Jun 22, 2015 | Coding, Billing, and Collections, Digital Pathology, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Managed Care Contracts & Payer Reimbursement, Management & Operations
Innovative medical laboratories shared their successes in improving lab test utilization that included physician engagement and close monitoring of key metrics
DATELINE: ORLANDO, FLORIDA—One big challenge facing medical laboratories and anatomic pathology groups in the United States today is the need to transition from a transaction-based business model (increasing specimen volume leads to increasing revenue) to a value-based business model (helping providers improve their use of clinical laboratory tests in ways that measurably improve patient outcomes while controlling or reducing the cost of care.)
Two trends reinforce the need for clinical laboratories to craft strategies to develop new ways to add value to lab testing services.
One trend is the move by Medicare and private health insurers to shift reimbursement for providers away from fee-for-service and toward bundled reimbursement and budgeted reimbursement.
The second trend is the emergence of integrated clinical care organizations. The most visible of these are accountable care organizations (ACO) and patient-centered medical homes (PCMH). What these care delivery organizations have in common is that they require hospitals, physicians, clinical laboratories, imaging centers, nursing homes and other types of providers to work together more effectively so that patients receive healthcare in a seamless fashion because there is a continuum: primary care to specialty care to acute care and back again. (more…)
May 6, 2015 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Digital Pathology, Instruments & Equipment, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Sales and Marketing, Managed Care Contracts & Payer Reimbursement, Management & Operations, News From Dark Daily
Primary themes were healthcare’s transition away from fee-for-service and how innovative medical laboratories are delivering more value with lab testing services
NEW ORLEANS, LA.—Two clear themes for clinical labs and pathology groups emerged from yesterday’s opening presentations at the 20th annual gathering of the Executive War College on Laboratory and Pathology Management.
Transitioning from Fee-For-Service to Value-based Reimbursement Programs
Theme one is that the pace of transformation within the U.S. healthcare system is accelerating. In his opening remarks, Executive War College Founder Robert L. Michel warned medical laboratory professionals that they must not allow their lab organizations to be unprepared or unresponsive to the changes now unfolding across the nation’s healthcare system.
In particular, Michel reminded the more than 850 lab executives and pathologists in the audience that fee-for-service payment for clinical laboratory tests and anatomic pathology services will not remain the dominant form of reimbursement for much longer. “This market trend is aptly described as ‘volume to value,’” noted Michel. “For decades, labs maximized revenue and operating profits by maximizing the volume of specimens that they tested. Those days are coming to an end. Healthcare will increasingly want lab testing services to be high value. These lab services will be paid as part of a bundle, or included in the different forms of global payments and budgeted payments that are made to integrated care delivery organizations, such as ACOs and patient-centered medical homes.” (more…)
May 1, 2015 | Coding, Billing, and Collections, Laboratory Management and Operations, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement
If bundled payment becomes more common in treatment of cancer, then anatomic pathologists need a strategy to demonstrate their clinical value to physicians and payers
MD Anderson Cancer Center and UnitedHealthcare (NYSE: UNH) announced a bundled payment agreement for the treatment of certain types of cancer. This development has implications for anatomic pathologist who provide cancer testing services to hospitals throughout the United States.
The new three-year pilot at MD Anderson’s Head and Neck Center in Houston, Texas, is the first use of a bundled payment model in a large, comprehensive cancer center. Officials say it is expected to lower costs while improving the quality of patient care and outcomes. As many as 150 patients with head and neck cancer who are enrolled in employer-sponsored UnitedHealthcare (UHC) plans will participate in the pilot.
“For the last five years, MD Anderson and its Institute for Cancer Care Innovation have been looking at how to best approach a single price for treating cancers. It is a complex question because cancer is a complex disease and each patient unique,” stated Thomas W. Feeley, M.D., Head of Anesthesiology and Critical Care, and Head of the Institute, in an MD Anderson news release. “Bundled pricing is something that patients and care providers want, and this is our first opportunity to better understand how we can manage costs without sacrificing quality care and patient outcomes.” (more…)
Apr 1, 2015 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology
Alternative payment models and value-based payment schemes create financial unknowns for clinical laboratories and anatomic pathology groups
What happens to pathologists and clinical laboratories when fee-for-service reimbursement ceases to be the primary payment method for anatomic pathology services and medical laboratory tests?
After all, fee-for-service reimbursement for lab tests is what underpins today’s financial model for lab test services. Under this transaction-based business arrangement, a clinical laboratory that can increase its specimen volume will realize a lower average cost-per-test because of economies of scale within the lab. At the same time, the lower costs mean a bigger net margin available from profit, given the fixed price of the reimbursement for lab tests.
So what is a medical laboratory to do as healthcare shifts to a value-based reimbursement (VBR) model, formerly known as pay-for-performance? The answer to that question won’t take long to answer because of a recent announcement by the Department of Health and Human Services (HHS). (more…)
Mar 31, 2014 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Instruments & Equipment, Laboratory Hiring & Human Resources, Laboratory Instruments & Laboratory Equipment, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement, Management & Operations, News From Dark Daily
Failing finances at technical pathology laboratories may be the most immediate concern for many pathology group practices
Many clinical laboratories and anatomic pathology groups now recognize the new reality of the American healthcare system: less reimbursement for laboratory testing. On one hand, the fee-for-service prices for lab tests paid by government and private payers have been aggressively slashed.
On the other hand, all payers have become stubbornly resistant to issuing coverage guidelines and setting adequate prices for the flood of new molecular assays and gene tests coming to market.
These trends have already brought a handful of medical laboratories and pathology practices to the point of bankruptcy, sale, or closure. This is definitely true for the technical laboratories owned by many local pathology groups, which have become unprofitable due to fee cuts. (See below.) (more…)
