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Clinical Laboratories and Pathology Groups

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States Pursue Legislation Limiting AI’s Growing Role in Payer Prior Authorization Denials and Claims Processing

This follows class action lawsuits in multiple states against insurance companies that deny millions of healthcare claims each year

Artificial intelligence (AI) has become ubiquitous in many aspects of healthcare. But perhaps its most controversial use is in the payer denial-of-claims process. Multiple states are pursuing legislation that would limit or outright ban AI’s use without physician involvement.

Clinical laboratories experience payment denials at both the prior authorization stage when a doctor orders a lab test as well as when the claim is submitted for reimbursement. And many labs perform tests for which they know they will not be paid just to maintain the client account relationships with doctors.

Now, several states are taking measures to protect patients from what some say is a dangerous trend to use AI algorithms only to review and deny medical claims for critical healthcare and clinical laboratory testing. This will be of interest to lab managers and those in charge of their lab’s revenue.

“Physicians and patients already face daunting challenges in navigating medical insurers’ bureaucratic administrative processes,” said Arizona Medical Association (ArMA) President Nadeem Kazi, MD, in a news release. “Taking physicians’ clinical experience out of these processes entirely is a misguided step,” he added.

In Arizona, the state’s House of Representatives passed Bill 2175 on February 20, which includes a ban on using AI to deny medical claims without physician involvement, NBC News reported.  

However, on March 13, the Arizona Senate’s Finance Committee altered the language in its version of the bill. In it, AI is not specifically mentioned.

Instead, the bill’s language now “requires a medical director or healthcare provider, before a healthcare insurer may deny a claim or issue a direct denial of a prior authorization, to individually review any denial that involves medical necessity or experimental status or that requires the use of medical judgment and prohibits the director or provider from relying solely on recommendations derived from any other source during the prior authorization denial or claim denial review.”

Presumably, “any other source” includes AI-driven software platforms used by payers for prior authorization denials and claims processing.

“While AI promises innovation for several areas of healthcare, the review and denial of medical insurance claims—some of which represent life-changing treatments and procedures—should be left to physicians who can make nuanced clinical judgments,” said Shelby Job, ArMA communications director, in a statement following that state’s passage of the House bill in February.

The bill is now being debated in the Arizona Senate. If the Senate passes its version, the two sides will need to reconcile their bills.

“Patients deserve healthcare delivered by humans with compassionate medical expertise, not pattern-based computer algorithms designed by insurance companies,” said ArMA President Nadeem Kazi, MD (above), in a news release. (Photo copyright: Arizona Medical Association.)

Multiple States Move to Limit Use of AI in Claims Denials

In an Arizona House of Representatives Committee on Commerce meeting, state Republican representative Julie Willoughby, who is also an ER nurse, said that “she hopes the bill will protect Arizonians from losing healthcare access due to AI interference,” NBC News reported following passage of the House bill.

“What we’re asking for in this is that any claims that are denied have a provider look them over for completeness to ensure that there isn’t anything that the AI algorithm may not have accounted for,” she said.

If signed into law, the bill will require a medical director at the insurance carrier in question to “individually review each claim or prior authorization before a healthcare insurer is able to deny a claim for that patient,” NBC News noted.

California passed similar legislation in September that would “ensure that a licensed physician supervises the use of AI decision-making tools when they are used to inform decisions to approve, modify, or deny requests by providers,” NBC News reported.

The author of the California bill, Democratic senator Josh Becker, JD, argued upon the bill’s passing that AI “should never replace the expertise and judgment of physicians,” adding, “An algorithm cannot fully understand a patient’s unique medical history or needs, and its misuse can lead to devastating consequences.”

And in Texas, a bill introduced by Republican senator Charles Schwertner, MD, states that AI “should not be used as the ‘sole basis of a decision to wholly or partly deny, delay, or modify healthcare services,’” NBC News reported.

In a statement, the Texas Coalition of Patients said the bill is “crucial in ensuring that life-altering healthcare decisions remain in the hands of medical professionals rather than Big Insurance’s automated systems.”

In all, 11 states have introduced legislation to “to push back on artificial intelligence use in reviewing medical claims,” according to NBC News.

In May 2023, The Dark Report explored payer claims denials, and it was acknowledged back then that automated systems were already reviewing claims.

And then there are the lawsuits. According to The Guardian, Cigna, Humana, and UnitedHealth all face class-action lawsuits concerning the use of AI to “deny lifesaving care.”

Can AI Coexist with Human-based Care?

Although at this time AI may not understand the nuanced complexities of healthcare claims, there seem to be plenty of uses for it in healthcare decision-making. It can analyze large sets of data for diagnosis, transcribe medical documents using automatic speech recognition, and streamline administrative tasks––all of which can help a workforce plagued by staff burnout and shortages, Los Angeles Pacific University noted.

And though its use in payer claims reviews and denials is being resisted, AI will likely continue to help doctors diagnose disease and make better treatment decisions. Nevertheless, clinical laboratory and pathology workers should be aware of how the tool is being used and keep an eye out for suspicious claims denials.                         

—Ashley Croce

Hospital Bills Insured Woman $18k for Biopsy Procedure the Healthcare Provider’s Online Patient Payment Estimator Said Would Typically Cost Uninsured Patients $1,400

Though the No Surprises Act was enacted to prevent such surprise billing, key aspects of the legislation are apparently not being enforced

Dani Yuengling thought she had properly prepared herself for the financial impact of a breast biopsy. After all, it’s a simple procedure, especially if done by fine needle aspiration (FNA). Then, the 35-year-old received a bill for $18,000! And that was after insurance and though she had received a much lower advanced quote, according to an NPR/Kaiser Health News (NPR/KHN) bill-of-the-month investigation.

So, what happened? And what can anatomic pathology groups and clinical laboratories do to ensure their patients don’t receive similar surprise bills?

Yuengling had lost her mother to breast cancer in 2017. Then, she found a lump in her own breast. Following a mammogram she decided to move forward with the biopsy. Her doctor referred her to Grand Strand Medical Center in Myrtle Beach, S.C.

But she needed to know how much the procedure would cost. Her health plan had a $6,000 deductible. She worried she might have to pay for the entire amount of a very expensive procedure.

However, the hospital’s online “Patient Payment Estimator” informed her that an uninsured patient typically pays about $1,400 for the procedure. Yuengling was relieved. She assumed that with insurance the amount would be even less, and thankfully, clinical laboratory test results of the biopsy found that she did not have breast cancer.

Then came the sticker shock! The bill broke down like this:

  • $17,979 was the total for her biopsy and everything that came with it.
  • Her insurer, Cigna, brought the cost down to the in-network negotiated rate of $8,424.14.
  • Her insurance then paid $3,254.47.
  • Yuengling was responsible for $5,169.67 which was the balance of her deductible.

So, why was the amount Yuengling owed higher than the bill would have been if she had been uninsured and paid cash for the procedure?

According to the NPR/KHN investigation, this is not an uncommon occurrence. The investigators reported that nearly 30% of American workers have high deductible health plans (HDHPs) and may face larger expenses than what a hospital’s cash price would have been for uninsured individuals.

“We can very confidently say this is very common,” Ge Bai, PhD, CPA, professor of accounting at John Hopkins Carey Business School and professor of health policy and management at Johns Hopkins Bloomberg School of Public Health, told NPR/KHN.

Dani Yuengling (above) knew she had to take the lump in her breast seriously. Her mother had died of breast cancer. “It was the hardest experience, seeing her suffer,” Yuengling told NPR/KHN. Fortunately, following a biopsy procedure, clinical laboratory testing showed she was cancer free. But the bill for the procedure was shockingly higher than she’d expected based on the hospital’s patient payment estimator. (Photo copyright: Kaiser Health News.)

Take the Cash Price

In 2021, Bai was part of a John’s Hopkins research team that analyzed US hospital cash prices compared with commercial negotiated rates for specific healthcare services.

The team published its findings in JAMA Network Open titled, “Comparison of US Hospital Cash Prices and Commercial Negotiated Prices for 70 Services.”

“The 70 CMS-specified hospital services represent 74 unique Current Procedural Terminology (CPT) diagnosis related group codes (four services were represented by two codes),” the authors wrote. “Cash prices and payer-specific negotiated prices for the 70 services were obtained from Turquoise Health, a data service company that specializes in collecting pricing information from hospitals.”

They continued, “Cash prices can affect the cost exposure of 26 million uninsured individuals and concern nearly one-third of US workers enrolled in high-deductible health plans, who are often responsible to pay for medical bills without a third-party contribution and thus are interested in having access to low cash prices. In contrast with the commercial price negotiated bilaterally between hospitals and insurers providing insurance plans, the cash price is determined unilaterally by the hospital and might be expected to be higher than negotiated prices.”

However, the team’s research found otherwise. “Across the 70 CMS-specified services … some hospitals set their cash price comparable to or lower than their commercial negotiated price,” they concluded.

Bai advises patients to ask healthcare providers about the cash price before undergoing any procedure no matter what their insurance status is. “It should be a norm,” she told NPR/KHN.

Federal No Surprises Act is not Foolproof

Yuengling was charged an extraordinarily high amount for her procedure compared to other hospitals in her area. Fair Health Consumer estimates the cost of the procedure Yuengling received cost an average of $3,500 at other local hospitals. Uninsured patients likely pay even less.

A spokesperson for Grand Street Medical Center blamed the inaccurate estimate on “a glitch” in the payment estimator system. The hospital has since removed some procedures from the tool until it can be corrected. Yuengling initially disputed the charge with the hospital but in the end decided to pay the full amount she owed.

NPR/KHN recommends that insured patients consult with their health insurance company to get an estimate before any procedure. That is the purpose of the No Surprises Act which was enacted as part of the Consolidated Appropriations Act, 2021 (CAA).

The law requires health insurance companies to provide their members with an estimate of medical costs upon their request. The Act also empowers patients to file federal complaints about their medical bills.

This, however, is not a foolproof plan and patients may still be facing unexpected costs. Sabrina Corlette, JD, research professor, founder, and co-director of the Center on Health Insurance Reforms (CHIR) at Georgetown University’s McCourt School of Public Policy, told NPR/KHN that the part of the law requiring health insurance companies to provide an “Advanced Explanation of Benefits” is not yet being enforced.

Patients who find themselves in a similar situation to Yuengling may want to consider paying the cash price for the procedure. Although this may not be common practice, Jacqueline Fox, JD, a healthcare attorney and professor of law at the University of South Carolina’s Joseph F. Rice School of Law, told NPR/KHN that there is not a law she is aware of that would prohibit patients from doing so.

Anatomic pathology groups and clinical laboratories should check that their online prices and estimation tools comply with the No Surprises Act to ensure that what happened to Yuengling does not happen with their patients. They also could inform patients on how to pay cash for procedures if insurance rates are too high. Medical professionals and patients can work together to achieve transparency in healthcare pricing.

—Ashley Croce

Related Information:

An $18,000 Biopsy? Paying Cash Might Have Been Cheaper than Using Her Insurance

Comparison of US Hospital Cash Prices and Commercial Negotiated Prices for 70 Services

Patient Rights Group Says Too Many Hospitals Are Not Complying with CMS Price Transparency Rules

Price Transparency: What Labs Need to Know Now about Existing Regulations and Pending Legislation

CMS Proposes New Amendments to Federal Hospital Price Transparency Rule That May Affect Clinical Laboratories and Pathology Groups

Pharmacy Benefit Management Company Executives Testify Before Congress on Drug Pricing Practices and Market Manipulation

Because of their big share of patient prescriptions, the three largest PBMs are about to undergo scrutiny via Congressional reports and looming lawsuits that call out questionable practices

Pharmacy benefit managers (PBMs) are finding themselves under scrutiny from both Federal Trade Commission (FTC) investigations into drug pricing as well as recent Congressional hearings into anticompetitive practices.

Because of how PBMs have captured the lion’s share of patient prescriptions away from retail pharmacies in the United States during the past 15 years, pathologists and clinical laboratory managers may want to track how Congress and federal antitrust regulators respond to this development. The issue is the high cost of prescription drugs for patients and the role of PBMs in keeping drug prices high to optimize their profits.

On July 23, the House Committee on Oversight and Accountability held a hearing with top executives from the three largest PBMs to investigate the increasing drug prices and ever-shrinking options available to prescription drug customers. House members heard testimony from Adam Kautzner, PharmD, President of Express Scripts; David Joyner, President of CVS Caremark; and Patrick Conway, MD, CEO of Optum Rx—top executives from the three PBMs that control “approximately 80% of the US prescription market,”Healthcare Dive reported.

House representatives pressed the executives for “steering patients to pharmacies the PBM owns and favoring more expensive brand-name drugs on their formularies, or list of covered drugs, which result in higher rebates paid to them by drugmakers,” Healthcare Dive noted.

In his opening remarks of the full committee hearing, which was titled “The Role of Pharmacy Benefit Managers in Prescription Drug Markets Part III: Transparency and Accountability,” Committee Chairman James Comer (R-Ky) noted that the Committee had “obtained over 140,000 pages of documents and communications exposing Pharmacy Benefit Managers’ (PBMs) anticompetitive policies and their role in rising drug prices,” according to a press release.

In its final report, the Committee on Oversight and Accountability found that “PBMs inflate prescription drug costs and interfere with patient care for their own financial benefit.”

Though hearings on PBMs have been increasing, the last time PBM executives testified on the Hill was before the Senate Committee on Finance in 2019, according to Healthcare Dive.

Spread pricing and rebates benefit PBMs and have helped the three largest PBMs monopolize the pharmaceutical market … these self-benefitting practices only serve to help their bottom line rather than patients,” said Chairman James Comer (above) during a meeting of the federal Committee on Oversight and Accountability. “PBMs have been allowed to hide in the shadows for far too long. I look forward to the Oversight Committee continuing to work in a bipartisan fashion to shine a light on how these PBMs have undermined community pharmacies, raised prescriptions drug prices, and jeopardized patient care.” Clinical laboratory executives may want to track efforts by Congress to rein in PBMs so as to reduce the cost of prescription drugs to patients. (Photo copyright: US Federal Government/Public Domain.)

Turning up the Heat on PBMs

The spotlight began to grow on PBM practices back in 2023. Since then, PBMs have been the focus of three congressional hearings. The late July meeting came just hours after Chairman James Comer, R-KY, presented his report following a 32-month-long investigation “into how PBMs raise prices and reduce consumer choice,” Healthcare Dive reported.

Comer’s research found that “PBMs have used their position as middlemen to cement anticompetitive policies which have increased prescription drug costs, hurt independent pharmacies, and harmed patient care,” according to a press release announcing the upcoming hearing with the executives of the three largest PBMs.

Comer’s report uncovered “300 examples of the three PBMs preferring medications that cost at least $500 more per claim than a safe alternative medication excluded from their formularies,” Healthcare Dive noted.

Coming Lawsuits, Public Opinion

While the Congressional hearings put pressure on the three PBMs, a new threat looms on the horizon—multiple lawsuits—including one from the FTC “over their tactics for negotiating prices for drugs including insulin, after a two-year investigation into whether the companies steer patients away from less-expensive medicines,” The Wall Street Journal reported. 

State attorney generals and independent pharmacies are lining up with lawsuits targeting PBM’s questionable business practices as well, Healthcare Dive reported.

While PBMs maintain their innocence, public opinion differs. An independent survey from KFF found that approximately three out of 10 individuals surveyed reported not taking a prescribed medicine due to expensive costs.

“This includes about one in five who report they have not filled a prescription or took an over-the counter drug instead (21%), and 12% who say they have cut pills in half or skipped a dose because of the cost,” KFF reported.

Further, 82% of those surveyed described the cost of prescription drugs to be unreasonable. Still, 65% described the costs as being easily affordable, with the biggest challenge going to those with a household income of less than $40,000.

PBMs Push Back

In response to the backlash, the PBMs brought their own report to Congress, prepared by global consulting firm Compass Lexecon. It showed that “PBMs pass through almost all rebates to plan sponsors and have operating margins below 5% in recent years,” Healthcare Dive reported.

During their testimony, Conway said that Optum Rx saves over $2,000 per person annually. Kautzner claimed Express Scripts brought $64 billion in savings to patients last year and kept “out-of-pocket costs on a per-prescription basis at $15, despite brand manufacturers raising drug prices on 60% of those products,” Healthcare Dive reported.

Joyner said CVS Caremark experienced “little or no competition” from the pharmaceutical industry for brand name drugs. He blamed the pharmaceutical industry for drug pricing increases, Healthcare Drive reported.

“Let me be clear, we do not contribute to the rising list prices. Hampering our ability to negotiate lower drug cost … would only remove an essential tool and our ability to deliver lower cost for medications,” Joyner told the Congressional committee.

House representatives were not moved.

“On one hand we have PBMs claiming to reduce prescription drug prices and on the other hand we have the Federal Trade Commission, we have major media outlets like The New York Times, and we have at least eight different attorneys generals, Democrats and Republicans, who all say PBMs are inflating drug costs,” said Raja Krishnamoorthi (D-Ill), Healthcare Dive reported.

“This is why just about every state now is taking up PBM reform,” Comer said. “There’s a credibility issue.”

Because there has been a parallel concentration of market share for clinical laboratory testing among a handful of billion-dollar national lab corporations, clinical laboratory managers may want to follow these events. They are examples of federal regulators investigating the business practices of a major healthcare sector while, at the same time, members of Congress look for ways to lower healthcare costs. Prescription drugs is a high-profile target.

At some future point, the cost of genetic testing could also become a target when Congress seeks other healthcare sectors in their goal to control medical expenses.

—Kristin Althea O’Connor

Related Information:

PBMs Battle Bipartisan Scrutiny as Lawmakers Eye Industry Reform

Public Opinion on Prescription Drugs and Their Prices

Comer Announces Hearing with PBM Executives on Role in Rising Health Care Costs

Comer: Pharmacy Benefit Managers Must be Held Accountable for Role in Rising Drug Prices

Comer Releases Report on PBMs’ Harmful Pricing Tactics and Role in Rising Health Care Costs

Hearing Wrap Up: Oversight Committee Exposes How PBMs Undermine Patient Health and Increase Drug Costs

Video of Hearing: The Role of Pharmacy Benefit Managers in Prescription Drug Markets Part III: Transparency and Accountability

Final Report: The Role of Pharmacy Benefit Managers in Prescription Drug Markets

FTC to Sue Drug Managers over Insulin Prices

FTC Slams Pharmacy Benefit Managers in First Report from Ongoing Investigation

Cigna Subsidiary Evernorth Acquires MDLIVE as Demand for Telehealth Grows Among Insurers and Healthcare Consumers

COVID-19 pandemic has elevated virtual care into the mainstream, creating opportunities to increase access to care, including clinical laboratory testing, and drive down healthcare costs

As the COVID-19 pandemic fuels demand for virtual healthcare, Cigna is acquiring telehealth provider MDLIVE in a move that may indicate the insurance giant anticipates virtual visits playing a major role in healthcare delivery going forward. And, with each acquisition within the telehealth space, the need for clinical laboratories and pathology groups to have a strategy to respond to this trend increases.

The acquisition of MDLIVE by Cigna’s health services subsidiary Evernorth is expected to be completed in the second quarter of 2021, pending regulatory approval, according to an Evernorth press release.

Evernorth, noted Becker’s Hospital Review, is a division of Cigna that “includes pharmacy benefit manager Express Scripts, specialty pharmacy Accredo, and the rest of Cigna’s health service product lines.” And that Evernorth focuses on, “… benefit management, behavioral and clinical care, pharmacy, and intelligence.”

Tim Wentworth, Evernorth’s CEO, anticipates consumers’ desire for telehealth options will not disappear as SARS-CoV-2 infections decrease and the country returns to a new normal.

“Customers expect more convenient care interactions and COVID-19 has rapidly accelerated this need. We see an immediate opportunity to build a new model of care delivery, one that delivers a connected experience with greater affordability, predictability, and simplicity,” Wentworth said in the press release.

Evernorth CEO Tim Wentworth
“With the opportunity to serve millions more people, and with more personalized ways to deliver care, we will have an even greater impact on our customers, clients, and partners,” Evernorth CEO Tim Wentworth (above) said in a company press release. “Combining MDLIVE’s platform and strong network for virtual providers with our comprehensive care solutions, we will be better positioned to optimize the care journey to improve affordability and accessibility and to deliver superior support to health plans as they advance their own care delivery models for the future.” Clinical laboratories that support telehealth providers will want to devise strategies to address this trend. (Photo copyright: Evernorth.)

The MDLIVE website states the telehealth company’s provider network includes physicians who are board certified in:

  • Internal medicine,
  • Family practice,
  • Emergency medicine, and
  • Pediatrics.

The company also provides counseling and behavioral health services by licensed mental health professionals.

Virtual Care Expanded Rapidly Due to COVID-19 Pandemic

Cigna was an early investor in MDLIVE. According to the company’s investors page, other investors include:

  •  Health Care Service Corporation (HCSC), a Chicago-based mutual legal reserve company and independent licensee of the Blue Cross and Blue Shield Association.
  • Sentara Healthcare, a not-for-profit that operates more than 100 sites of care across Virginia and North Carolina.
  • Sutter Health, a not-for-profit integrated health delivery system headquartered in Sacramento, Calif., that operates 24 acute care hospitals and more than 200 clinics in Northern California.
  • And various venture capital and private equity firms.

Cigna began investing in virtual care years before the COVID-19 pandemic arrived in America. In 2018, members of Cigna’s employee-sponsored health plans were given access to virtual urgent care services. In 2019, the partnership was expanded to include online appointments with psychiatrists and behavior health counselors, while some primary care services were added last year.

Then, according to Cigna’s Virtual Investment Day Excerpt Video, virtual care expanded rapidly during the COVID-19 pandemic, with the use of telehealth jumping 46% in 2020 compared to an 11% increase in 2019.

That trend was highlighted last month in a report published in the American Journal of Preventive Medicine (AJPM), titled, “Who Is (and Is Not) Receiving Telemedicine Care During the COVID-19 Pandemic.” The study’s authors found a twentyfold increase in telehealth visits starting in March 2020 among six million people with employer-based health insurance, while office-based encounters fell by almost 50%.

Telehealth Drives New Model of Virtual Healthcare

In the Cigna video, Cigna President and CEO David Cordani says telehealth will be an important driver behind a new model of healthcare delivery.

“The emergence of virtual care is an important example of this,” he states. “We have seen consistent growth in virtual care over the past decade and it has rapidly accelerated further during the COVID pandemic. At Cigna, we see this trend continuing and accelerating further, moving well beyond urgent care to primary, coordinated chronic and behavioral care.”

Cordani added that the MDLIVE acquisition will not only increase patient access to care, but also help Cigna drive down healthcare costs to “below CPI (Consumer Price Index) and ultimately to zero or less.”

Evernorth, however, does not appear to be signaling that its expanded network of virtual providers will serve as gatekeepers for patients scheduling in-office visits with their providers. The Evernorth press release states MDLIVE’s 24/7 virtual care platform will “complement—not replace—the way customers and patients interact with their existing providers.” The goal, Evernorth says, is to achieve:

  • Earlier identification and diagnosis of critical care needs;
  • Faster and more seamless referrals to high-performing providers, including specialists and behavioral health; and
  • More convenient access to appropriate, affordable sites of service, and pharmaceutical fulfillment.

“From cost to complexity to quality, there is tremendous potential for progress in healthcare,” Evernorth President and Chief Operating Officer Eric Palmer said in the company press release. “As one, Evernorth and MDLIVE can accelerate meaningful change. MDLIVE will be part of the new, differentiated, and future-state care solutions that improve the patient experience, close the patient-provider accessibility gap, and bring providers opportunities to augment the services they currently offer. We’ll also have the opportunity to expand the reach of MDLIVE’s capabilities to Evernorth’s clients, as well as Cigna’s US Medical customers and clients.”

Opportunities for Clinical Laboratories That Can Support Virtual Care

Evernorth’s acquisition of MDLIVE expands Cigna’s health services portfolio of healthcare services and may provide opportunities for clinical laboratories that are prepared to support telehealth providers.

As virtual healthcare networks become a signature part of employee-sponsored health plans, clinical laboratories and pathology groups will need to keep pace with a changing healthcare landscape that puts a premium on remote and virtual visits. Outreach to health plans may be necessary to ensure clinical laboratories are included in an ever-growing virtual network.

—Andrea Downing Peck

Related Information:

As Demand for Virtual Health Care Surges, Evernorth Announces Acquisition of Long-Term Partner, MDLIVE

5 Things to Know about Evernorth, Cigna’s Health Services Unit

Who Is (and Isn’t) Receiving Telemedicine Care During the COVID-19 Pandemic

Cigna’s Virtual Investment Day Excerpt Video

Clinical Lab 2.0 Workshop to Gather Healthcare Stakeholders for a Discussion of COVID-19 and How Medical Laboratories Can Add More Value

This fourth edition of the annual event will be held virtually with free registration for pathologists and clinical laboratory professionals

In its fourth year, stakeholders in the clinical laboratory community have promoted thought leadership around the Lab Industry at the Project Santa Fe Foundation’s Clinical Lab 2.0 Workshop. Clinical Lab 2.0 (CL 2.0) which identifies new opportunities for medical labs to add value as the healthcare industry transitions from fee-for-service to value-based delivery models. But how does this concept apply during the era of COVID-19? That’s a key question participants will discuss at the 2020 Clinical Lab 2.0 Workshop, a virtual event scheduled for Oct. 26-27 with a focus on Population Health.

“This workshop will help all clinical laboratory leaders and pathologists to better understand, ‘How do we manage a pandemic, identifying high risk pool, where are the care gaps, and how do we better manage in the future proactively?’” said Khosrow Shotorbani, MBA, MT (ASCP), co-founder of the CL2.0 initiative and a regular speaker at the Executive War College, in an exclusive interview with Dark Daily. He is President and Executive Director of the Project Santa Fe Foundation, the organization that promotes the Clinical 2.0 Movement.

The coronavirus pandemic has “truly elevated the value of the clinical laboratory and diagnostics as one essential component of the care continuum,” he noted. “The value of the SARS-CoV-2 test became immense, globally, and the mantra became ‘test to trace to treat.’”

Project Santa Fe Foundation’s website defines Clinical Laboratory 2.0 as an effort to demonstrate “the power of longitudinal clinical lab data to proactively augment population health in a value-based healthcare environment.” The “goals are to improve the clinical outcomes of populations, help manage population risk, and reduce the overall cost of delivering healthcare,” the CL 2.0 website states.

“It’s about harnessing lab test results and other data that have predictive value and can help us proactively identify individuals that need care,” explained Shotorbani. “In the context of population health or value-based care, our labs potentially can utilize the power of this data to risk-stratify a population for which we are responsible or we can identify gaps in care.”

Clinical Lab 2.0 and the SARS-CoV-2 Pandemic

In the context of COVID-19, “Clinical Lab 2.0 argues that there is a hidden universe of value that can help augment what happens between COVID-19 testing and COVID-19 tracing to convert this reactive approach—meaning we wait for the person to get ill—versus considering who may be most at risk if they were to become infected so that our clinical laboratories can help caregivers create proactive isolation or quarantine strategies,” he added.

Shotorbani then explained how clinical laboratories have data about comorbidities such as diabetes, asthma, heart disease, and immunosuppression that are associated with more serious cases of COVID-19. “This clinical lab data can be harnessed, associated with demographic and risk data such as age and zip codes to help physicians and others identify patients who would be most at risk from a COVID-19 infection,” he noted.

“Historically, the primary focus of a clinical laboratory was very much on the clinical intervention, contacting the care manager physician, and identifying who’s at risk,” he said. But with COVID-19, Shotorbani sees opportunities to forge relationships with public health specialists to encourage what he describes as “consumer engagement.”

“As medical laboratory professionals, we must evolve to accommodate and support the needs of consumers as they take a more active role in their health,” he continued. “This is moving past simply providing lab test results, but to then be a useful diagnostic and therapeutic resource that helps consumers understand their health conditions and what the best next steps are to manage those conditions.”

Khosrow Shotorbani

Khosrow Shotorbani (above) is President, Executive Director, of the Project Santa Fe Foundation and one of the leaders of the Clinical Laboratory 2.0 movement. He is hopeful that the prominent role of medical laboratories in responding to the coronavirus pandemic will lead to an ongoing “seat at the table” in the higher echelons of healthcare organizations. In normal times, “we reside in basements, and we’re done when we release a result,” he said during an exclusive interview with Dark Daily. “COVID-19 was a kick in the rear to get us upstairs to the C-suite, because healthcare CEOs are under the gun to demonstrate more SARS-CoV-2 testing capacity.” Looking ahead, “we want to make sure that our clinical laboratories stay in that seat and design a future delivery model above and beyond COVID-19, maybe even help health systems, hospitals, and other providers drive their strategies.” (Photo copyright: Albuquerque Business First.)

Clinical Laboratory 2.0 Workshop Sessions

The virtual Clinical Lab 2.0 event will kick off with “Population Health and Public Health During a Pandemic,” a keynote session with David Nash, MD, and David N. Sundwall, MD. Nash is Dean Emeritus and Professor of Health Policy at the Jefferson College of Population Health. Sundwall is Professor Emeritus of Public Health at the University of Utah School of Medicine.

They will also participate in a panel that examines “How COVID-19 Changed the Healthcare Ecosystem.” For this session, they’ll be joined by 4sight Health CEO David W. Johnson, and Advocate Aurora Health CEO William P. Santulli.

“None of these are pathologists or come from the lab,” Shotorbani said. “They represent the C-suite and higher organization constituents. These are the healthcare executives who are dealing with their organization’s pain points. As clinical labs, we want to align ourselves to those organizational objectives.”

Pathologist Mark Fung, MD, PhD, will then present a CL 2.0 model for managing COVID-19 or other infectious disease pandemics, followed by a response from the other panelists. Fung is Vice Chair for Population Health in the Department of Pathology and Laboratory Medicine at the Larner College of Medicine at the University of Vermont. He is also on the Project Santa Fe Foundation (PSFF) board of directors.

“Lab 2.0 is a thought leadership organization,” Shotorbani said. “We are developing a template and abstract of this model of clinical laboratory services that other labs can follow while applying some of their own intuition as they make it operational.”

Day Two to the CL 2.0 workshop will feature case studies from the Henry Ford Health System in Detroit and Geisinger Health in Danville, Pa., followed by a discussion with eight PSFF directors. Then, Beth Bailey of TriCore Reference Laboratories in Albuquerque, N.M., will preside over a crowdsourcing session with participation from audience members.

Free Registration for Clinical Laboratories

This will be the first Clinical Lab 2.0 Workshop to be held virtually and registration this year will be free for members of the clinical laboratory community, Shotorbani said. In the past “there has been a hefty tuition to get into this because it’s a very high-touch workshop, especially for senior leaders. But given the critical topic that we’re facing, we felt it was important to waive the cost.”

The Fourth Annual Clinical Lab 2.0 Workshop is partnering this year with the American Society for Clinical Pathology (ASCP), which will provide the software platform for hosting the event, he said. In addition to the live conference sessions, registrants will have access to prerecorded presentations from past workshops. Content will be viewable for six months following the event.

Register for this critical event by clicking here, or by placing this URL in your browser (https://projectsantafefoundation.regfox.com/clinical-lab-20-workshop).

—Stephen Beale

Related Information:

2020 Clinical Lab 2.0 Workshop

Clinical Lab 2.0 Advances as Project Santa Fe Foundation Secures Nonprofit Status, Prepares to Share Case Studies of Medical Laboratories Getting Paid for Adding Value

Helping Medical Laboratories Add Value to Health Systems, Providers, and Payers by Moving from Clinical Lab 1.0 to Clinical Lab 2.0

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