Clinical laboratories that service both settings could be impacted as new CMS proposed rule attempts to align Medicare’s payment policies for outpatient and in-patient settings
Hospital outpatient revenue is catching up to inpatient
revenue, according to data released from the American
Hospital Association (AHA). This increase is part of a growing trend to
reduce healthcare costs by treating patients outside of hospital settings. It’s
a trend that is supported by the White House and Medicare and continues to
impact clinical
laboratories, which serve both hospital inpatient and outpatient customers.
The AHA published this study data in its annual Hospital Statistics, 2019Edition. The data comes from a 2017 survey of 5,262
US hospitals. The report includes data about utilization, revenue, expenses,
and other indicators for 2017, as well as historical data.
The AHA statistics on outpatient revenue suggest providers
nationwide are working to keep people out of more expensive hospital settings. Hospitals,
like medical
laboratories, appear to be succeeding at developing outpatient and outreach
services that generate needed operating revenue.
This aligns with Medicare’s push to make healthcare more accessible through outpatient settings, such as urgent care clinics and physician’s offices. A growing trend Dark Daily has covered extensively.
Outpatient Revenue
Climbs
In its coverage of
the AHA’s study, Modern Healthcare reported that 2017
hospital net inpatient revenue was $498 billion and net outpatient revenue was
$472 billion.
The Becker’s Hospital CFO Report notes that
gross inpatient revenue in 2017 was $92.7 billion higher than gross outpatient
revenue. But in 2016, gross inpatient revenue was much further ahead—$129.5
billion more than gross outpatient revenue. The “divide” between inpatient and
outpatient revenue is narrowing, Becker’s reports.
The graphic above illustrates the shrinking gap between hospital inpatient and outpatient revenues. “Outpatient revenue will ultimately eclipse inpatient revenue,” Chuck Alsdurf, Director of Healthcare Finance Policy and Operational Initiatives at the Healthcare Financial Management Association (HFMA), told Modern Healthcare. (Graphic copyright: Modern Healthcare/AHA.)
The Becker’s
report also stated:
Admissions increased by less than 1% to 34.3
million in 2017, up from 34 million in 2016;
Inpatient days were flat at 186.2 million;
Outpatient visits rose by 1.2% to 766 million in
2017; and,
Outpatient revenue increased 5.7% between 2016
and 2017.
Similar Study Offers Additional
Insight into 2018 Outpatient Revenue
A benchmarking report by Crowe,
a public accounting, consulting, and technology firm, which analyzed data from
622 hospitals for the period January through September of 2017 and 2018, showed
the following, as reported by RevCycleIntelligence:
Inpatient volume was up 0.6% in 2018 and gross
revenue per case grew by 5.3%;
Outpatient services rose 2.4% in 2018 and gross
revenue per case was up 7.1%.
Physicians’ Offices
Have Lower Prices for Some Hospital Outpatient Services
Everything, however, is relative. When certain healthcare
services traditionally rendered in physician’s offices are rendered, instead,
in hospital outpatient settings, the numbers tell a different story.
In fact, according to the Health
Care Cost Institute (HCCI), the price for services was “always higher” when
performed in an outpatient setting, as compared to doctor’s offices.
HCCI analyzed services at outpatient facilities as well as
those appropriate to freestanding physician offices. They found the following
differences in 2017 prices:
Diagnostic and screening ultrasound: $241 in
physician’s office—$650 in hospital outpatient setting;
Level 5 drug administration: $254 in office—$664
in hospital outpatient setting;
Upper airway endoscopy: $527 in office—$2,679 in
hospital outpatient setting.
One example where hospital outpatient settings provide similar services at increased costs is in drug administration, as the graphic above illustrates. “The difference was higher than I expected. With some services, the price is two or three times higher when rendered in the outpatient setting,” Julie Reiff, HCCI researcher and report author, told Fierce Healthcare. (Graphic copyright: HCCI.)
Medicare Proposed
Rule Would Change How Hospital Outpatient Clinics Get Paid
Meanwhile, the Centers for
Medicare and Medicaid Services (CMS) has released its final rule (CMS-1695-FC),
which make changes to Medicare’s hospital outpatient prospective payment and
ambulatory surgical center payment systems and quality reporting programs.
In a news
release, CMS stated that it “is moving toward site neutral payments for
clinic visits (which are essentially check-ups with a clinician). Clinic visits
are the most common service billed under the OPPS [Medicare’s Hospital
Outpatient Prospective Payment System). Currently, CMS often pays more for
the same type of clinic visit in the hospital outpatient setting than in the
physician office setting.”
“CMS is also proposing to close a potential loophole through
which providers are billing patients more for visits in hospital outpatient
departments when they create new service lines,” the news release states.
Hospitals are fighting the policy change through a lawsuit, Fierce Healthcare reported.
In summary, clinical laboratories based in hospitals and
health systems are in the outpatient as well as inpatient business. Medical laboratory
tests contribute to growth in outpatient revenue, and physician offices compete
with clinical laboratories for some outpatient tests and procedures. Thus, a new
site-neutral CMS payment policy could affect the payments hospitals receive for
clinic visits by Medicare patients.
Customer relationship
management (CRM) plays a critical role in helping providers care for patients
with chronic diseases and clinical laboratories are part of those solutions
Home healthcare continues to boom in the US and more
technology companies each year—including Salesforce—strive to expand their
presence within the industry. This represents a significant shift in site of
service for a substantial and growing number of Americans. Equally true is that
home healthcare is an opportunity for clinical laboratories to serve this
increasing proportion of the American population.
Statistics tell the tale behind the boom in home healthcare.
The Centers
for Disease Control and Prevention (CDC) estimates that six in 10 adults in
the United States suffer from chronic diseases, such as cancer, and four in 10
adults live with two or more chronic illnesses.
This means that among medical laboratories and other
providers servicing the home healthcare industry demand for clinical laboratory
testing will increase.
Last year, approximately $103 billion was spent on home
healthcare services and that number is expected to reach $173 billion by 2026,
according to the Centers for Medicare and
Medicaid Services (CMS). Approximately 7.6 million people in the US now
require some level of in-home medical care. The overall employment of in-home
healthcare providers is projected to grow 41% between 2016 and 2026.
Efficient tools that assist home healthcare organizations and
their providers are critical. Customer
Relationship Management (CRM) platforms that combine data gathered during
office visits with patients’ living and economic situations are proving to be powerful
allies for treating chronic disease populations.
Social Determinants
of Health
One such CRM developer, Salesforce,
is rising to the demand by adding new features to its existing Health
Cloud platform. Originally introduced in 2016 as a way to improve how
healthcare and life sciences organizations connect with patients, this product
is one example of how Silicon Valley companies are attempting to make inroads
within the healthcare sector. Health Cloud’s newest functional upgrades include:
These social determinants of health are typically not
included in health records. But they can be vital information for healthcare
providers. Clinical laboratory managers should pay attention to “social
determinants of health” because this term describes a new dimension in medical
care and how patients with chronic diseases are managed.
“A lot of people in healthcare know about the importance of social determinants of health, but the volume of information is so great that being able to display things clearly and concisely in front of the [providers who] are using it—when they need it—makes it more operant and more prominent in the care of that patient,” Joshua Newman, MD, Chief Medical Officer at Salesforce, told MedCity News. (Photo copyright: San Francisco Business Times/Biz Journals.)
This is a critical factor. Healthcare providers who use Salesforce’s
Health Cloud can now record a patient’s social determinant information—such as,
transportation issues, housing status, and care network—directly into that
patient’s profile. Access to this type of information can give healthcare
professionals a more complete understanding of each patient’s unique situation.
Here are some examples from a Salesforce press
release that illustrate how social-determinants-of-health data can help
patients and care providers:
“A care provider that wants to limit a patient’s
risk for readmission can know if the patient has access to transportation or
the ability to purchase healthy meals.
“A life science organization that wants to help
patients adhere to their therapies, or properly use their medical devices, can
see a patient’s employment status and living arrangements, and thus offer the
necessary level of financial and in-home support.
“A payer organization can deliver personalized
preventative or wellness material to members based on the member’s education or
reading level.”
“Our industry continues to centralize and integrate patient
data, but it is critical that we stay focused on improving the patient
experience,” noted Ashwini
Zenooz, MD, in the press release. Zenooz is Salesforce’s Senior Vice
President and General Manager, Global Healthcare and Life Sciences. “By surfacing
critical factors of a patient’s life in a single view, we empower care
providers to personalize patient care experiences and improve outcomes.”
Many
existing CRM products cannot collect data from a variety of sources and then
sort and analyze that information to provide users with actionable
intelligence. Salesforce is attempting to fill that void among health and
medical software products with Health Cloud.
“Healthcare has been slower culturally, politically, and
socially to share their data. But what we’re seeing now is even those
organizations that have historically not shared their data are realizing they
can do a better job if they do,” Newman told MedCity News.
Outside Hospital Care
Increasing
Salesforce has also added a service it calls the Connected
Patient Journey to its Health Cloud platform. This service is an
integration between Health Cloud and Salesforce marketing, which can
personalize information given to patients based on their unique health needs.
Using this feature allows providers to build patient lists and use marketing techniques
to reach patients who would most benefit from specific campaigns and
information.
“The general overarching theme that unites all of these
innovations is that care is gravitating increasingly toward the home or outside
of the hospital and the doctor’s office,” said Newman.
Whether in-hospital or in-home, clinical laboratory tests play
a critical role in healthcare services. The ability for clinical laboratories
to enter patients’ test results data directly into CRM systems like Health
Cloud could help providers utilizing those systems better assist patients with
chronic diseases.
The researchers also found unnecessarily confusing policies and procedures for requesting medical records, such as clinical laboratory test results
Clinical laboratories and anatomic pathology groups looking for ways to improve their customers’ experience should give high priority to ensuring patients have easy, accurate access to their own health records. This would, apparently, set them apart from many hospital health networks if a recent study conducted by Yale University School of Medicine is any indication.
Conducting their research from August 1 through December 7, 2017, Yale researchers evaluated the medical records processing policies of 83 top-ranked hospitals located across 29 states. They found that patients attempting to obtain copies of their own medical records from various hospitals often faced unnecessary and confusing hurdles. They also found serious noncompliance issues with regards to the HealthInsurance Portability and Accountability Act of 1996 (HIPAA).
Overwhelming Inconsistencies in Policies
and Procedures
“There were overwhelming inconsistencies in information relayed to patients regarding the personal health information [PHI] they are allowed to request, as well as the formats and costs of release, both within institutions and across institutions,” said Carolyn Lye, a medical student at the Yale School of Medicine and first author of the study, in a Yale News article. “We also found considerable noncompliance with state and federal regulations and recommendations with respect to the costs and processing times associated with providing access to medical records.”
“Stricter enforcement of the patients’ right of access under HIPAA is necessary to ensure that the medical records request process across hospitals is easy to navigate, timely, and affordable,” study first author Carolyn Lye (above), told Yale News. “We are also in an era in which patients are participants in their own healthcare. Inhibiting access for patients to their own medical records with complicated, lengthy, and costly request processes prevents patients from obtaining information that they may need to better understand their medical conditions and communicate with their physicians.” (Photo copyright: Twitter.)
The researchers collected release authorization forms from
the hospitals by calling each hospital’s medical records department. During the
simulated patient experience, they questioned the hospital policies regarding:
Requestable information (including entire
medical records, medical laboratory test results, medical history, discharge
summaries, physician orders, consultation reports);
Available release formats (pick up in person,
mail, fax, e-mail, CD, online patient portal);
Costs associated with obtaining the records;
and,
Processing times.
The team found inconsistencies between information provided
on written authorization forms and the simulated patient telephone calls, as
well as a lack of transparency.
On the paper forms, only 44 hospitals (53%) had an option
for patients to acquire their entire medical record. However, on the telephone
calls, all 83 of the surveyed hospitals provided that option.
The researchers also discovered discrepancies in the
information regarding the formats available for patient records. For example,
69 (83%) of the hospitals stated during the phone calls that patients could
pick up their records in person, while only 40 (48%) of the hospitals said patients
could do so on the written release forms. Fifty-five (66%) of the hospitals
told callers that medical records were available on CD and only 35 (42%) of the
hospitals provided that option on the written forms.
Similar discrepancies between information provided in phone
calls versus paper authorization forms were found relating to other formats
included in the study as well.
Excessive Fees Exceed
Federal Recommendations
Hospitals are allowed to charge a modest fee for the release
of medical records. But the researchers found quoted costs varied widely among
surveyed hospitals.
On the written authorization forms, only 29 (35%) of the
hospitals disclosed the exact costs associated with obtaining medical records.
The costs for a hypothetical 200-page record from these hospitals ranged from
$0.00 to $281.54. During the phone calls, 82 of the hospitals disclosed their
fees, with quotes for obtaining a 200-page record ranging from $0.00 to
$541.50.
The federal government, however, recommends charging
patients a flat fee of $6.50 to obtain electronically maintained medical
records. Forty-eight (59%) of the hospitals surveyed exceeded that charge.
Access Times Also Vary
The time hospitals needed to release patients’ medical
records also varied, ranging from same-day to 60 days—with electronic data
tending to be delivered fastest. Federal regulations require medical records to
be released within 30 days of the initial request, though HIPAA provides for an
additional 30-day extension. However, six of the 81 hospitals that provided
turn-around times to medical records requests were noncompliant with federal processing
time requirements.
Congress
passed HIPAA primarily to modernize the flow of healthcare information. An
important part of the Act was to make it easier for patients to receive their
medical records and clinical data from hospitals, medical offices, clinical
laboratories, etc. The Yale study, however, indicates that obtaining medical
records can still be a cumbersome and perplexing process for patients.
The United States Government has spent upwards of $30 billion since 2010 in incentives to encourage hospitals and physicians to implement and use electronic health record (EHR) systems. One goal of issuing these incentives was to make it easy and inexpensive to move patient data between providers to support improved clinical care, as reported by the Commonwealth Fund.
This
research demonstrates that the internal policies of some hospitals and health
systems are contrary to federal and state laws because patients are often
struggling to gain access to their own medical records. The results of the Yale
study present an opportunity for clinical laboratories and pathology groups to
adopt and offer patient-friendly access to obtain lab test data.
Even more compelling was the discovery of DNA from the Staph bacteria on the stethoscopes even after they were cleaned. Though the tests could not differentiate between live and dead bacteria, the researchers found other non-Staph bacteria as well, including Pseudomonas and Acinetobacter.
Similar conditions could no doubt be found in most
healthcare settings in America, highlighting the critical importance for
rigorous cleaning procedures and protocols.
“The study underscores the importance of adhering to rigorous infection control procedures, including fully adhering to CDC-recommended decontamination procedures between patients, or using single-patient use stethoscopes kept in each patient’s room,” said Ronald Collman, MD (above), the study’s senior author and Professor of Medicine, Pulmonary, Allergy, and Critical Care at UPenn’s Perelman School of Medicine, in a news release. (Photo copyright: Penn Medicine.)
The researchers acknowledged that previous culture-based bacterial
studies looked at stethoscopes, but noted the results fell short of the view
next-generation sequencing technology can offer for identifying bacteria, as
well as determining the effectiveness of cleaning chemicals and regiments.
“Culture-based studies, which focus on individual organisms,
have implicated stethoscopes as potential vectors of nosocomial bacterial
transmission [HAI]. However, the full bacterial communities that contaminate
in-use stethoscopes have not been investigated,” they wrote in Infection Control and Hospital Epidemiology.
• 20 worn by physicians, nurses, and respiratory therapists;
• 20 single patient-use disposable stethoscopes available in ICU patient rooms; and,
• 10 unused single-use disposable stethoscopes to serve as a control.
All stethoscopes worn and/or used in the ICU were found to be contaminated with abundant amounts of Staphylococcus DNA. “Definitive” amounts of Staph was found by researchers on 24 of 40 tested devices, noted MedPage Today.
“Genera relevant to healthcare-associated infections (HAIs)
were common on practitioner stethoscopes, among which Staphylococcus was ubiquitous
and had the highest relative abundance (6.8% to 14% of containment bacterial
sequences),” the researchers noted in their paper.
Cleaning Methods Also
Examined
The researchers also studied the hospital’s cleaning agents
and procedures:
• 10 practitioner stethoscopes were examined before and after a standard 60-second cleaning procedure using hydrogen peroxide wipes;
• 20 additional stethoscopes were assessed before and after cleaning by practitioners using alcohol wipes, hydrogen peroxide wipes, or bleach wipes.
All methods reduced bacteria. But not to the levels of a new
stethoscope, the study showed.
“Stethoscopes used in an ICU carry bacterial DNA reflecting complex microbial communities that include nosocomially important taxa. Commonly used cleaning practices reduce contamination but are only partially successful at modifying or eliminating these communities,” the researchers concluded in their paper.
Prior Studies to Find
and Track Dangerous Bacteria
Studies tracking bacteria where people live, work, and
travel are not new. For years, medical technologists and microbiologists have
roamed the halls of hospitals and other clinical settings to swab and culture
different surfaces and even articles of clothing. These efforts are often
associated with programs to reduce nosocomial infections (HAIs).
This new study by UPenn Perelman School of Medicine researchers—published
in a peer-reviewed medical journal—will hopefully serve as a contemporary
reminder to doctors and other caregivers of how bacteria can be transmitted and
the critical importance of cleanliness, not only of hands, but also
stethoscopes (and neckties).
Hospital-based medical laboratory leaders and microbiology professionals also can help by joining with their infection control colleagues to advocate for CDC-recommended disinfection and sterilization guidelines throughout their healthcare networks.
FDA cautions patients to not use data gained from the DTC test to make healthcare decisions on their own
Clinical laboratories continue to be impacted by the growing direct-to-consumer (DTC) testing market, as more walk-in lab customers order at-home tests. Now, the US Food and Drug Administration (FDA) has authorized a DTC test company to provide results of a pharmacogenetic (PGx) test to customers without needing a doctor’s order. This is the first genetic test of its kind to receive such FDA authorization and is in line with the government’s focus on precision medicine.
23andMe gained the authorization through the FDA’s de novo classification process, which the FDA uses to classify new devices that have no existing classification or comparabledevice on the market.
“We’ve continued to innovate through the FDA and pioneer safe, effective pathways for consumers to directly access genetic health information,” said Anne Wojcicki, co-founder and CEO of 23andMe, in a news release. “Pharmacogenetic reports are an important category of information for consumers to get access to, and I believe this authorization opens the door for consumers to work with their health providers to better manage their medications.”
However, some experts caution that informing patients
directly on how they metabolize medications based on genetic testing could
encourage them to bypass physicians and medical laboratories in the decision-making
process.
In a safety communication, the FDA alerted patients and
healthcare providers that “claims for many genetic tests to predict a patient’s
response to specific medications have not been reviewed by the FDA and may not
have the scientific or clinical evidence to support this use for most
medications. Changing drug treatment based on the results from such a genetic
test could lead to inappropriate treatment decisions and potentially serious
health consequences for the patient.”
Tim Stenzel, MD, PhD (above), Director, Office of In Vitro Diagnostics and Radiological Health at the FDA, told FierceBiotech, “This test should be used appropriately because it does not determine whether a medication is appropriate for a patient, does not provide medical advice, and does not diagnose any health conditions. Consumers should not use this test to make treatment decisions on their own.” (Photo copyright: LinkedIn.)
PGx Supports
Precision Medicine
Pharmacogenetics (PGx) is the study of how genetic differences among individuals cause
varied responses to certain drugs. Demand for PGx testing has increased
exponentially as it becomes more valuable to consumers. It could provide a path
to precision medicine treatment plans based on each patient’s genetic traits. And
help determine which drug therapies and dosages may be optimal and which
medicines should be avoided.
“This test is a step forward in
making information about genetic variants available directly to consumers and
better inform their discussions with their healthcare providers,” Stenzel told FierceBiotech. “We know that consumers
are increasingly interested in genetic information to help make decisions about
their healthcare.”
The genes and their variants examined in the 23andMe PGx
test are:
Innovative hospital and health networks also are starting to
make PGx tests available in primary care settings.
Sanford Imagenetics, part of the Sanford Health system, has produced a $49 laboratory-developed test (LDT) for genetic screening known as the Sanford Chip to help physicians select the most advantageous therapies for their patients. It uses a small amount of blood to identify patients’ risk for certain genetic diseases and determine which medications would be best for them.
Sanford Health, headquartered in Sioux Falls, SD, is one of
the largest health systems in the US with 44 hospitals, 1,400 physicians, and
more than 200 senior care locations in 26 states and nine countries.
Geisinger Health, headquartered in Danville, PA, has initiated a pilot project based on PGx testing. The genetic sequencing data from 2,500 patients will be reviewed to determine if they are taking the best medication for their health conditions. Patients in need of changes to their prescriptions will be contacted by Geisinger pharmacists for recommendations.
As consumer demand for PGx testing increases, DTC customers will
likely continue seeking new information about their genome. Clinical
laboratories could play a role in interpreting that data and assisting
pathologists and other healthcare providers determine the best drug therapies
for optimal health outcomes.
