is used for identity theft or sold to others.

ASCP says it does not permanently store any of its customers’ payment card data on its servers, Bleeping Computer reported, which greatly reduces the potential risk of data exposure. In addition, the ASCP has implemented extra security measures to prevent similar incidents from happening in the future.

“We resolved the issue that led to the potential exposure on the website. We implemented additional security safeguards to protect against future intrusions. We continue ongoing intensive monitoring of our website, to ensure that it exceeds industry standards to be secure of any malicious activity,” the ASCP said in a statement, Bleeping Computer reported.

Peter-Blum-Group-Product-Manager-Google
In an interview with TechRepublic, Peter Blum (above), Group Product Manager at Google, discussed steps companies can take to proactively manage the threat of Magecart cyberattacks. “The best defense against Magecart attacks is preventing access,” Blum said. “Online companies need a solution that intercepts all of the API [application programming interface] calls your website makes to the browser and blocks access to sensitive data you have not previously authorized. This prevents any malicious script, or any non-critical third-party script, from gaining access to information your customers enter on your website. This same system should also have a monitoring component to alert companies when a third-party attempts to access sensitive information.” (Photo copyright: LinkedIn.)

Federal Rules and Regulations Concerning HIPAA and PHI

The ASCP stated they have no evidence that any customer data was misused after the incident occurred. As of May 14, the organization has not made an official, public statement regarding the situation on their website, but affected individuals and jurisdictions were sent letters to inform them of the data breach.

With over 130,000 current members, Chicago-based ASCP is the largest professional organization for pathologists and clinical laboratory professionals in the world. The organization did not respond to Dark Daily’s inquiries regarding the data breach.

Although no reported violations under the Health Insurance Portability and Accountability Act (HIPAA) occurred in this ASCP data breach, it should be noted that there are rules under HIPAA for data breaches where Protected Health Information (PHI) may have been compromised.

Under the HIPAA Breach Notification Rule, entities that were hacked must perform the following steps:

  • Notify affected individuals within 60 days of the discovery of the breach. Notification should include a brief description of the breach, the types of information that may have been compromised, steps affected individuals should take to protect themselves from potential harm, and a description of what the organization is doing to investigate the breach, mitigate the harm, and prevent further breaches.
  • Hacked entity must inform the Secretary of Health and Human Services (HHS) within 60 days of the breach discovery if 500 or more individuals were affected. For breaches affecting less than 500 people, the breached entity may notify the Secretary of such breaches on an annual basis.
  • For breaches affecting more than 500 individuals, the hacked entity must also provide a notification to prominent media outlets, typically via a press release, that serve the state or jurisdiction.

This breach of credit card information belonging to a sizeable number of pathologists and clinical laboratory professionals using the ASCP website should be a warning to all clinical laboratories and anatomic pathology groups—along with colleges, societies, and associations—that their websites and digital systems can be attacked at any time. As well, clinical laboratory and pathology professionals should be on the alert and take all necessary precautions to minimize the possibility of data breaches.

—JP Schlingman

Related Information:

World’s Largest Pathologists Association Discloses Card Incident

American Society for Clinical Pathology—Incident Notification

ASCP Disclosed Payment Card Web Skimming Incident

Magecart Attack: What It is, How it Works, and How to Prevent It

What is Magecart? How This Hacker Group Steals Payment Card Data

A Deep Dive into Magecart: What Is Magecart?

Compliance Perspectives: State Enforcement Raises Liability Risks of Data Breaches

Three Federal Agencies Warn Healthcare Providers of Pending Ransomware Attacks; Clinical Laboratories Advised to Assess Their Cyberdefenses

University of California San Diego Researchers Demonstrates How Easily Medical Laboratory Systems and Devices Can Be Compromised, Putting Patient Lives at Risk

WannaCry Ransomware Holds Critical Data Hostage Worldwide, Including UK’s National Health Service and Russia’s Interior Ministry

ASCP and CAP Support New Legislation That Bars Surprise Medical Billing

The No Surprises Act, passed as part of the COVID-19 relief package, ensures patients do not receive surprise bills after out-of-network care, including hospital-based physicians such as pathologists

Consumer demand for price transparency in healthcare has been gaining support in Congress after several high-profile cases involving surprise medical billing received widespread reporting. Dark Daily covered many of these cases over the years.

In “Are Clinical Laboratories Prepared to Cope with Outrage Over Surprise Medical Billing? Patient Access Management May Be an Effective Solution,” we reported on how some early-adopter medical labs and pathology groups were using Patient Access Management (PAM) platforms to address new federal transparency policies, change patient expectations about billing, and increase revenue by lowering denial rates.

And in “Balance Billing Under Increased Scrutiny at Both State and Federal Levels: Clinical Laboratory Tests Top List of Surprise Bills Received by Patients,” we reported on how clinical laboratory testing topped the list of the surprise bills received by patients, according to a survey conducted by the National Opinion Research Center (NORC) at the University of Chicago.

Now, after initial opposition and months of legislative wrangling, organizations representing medical laboratories and clinical pathologists have expressed support for new federal legislation that aims to protect patients from surprise medical bills, including for clinical pathology and anatomic pathology services.

The new law Congress passed is known as the No Surprises Act (H.R.3630) and is part of the $900 billion COVID relief and government funding package signed by President Trump on December 27.

“While this legislation is not perfect (no law is), it serves as a compromise where patients ultimately win,” stated the American Society for Clinical Pathology (ASCP) in its ePolicy News publication.

The law addresses the practice of “balance billing,” in which patients receive surprise bills for out-of-network medical services even when they use in-network providers. An ASCP policy statement noted that “a patient (consumer) may receive a bill for an episode of care or service they believed to be in-network and therefore covered by their insurance, but was in fact out-of-network.” This, according to the ASCP, “occurs most often in emergency situations, but specialties like pathology, radiology, and anesthesiology are affected as well.”

Most portions of the No Surprises Act take effect on January 1, 2022. The law prohibits balance billing for emergency care, air ambulance transport, or, in most cases, non-emergency care from in-network providers. Instead, if a patient unknowingly receives services from an out-of-network provider, they are liable only for co-pays and deductibles they would have paid for in-network care.

New Law Bars Pathologists from Balance Billing without Advance Patient Consent

The law permits balance billing under some circumstances, but only if the patient gives advance consent. And some specialties, including pathologists, are barred entirely from balance billing.

The law also establishes a process for determining how healthcare providers are reimbursed when a patient receives out-of-network care. The specifics of that process proved to be a major sticking point for providers. In states that have their own surprise-billing protections, payment will generally be determined by state law. Otherwise, payers and providers have 30 days to negotiate payment. If they can’t agree, payment is determined by an arbiter as part of an independent dispute resolution (IDR) process.

Early Proposal Drew Opposition

An early proposal to prohibit surprise billing drew opposition from a wide range of medical societies, including the ASCP, CAP, and the American Medical Association (AMA).

All were signatories to a July 29, 2020, letter sent to leaders of the US Senate and House of Representatives urging them to hold off from enacting surprise billing protections as part of COVID relief legislation. Though the groups agreed in principle with the need to protect patients from surprise billing, they contended that the proposed legislation leaned too heavily in favor of insurers, an ASCP news release noted.

“Legislative proposals that would dictate a set payment rate for unanticipated out-of-network care are neither market-based nor equitable, and do not account for the myriad inputs that factor into payment negotiations between insurers and providers,” the letter stated. “These proposals will only incentivize insurers to further narrow their provider networks and would also result in a massive financial windfall for insurers. As such, we oppose the setting of a payment rate in statute and are particularly concerned by proposals that would undermine hospitals and front-line caregivers during the COVID-19 pandemic.”

Hospital groups, including the American Hospital Association (AHA), raised similar concerns in a July 30 letter to congressional leaders.

On December 11, leaders of key House and Senate committees announced agreement on a bipartisan draft of the bill that appeared to address these concerns, including establishment of the arbitration process for resolving payment disputes.

However, in a letter sent to the committee chairs and ranking members, the AHA asked for changes in the dispute-resolution provisions, including a prohibition on considering Medicare or Medicaid rates during arbitration. “We are concerned that the IDR process may be skewed if the arbiter is able to consider public payer reimbursement rates, which are well known to be below the cost of providing care,” the association stated. However, legislators agreed to the change after last-minute negotiations.

AHA President and CEO Rick Pollack headshot in suit and tie
“The AHA is pleased that Congress rejected approaches that would impose arbitrary rates on providers, which could have significant consequences far beyond the scope of surprise medical bills and impact access to hospital care,” AHA President and CEO Rick Pollack (above) said in a statement. “We also applaud Congress for rejecting attempts to base rates on public payers.” (Photo copyright: American Hospital Association.)

Dispute Resolution for Pathologists

The CAP also expressed support for the final bill. In a statement, CAP noted that “As the legislation evolved during the 116th Congress, CAP members met with their federal lawmakers to discuss the CAP’s policy priorities.

“Through the CAP’s engagement and collaboration with other physician associations, the legislation improved drastically,” the CAP stated. “Specifically, the CAP lobbied Congress to hold patients harmless, establish a fair reimbursement formula for services provided, deny insurers the ability to dictate payment, create an independent dispute resolution (IDR) process that pathologists can participate in, and require network adequacy standards for health insurers.”

As laboratory testing was identified by thousands of respondents to the University of Chicago survey as the top surprise bill, it is likely that billing and transparency in charges for clinical pathologist and anatomic pathologist will continue to be scrutinized by law makers and healthcare associations.

—Stephen Beale

Related Information:

Detailed Summary of No Surprises Act

H.R.3630 – No Surprises Act

Are Clinical Laboratories Prepared to Cope with Outrage Over Surprise Medical Billing? Patient Access Management May Be an Effective Solution

Balance Billing Under Increased Scrutiny at Both State and Federal Levels; Clinical Laboratory Tests Top List of Surprise Bills Received by Patients

The No Surprises Act: Implications for States

AHA Statement on COVID Relief Package and Government Funding Bill

AHA Letter on No Surprises Act

How the CAP Shaped Surprise Billing Legislation with its Advocacy

Success on Surprise Medical Bills

Congress Curbs Surprise Billing in Omnibus Coronavirus Relief Bill

ASCP Joins AMA on Surprise Billing Letter

ASCP Continues Patient Advocacy Efforts on Surprise Billing Legislation

Surprise Medical Bills Cost Americans Millions. Congress Finally Banned Most of Them

Multiple Pathology and Other Healthcare Organizations Request CDC Include Clinical Laboratory Personnel in First Round of COVID-19 Vaccinations

CAP president maintains medical laboratory staff are ‘indispensable’ in pandemic fight and should be in ‘top tier’ for vaccination

As COVID-19 vaccinations continue to roll out, the College of American Pathologists (CAP) is lobbying for clinical pathologists and medical laboratory staff to be moved up the priority list for vaccinations, stating they are “indispensable” in the pandemic fight.

In a news release, CAP’s President Patrick Godbey, MD, FCAP argued for the early vaccination of laboratory workers, “It is essential that early access to the vaccine be provided to all pathologists and laboratory personnel,” he said. “Pathologists have led throughout this pandemic by bringing tests for the coronavirus online in communities across the country and we must ensure that patient access to testing continues. We must also serve as a resource to discuss the facts about the vaccine and answer questions patients, family members, and friends have about why they should get the vaccine when it is available to them.”

In a phone call following a virtual press conference, pathologists and CAP President Patrick Godbey, MD (above), told MedPage Today that even if medical laboratory staff are not directly in contact with patients, they should be considered “top tier” (designated as Phase 1a) for getting the vaccine. “I think they [clinical laboratory workers] should be considered in the same tier as nurses,” said Godbey, who also is Laboratory Director at Southeastern Pathology Associates and Southeast Georgia Health System in Brunswick, Ga. “They’re indispensable. Without them, there’d be no one to run the tests.” (Photo copyright: Southeast Georgia Health System.)

Who Does CDC Think Should Be First to Be Vaccinated?

According toThe New York Times (NYT), there are an estimated 21 million healthcare workers in the United States, making it basically “impossible,” the NYT wrote, for them all to get vaccinated in the first wave of COVID-19 vaccinations.

A December 11, 2020, CDC Morbidity and Mortality Weekly Report, titled, “ACIP Interim Recommendation for Allocating Initial Supplies of COVID-19 Vaccine—United States, 2020,” notes that “The [federal] Advisory Committee on Immunization Practices (ACIP) recommended, as interim guidance, that both 1) healthcare personnel and 2) residents of long-term care facilities be offered COVID-19 vaccine in the initial phase of the vaccination program.”

The ACIP report defines healthcare personnel as “paid and unpaid persons serving in healthcare settings who have the potential for direct or indirect exposure to patients or infectious materials.”

However, a CDC terminology guidance document listed at the bottom of the ACIP report states, “For this update, HCP [Healthcare Personnel] does not include dental healthcare personnel, autopsy personnel, and laboratory personnel, as recommendations to address occupational infection prevention and control (IPC) services for these personnel are posted elsewhere.”

On December 16, the American Society for Clinical Pathology (ASCP) called attention to this discrepancy by sending a letter to CDC Director Robert R. Redfield, MD. The letter was co-signed by the:

In part, the letter stated, “We are convinced that ACIP did not intend to exclude any healthcare workers from its recommendation to offer vaccinations to healthcare personnel in the initial phase of the COVID-19 vaccination program (Phase 1a). However, we would hate for jurisdictions to overlook dental, autopsy, and laboratory personnel because of a minor footnote in [CDC] guidance that was developed for an entirely different purpose (i.e., infection control).

“We respectfully ask CDC to clarify,” the letter continues, “… that all healthcare workers—including dental, autopsy, and laboratory personnel—are among those who should be given priority access to vaccine during the initial phase of the COVID-19 vaccination program.”

Forgotten Frontline Healthcare Workers?

Clinical laboratory professionals continue to maintain they should be in the first priority grouping, because they are in direct contact with the virus even if they are not directly interacting with patients. In the CAP virtual press conference streamed on Dec. 9, 2020, Godbey; Amy Karger, MD, PhD, faculty investigator at the University of Minnesota and Medical Director of MHealth Fairview Point-of-Care Testing; and Christine Wojewoda, MD, FCAP, Director of Clinical Microbiology at the University of Vermont Medical Center, made their case for early vaccination of medical laboratory workers.

“In the laboratory, they are encountering and handling thousands of samples that have active live virus in them,” said Karger, who called clinical laboratory staff and phlebotomists the “forgotten” frontline healthcare workers. “We’re getting 10,000 samples a day. That’s a lot of handling of infectious specimens, and we do want [staff] to be prioritized for vaccination.”

Karger continued to stress the vital role clinical laboratories play not only in COVID-19 testing but also in the functioning of the overall health system. She added that staff burnout is a concern since laboratory staff have been working “full throttle” since March.

“From an operational standpoint, we do need to keep our lab up and running,” she said. “We don’t want to have staff out such that we would have to decrease our testing capacity, which would have widespread impacts for our health system and state.”

Testing for Post-Vaccine Immunity

The CAP panelists also highlighted the need to prepare for the aftermath of widespread COVID-19 vaccinations—the need to test for post-vaccine immunity.

“It’s not routine practice to check antibody levels after getting a vaccine but given the heightened interest in COVID testing, we are anticipating there is going to be some increased in demand for post-vaccine antibody testing,” Karger said. “We’re at least preparing for that and preparing to educate our providers.”

Karger pointed out that clinical pathologists will play an important role in educating providers about the type of antibody tests necessary to test for COVID-19 immunity, because, she says, only the SARS-CoV-2 spike protein antibody test will check for an immune response.

With the pandemic expected to stretch far into 2021, clinical laboratories will continue to play a crucial role in the nation’s healthcare response to COVID-19. As essential workers in the fight against infectious disease, clinical pathologists, clinical chemists, and all medical laboratory staff should be prioritized as frontline healthcare workers.

—Andrea Downing Peck

Related Information:

Pathologists Want First Crack at COVID Vaccines

The Rapidly Changing COVID-19 Testing Landscape

Some Health Care Workers Getting the Vaccine. Other’s Aren’t. Who Decides?

The Advisory Committee on Immunization Practices’ Interim Recommendation for Allocating Initial Supplies of COVID-19 Vaccine–United States, 2020

CDC Appendix 2-Terminology: Infection Control in Healthcare Personnel

ASCP Letter: COVID-19 Vaccination Playbook for Jurisdictional Operations

Prioritizing the COVID-19 Vaccine to Protect Patient Access to DiagnosticsCMS Changes Medicare Payment to Support Faster COVID-19 Diagnostic Testing

Success of Harvard Pilgrim Value-Based Pharma Contracts Might Indicate a Transition Away from Fee-for-Service to Value-Based Care in Other Healthcare Areas

New value-based healthcare payment models could have far-reaching effects on medical laboratories and the testing they provide

Hospitals, physicians, and medical laboratories recognize the transition from “volume to value” that’s underway in the American healthcare system. Fee-for-service payments for clinical services (regardless of whether they are needed or effective) will soon cease and providers will be increasingly paid on how much value they deliver to patient care. This will fundamentally alter the complete care continuum, from hospital stays to pathology consults to clinical laboratory testing services.

One such change involves value-based drug contracts with pharmaceutical manufacturers. According to an article in The Boston Globe, in an effort to reduce the ever-increasing cost of prescription drugs while still “giving patients access to costly treatments,” Harvard Pilgrim Health Care (Harvard Pilgrim)—one of Massachusetts’ largest health insurers with more than 1.3 million members—is negotiating value-based agreements with major pharmaceutical manufacturers. How much money Harvard Pilgrim pays for certain drugs will depend on how much the healthcare organization contributes to curing/improving their patients’ conditions.

Value-Based Pharmaceutical Agreements

Harvard Pilgrim first made news for their value-based drug contracts in 2015 when they contracted with three companies:

Harvard Pilgrim currently has 12 value-based pricing contracts with pharmaceutical companies.  According to a news release, the contracts enable Harvard Pilgrim to monitor “specific criteria in patients following discharge” for the effectiveness of medication. “If the medicines fail to meet the agreed upon outcomes criteria in real patients, Harvard Pilgrim will be charged a lower amount,” the news release states.

a majority of health plans are interested in forming outcomes-based contracts with biopharmaceutical manufacturers

The graph above is from an analysis by Avalere Health, a strategic advisory company in Washington, DC, that develops solutions for healthcare. It shows how, according to Avalere, “a majority of health plans are interested in forming outcomes-based contracts with biopharmaceutical manufacturers that tie product reimbursement to patient outcomes.” (Image copyright: Avalere Health.)

These contracts link a drug’s cost to its overall effectiveness in ways that make companies accountable for results in terms of real-world patient outcomes, rather than controlled trial results. Michael Sherman, MD, Harvard Pilgrim’s Chief Medical Officer and SVP of Health Services, stated in the news release that they put drug companies “at risk for delivering” on their promises.

According to Harvard Pilgrim Health Care President and CEO Eric Schultz, value-based agreements between insurance, hospitals, medical laboratories, and drug companies are becoming increasingly important. At the 2017 America’s Health Service Plans (AHIP) Institute and Expo, Schultz stated that in terms of value-based contracting, “right now, it’s all about clinical outcomes,” a FierceHealthcare article covering the event noted. Shultz believes this is a good thing for patients that could positively impact all areas of healthcare.

Harvard Pilgrim is not alone in shifting to value-based healthcare (AKA, value-based purchasing and Pay-for-Performance). According to a news release, the University of Pittsburgh Medical Center (UPMC) Health Plan recently created the Center for Value-Based Purchasing for Pharmaceuticals. According to William Shrank, MD, UPMC Health Plan’s Chief Medical Officer, the Center is determined to evaluate outcomes and effects of the new payment models, which have the potential to “rapidly influence pharmaceutical purchasing nationwide and promote greater value in medication use.”

Can Medical Laboratories Participate in Value-based Models?

The rise of value-based healthcare models affects more than just pharmaceutical companies; medical laboratories nationwide are considering how value-based systems might affect their work and mission as well. In an Orchard Software whitepaper titled, “The Value of the Laboratory in the New Healthcare Model,” Daniel J. Scully, CEO of New York’s Buffalo Medical Group, stated that the “50-million dollar” question for laboratories is “does the laboratory offer enough value in service and speed of results” for the new value-based healthcare models?

Clinical laboratories play such a vital role in healthcare quality—providing accurate diagnosing and crucial monitoring, as well as data collection and risk assessment—they may find themselves affected by value-based healthcare changes. Because of the high costs of equipment and testing, laboratories may also find themselves scrambling to eliminate costs and improve on efficiency, by monitoring resources and testing outcomes in connection to patient needs.

Clinical pathologists may also find themselves more frequently called upon to assist in guiding clinicians to more “effectively utilize lab services to achieve better care,” according to the Orchard Software white paper.

Clinical Associations Say Medical Laboratories Crucial to Success of Value-based Healthcare

The American Association for Clinical Chemistry (AACC) and the American Society for Clinical Pathologists (ASCP) have both addressed what the change to a value-based healthcare system may mean for clinical pathologists.

An ASCP white paper states that clinical pathology data has become increasingly important as “clinical laboratory data are now used to measure provider performance, both individual and organizational, as well as to inform value-based purchasing that optimizes healthcare resources and decreases costs.”

In a position statement, the AACC noted that laboratory testing was crucial to this new model, and that “laboratory professionals are uniquely positioned” to help increase value within healthcare by helping “clinicians identify the most effective testing protocol and interpret the results accurately. Clinical laboratorians can further reduce healthcare costs by developing new, more precise tests to personalize patient care and creating computerized clinical decision support interventions to aid test selection.” Some types of testing, however, particularly expensive molecular and genetic testing, may end up a target of similar value-based agreements between the labs that perform these tests and the provider organizations that use the tests.

Much of the focus on value-based healthcare is currently on value-based pharmaceutical contracts, such as those from Harvard Pilgrim. Nevertheless, clinical laboratories will likely play vital roles in providing care, guiding testing, and evaluating care outcomes under these new payment models. They also could find themselves part of a larger debate concerning overuse of testing or data collection.

Changes to healthcare from pay-for-service to pay-for-value will undoubtedly have far-reaching effects as healthcare fields attempt to cut costs while providing better services. Every clinical laboratory must be proactive in finding its place in these new models.

Amanda Warren

Related Information:

Harvard Pilgrim Expands Use of Novel Drug Purchasing Deals

Value for Consumer Drugs—Harvard Pilgrim Leads the Way

Harvard Pilgrim Signs Outcomes-Based Contracts with AstraZeneca for Brilinta and Bydureon

UPMC Health Plan Establishes Unprecedented Center for Value-Based Purchasing for Pharmaceuticals

Harvard Pilgrim Signs Second Groundbreaking Contract with Amgen for Repatha

Lilly’s Trulicity Joins Pay-for-performance Trend with Harvard Pilgrim Deal

Advancing Value-Based Healthcare: Laboratory Medicine’s Essential Role

The Value of the Laboratory in the New Healthcare Model

AHIP 2017: Harvard Pilgrim, Eli Lilly CEOs Talk Drug Prices and Paying for Value

Health Insurers Go All in on Value-based Drug Pricing

Health Plans Are Interested in Tying Drug Payments to Patient Outcomes

Harvard Pilgrim Bets on Value-based Drug Payments with New Deals

Harvard Pilgrim to Pay for 2 Autoimmune Drugs Based on Outcomes, Value

Value-based Contracts Key to Solving U.S. Drug Pricing ‘Crisis’

Nearly One-Third of Traditional Medicare Payments Now Based on Value-Based Reimbursement and Alternative Payment Models

Ongoing Growth in Volume of Clinical Laboratory Tests That Support Precision Medicine Due to Physician Acceptance; Payers Still Have Concerns

Pathologists and Clinical Lab Executives Take Note: Medicare Has New Goals and Deadlines for Transitioning from Fee-For-Service Healthcare Models to Value-Based Reimbursement

Up to 50% of Aetna, UnitedHealth Group, and Anthem Reimbursements Go to Value-Based Contracts; Clinical Laboratories Must Implement Value-Based Strategies to Remain Competitive

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