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Clinical Laboratories and Pathology Groups

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Clinical Laboratories and Pathology Groups

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HHS Office of Inspector General Report Finds ‘Steep Decreases’ in Medicare Beneficiaries Receiving Clinical Laboratory Testing During COVID-19 Pandemic’s Early Months

OIG warns that without adequate clinical laboratory testing healthcare organizations could see more deaths and increased spending

Clinical laboratory leaders and pathologists know that lab test volume decreased dramatically during the early months of the COVID-19 pandemic. That was primarily because community lockdowns stopped people from seeing their doctors for the standard range of chronic health conditions, many of which require clinical laboratory tests for diagnosis and chronic disease management.

This early and substantial drop in the volume of medical laboratory testing done in the early months of the pandemic has been confirmed and quantified in a recently published report by US Department of Health and Human Services (HHS) Office of Inspector General (OIG). The report describes the  “steep decreases” in the number of Medicare beneficiaries receiving Medicare Part B lab tests in early 2020, by month, as follows:

• 24% reduction in Medicare Part B test volumes in March
• 53% in April
• 30% in May

The decline of Medicare patients visiting clinical laboratories continued through the balance of 2020. During the first 10 months of the pandemic—March through December 2020—Medicare beneficiaries who pursued lab testing decreased by about 9% compared to the same 10-month period in 2019, according to a news release.

This is a strong indicator that the government’s response to the pandemic had a measurable effect on clinical laboratory testing volume among all age groups, especially among the elderly.

Kyle Fetter

“The cumulative decline in lab test volume across all client labs for [March 9 to April 12] was just over 40%. But in that time, some of our lab customers were hit with a decline of maybe 50% to 60% in test volume,” Kyle Fetter (above), COO, XIFIN, told The Dark Report in 2020. Clinical laboratory testing that originates from a routine patient visit to a doctor—such as blood testing—may have been affected the most, Fetter explained. (Photo copyright: XIFIN.)

Clinical Laboratory Tests Key to Well-being of Patients with Chronic Conditions 

The OIG study was limited to Medicare beneficiaries and thus did not provide information about testing fall-off among people who have private health insurance. But in “From Mid-March, Labs Saw Big Drop in Revenue,” Dark Daily’s sister publication The Dark Report reported early in 2020 on a 40% decline in test volumes and the pandemic’s varying effects on clinical labs, anatomic pathology (AP) groups, and AP subspecialties.

The OIG’s Report in Brief on its study recognized that medical laboratory testing is critical to helping healthcare providers manage chronic conditions that affect patients’ well-being and increase their healthcare costs.

“Lab tests are important for beneficiaries with chronic medical conditions, which are associated with hospitalizations, billions of dollars in Medicare costs, and deaths,” the OIG said.

The OIG audit collected data on the numbers of Medicare beneficiaries receiving all lab tests as well as specific lab tests for Type 2 diabetes mellitus, Chronic kidney disease, and Chronic ischemic heart disease during the period March through December 2020, as compared to the same months in 2019.

According to the OIG’s report:

  • Beneficiaries receiving clinical laboratory tests in general decreased 9%.
  • Beneficiaries with type 2 diabetes receiving lab tests declined 14%.
  • Beneficiaries with chronic kidney disease getting lab tests fell 11%.
  • Beneficiaries with chronic ischemic heart disease receiving lab tests decreased 19%.

“The information may be useful to stakeholders involved in ensuring that beneficiaries avoid the potential bad outcomes that may result from missing or delaying appropriate care,” the report noted.

Overall, 23.7 million Medicare beneficiaries received medical laboratory tests during the first 10 months of the pandemic, down 2.4 million from 26.1 million in 2019, the OIG reported.

Overall Medicare lab test volume and spending also declined during the reported period:

  • Part B clinical laboratory tests for Medicare beneficiaries decreased 15% from 419.9 million tests in 2019 to 358.4 million tests in the first 10 months of the pandemic.
  • Medicare spending for these tests decreased 16% from $6.6 billion in 2019 to $5.5 billion during the first 10 months of the pandemic.

“OIG’s audit of Part B clinical laboratory tests, reimbursed under the Clinical Laboratory Fee Schedule (CLFS) is a useful benchmark for how Medicare beneficiaries received fewer lab tests during the pandemic, especially during the early months,” said Robert Michel, Editor-in-Chief of Dark Daily and The Dark Report.

Medical Laboratory Tests That Were Down Most During COVID-19

The following 10 clinical laboratory tests experienced a 10% or more decline in Medicare beneficiaries seeking them during the pandemic period as compared to pre-pandemic, according to the OIG report:

  • Basic metabolic panel down 18% to 4.8 million Medicare patients.
  • Urinalysis with microscope analysis down 13% to 4.6 million Medicare recipients.
  • Automated urinalysis down 16% to 3.4 million Medicare beneficiaries.
  • Vitamin B12 decreased 11% to 3.4 million Medicare patients.
  • Complete blood count (CBC) down 13% to 3.2 million Medicare beneficiaries.
  • Comprehensive urine culture test fell 16% to three million Medicare patients.
  • Uric acid level blood down 13% to 1.9 million Medicare beneficiaries.
  • Evaluation of antimicrobial drug decreased 17% to 1.74 million Medicare patients.
  • Folic acid level down 12% to 1.73 million Medicare beneficiaries.
  • Urinalysis manual test plunged 28% to 1.4 million Medicare patients.

Beyond Medicare, Clinical Laboratory Test Volume Dropped 40%

OIG was not the only organization to analyze medical laboratory testing volume during the pandemic’s early phase.

The Dark Report correlated data tracked by XIFIN, a San Diego-based health information technology (HIT) company providing revenue cycle management services to clinical laboratories and pathology groups. XIFIN’s collected data showed a steep drop in routine test volume as COVID-19 testing ramped up.

“Starting in the third week of March, we saw medical laboratories suffer a sharp drop in routine testing. But at about the same time, many labs began to offset those revenue losses with testing for the novel coronavirus,” Kyle Fetter, XIFIN’s then Executive Vice President and General Manager of Diagnostic Services told The Dark Report in 2020. Fetter is now XIFIN’S Chief Operating Officer.

“Over four weeks beginning March 9, we saw a cumulative drop of over 40% in test volume from all of our lab clients,” he added.

According to XIFIN’s data, lab specialty organizations experienced the following drop in routine testing during the period March 9 to April 16, 2020:

  • 58% at clinical laboratories.
  • 61% at hospital outreach laboratories.
  • 52% at molecular and genetic testing laboratories.
  • 44% at anatomic pathology (AP) groups.
  • 70% to 80% at AP dermatology and other AP subspecialties.

Many medical laboratories are still recovering from the COVID-19 pandemic’s effects on testing volume.

Notably, the OIG’s report acknowledges the importance of adequate clinical laboratory testing and declares that—without these essential lab tests to manage some healthcare conditions—the healthcare industry could see increased morbidity, deaths, and Medicare spending.   

Donna Marie Pocius

Related Information:

Full Report: The Number of Beneficiaries Who Received Medicare Part B Clinical Laboratory Tests Decreased During the First 10 Months of the COVID-19 Pandemic

Press Release: The Number of Beneficiaries Who Received Medicare Part B Clinical Laboratory Tests Decreased During the First 10 Months of the COVID-19 Pandemic 

Report-in-Brief: The Number of Beneficiaries Who Received Medicare Part B Clinical Laboratory Tests Decreased During the First 10 Months of the COVID-19 Pandemic

From Mid-March Labs Saw Big Drop in Revenue

Where Are the Patients? Hospitals and Clinical Laboratories Wonder When Routine Surgeries, Procedures, and Testing Can Be Restarted Once the COVID-19 Outbreak Eases

Even as some states lift stay-at-home orders, clinical laboratories and pathology groups face uncertainty about how quickly routine daily test referrals will return to normal, pre-pandemic levels

Although strokes and heart attacks do not take vacations, a large and growing number of patients with serious health issues who—in normal times—would require immediate attention are not contacting providers to get needed care. Instead, they are avoiding hospital emergency rooms and clinical laboratories for fear they’ll contract the COVID-19 coronavirus.

Starting in early March, hospitals nationwide suspended elective surgeries and procedures and reduced non-COVID-19 inpatient care to make beds available for the predicted on-rush of COVID-19 patients. However, in parts of the country, the predicted high demand for hospital beds and ventilators failed to materialize. Additionally, due to shelter-in-place orders, patients in many states postponed routine office visits with their primary care physicians.

The collective collapse in the number of elective services provided by hospitals, and the fall-off in patients visiting their doctors, is crushing the financial stability of the nation’s clinical laboratory industry.

In, “From Mid-March, Labs Saw Big Drop in Revenue,” Dark Daily’s sister publication, The Dark Report (TDR) reported on the revenue challenges facing clinical pathology groups and clinical laboratories. Kyle Fetter, Executive Vice President and General Manager of Diagnostic Services at XIFIN, a revenue cycle management company, told TDR that starting in the third week of March, labs suffered a steep decline in routine testing. By the end of March, that fall-off in revenue ranged from 44% for some AP specimens to 70% to 80% for some specialty AP work. During these same weeks, XIFIN’s data showed clinical labs experienced a drop in routine testing volume of 58%, hospital outreach testing declined by 61%, and molecular lab volume went down by 52%.

Using data from multiple sources, The Dark Report estimates that—compared to pre-pandemic levels—the clinical laboratory profession lost almost $900 million in revenue each week—or about $5.2 billion as of April 26. (See Dark Daily, “COVID-19 Triggers a Cash Flow Crash at Clinical Labs Totaling US $5.2 Billion in Past Seven Weeks; Many Labs Are at Brink of Financial Collapse,” May 4, 2020.)

Can Clinical Laboratories Hang on Financially Until COVID-19 Goes Away?

Though most states have not met the nonbinding criteria recommended by the Trump administration for reopening, nearly 40 governors in early May began loosening stay-at-home orders, reported CNN, including allowing elective medical procedures to resume.

Patients may make up for lost time by returning to doctors’ offices for medical laboratory tests and other COVID-19-delayed procedures, and as this happens, clinical laboratories may experience a surge in routine test orders from doctors’ offices and hospital admissions once stay-at-home orders are lifted and fear of COVID-19 has passed.

According to an article published on Axios, a survey of 163 physicians conducted by SVB Leerink—an investment firm that specializes in healthcare and life sciences—found that “roughly three out of four doctors believe patient appointments will resume to normal, pre-coronavirus levels, no earlier than July, and 45% expect a rebound to occur sometime between July and September.” If so, the financial squeeze facing clinical laboratories, pathology groups, and other medical and dental professionals may continue to loosen.

Christopher Freer, DO, an emergency physician at St. Barnabas Hospital in the Bronx and Director of Emergency Medicine at RWJ Barnabas Health
Christopher Freer, DO (above), an emergency physician at St. Barnabas Hospital in the Bronx and Director of Emergency Medicine at RWJBarnabas Health, told CNBC that emergency departments are seeing patients with severe issues, such as stroke and appendicitis, but that those with milder symptoms appear to be staying away. “Even with coronavirus, we still have healthy people who get an illness and need to go to the emergency room,” he said. “Heart attacks don’t stop.” (Photo copyright: USA Today.)

Hospital Finances Are Being Particularly Stressed by Loss of Patients

The impact of stay-at-home orders on hospital systems, in particular, has been dramatic. CNBC reported that RWJBarnabas Health, an 1l-hospital 22-laboratory health system in New Jersey that has 11 emergency departments, totaled just 180 emergency room visits per day during a mid-April weekend, a sharp decline from their 280-per-day-average.

A recent Washington Post article paints an even bleaker picture. Clinicians in the United States, Spain, United Kingdom, and China anecdotally report a “silent sub-epidemic of people who need care at hospitals but dare not come in,” the article states, noting people with symptoms of appendicitis, heart attacks, stroke, infected gall bladders, and bowel obstructions are avoiding hospital emergency rooms.

“Everybody is frightened to come to the ER,” Mount Sinai Health System cardiovascular surgeon John Puskas, MD, told the Post. Though his 60-bed cardiac unit had been repurposed to care for COVID-19 patients, Puskas said the New York hospital system was seeing “dramatically fewer” cardiac patients. 

Concerned that patients may be ignoring signs of heart attack or stroke rather than go to a hospital, the American College of Cardiology launched the “CardioSmart” campaign, which urges anyone experiencing heart symptoms to get prompt treatment and to continue routine appointments, using telehealth technology when available.

“Hospitals have safety measures to protect you from infection,” the CardioSmart website states. “Getting care quickly is critical. You’ll get better faster, and you’ll limit damage to your health.”

However, David Brown, MD, Chief of Emergency Medicine at Massachusetts General Hospital in Boston, argues the number of people having heart-related issues is unlikely to have dropped during the pandemic.

“Strokes and heart attacks don’t take a vacation just because there’s a pandemic,” Brown told The Boston Globe. “They’re still happening. They just aren’t happening as much inside the hospital, which is a major concern to me.”

Many healthcare professionals are worried about the long-term effect from pandemic-delayed preventative and elective procedures.

“The big question is are we going to see a lot more people that have bad outcomes from heart disease, from stroke, from cancer because they’ve put off what they should have had done, but were too afraid to come to the hospital?” Providence St. Joseph Health CEO Rod Hochman, MD, told CNBC.

Hochman, who is Chair-elect of the American Hospital Association (AHA), maintains the aftereffects of people putting off elective surgeries and screening procedures like colonoscopies and mammograms may be felt for years to come.

“We’re possibly going to see a blip in other disease entities as a consequence of doubling down on COVID-19,” he told CNBC.

In clinical laboratories, COVID-19 testing may have somewhat helped offset the drop in routine testing volume. However, the pandemic’s overall financial costs to labs and pathology groups will likely be felt for months to years, as patients slowly return to healthcare providers’ offices and hospitals.

—Andrea Downing Peck

Related Information:

From Mid-March, Labs Saw Big Drop in Revenue

Opening Up America Again

Doctors Worry the Coronavirus Is Keeping Patients Away from U.S. Hospitals as ER Visits Drop: ‘Heart Attacks Don’t Stop.’

When Doctors Think Patient Visits Will Rebound

Coronavirus and Your Heart: Don’t Ignore Heart Symptoms

‘Strokes and Heart Attacks Don’t Take a Vacation.’ So Why Have Emergency Department Visits Sharply Declined?

This is Where All 50 States Stand on Reopening

COVID-19 Triggers a Cash Flow Crash at Clinical Labs Totaling US $5.2 Billion in Past Seven Weeks; Many Labs Are at Brink of Financial Collapse

COVID-19 Pandemic Triggers Decline in Anatomic Pathology Testing and Shows How Digital Pathology, Remote Sign-Out Can Increase Pathology Services

Because of ‘shelter in place’ orders, many anatomic pathologists are reviewing digital images from home during the COVID-19 outbreak and demonstrating the value of whole slide imaging, digital pathology, and CMS’ recent amended remote sign-out policy

COVID-19 is already triggering many permanent changes in the way healthcare is organized and delivered in the United States. However, not until the SARS-CoV-2 pandemic eases will the full extent of these changes become visible. This will be particularly true for anatomic pathology and the profession’s expanded use of telepathology, digital pathology, and whole-slide imaging.

Since early March, specimen referrals and revenues have collapsed at anatomic pathology groups and laboratories across the nation. Dark Daily’s sister publication, The Dark Report (TDR), was first to quantify the magnitude of this collapse in tissue referrals to pathology groups. In an interview with The Dark Report, Kyle Fetter, Executive Vice President and General Manager of Diagnostic Services at XIFIN, Inc., explained that pathology clients using XIFIN’s revenue cycle management services were seeing an average 40% decrease in specimens. And, for certain pathology sub-specialties, the drop-off in specimen referrals was as much as 90%. (See TDR, “From Mid-March, Labs Saw Big Drop in Revenue,” April 20, 2020.)

The College of American Pathologists (CAP) appealed to the Centers for Medicare and Medicaid Services (CMS) to allow pathologists to work remotely. In response, CMS issued a memorandum which stated, “Due to the public health emergency posed by COVID-19 and the urgent need to expand laboratory capacity, CMS is exercising its enforcement discretion to adopt a temporary policy of relaxed enforcement in connection with laboratories located at temporary testing sites under the conditions outlined herein.”

Since then, many physicians, including pathologists, have quickly adapted to working remotely in some form.

Push for Remote Pathology Services Acknowledges Anatomic Pathologist Shortage

The CMS memorandum (QSO-20-21-CLIA), which the federal agency issued to laboratory surveyors on March 26, 2020, notes that CMS will exercise “enforcement discretion to ensure pathologists may review pathology slides remotely” if certain defined conditions are met.

CMS’ decision, which “is applicable only during the COVID-19 public health emergency,” is intended to increase capacity by allowing remote site review of clinical laboratory data, results, and pathology slides.

Ordinarily, CLIA regulations for cytology (a branch of study that focuses on the biological structure of cells) state that cytology slide preparations must be evaluated on the premises of a laboratory that is certified to conduct testing in the subspecialty of cytology. However, a fast-acting Congressional letter sent by 37 members of Congress to US Department of Health and Human Services (HHS) Secretary Alex Azar II, MD, states, “it is unwise and unnecessary to overburden the remaining pathologists with excess work due to staffing shortages, thereby increasing the risk of burnout, medical error, and further shortages in staffing due to exposure. The number of COVID-19 cases will increase and peak over the next two months and will stretch existing healthcare systems to their limits.”

In response to the CMS remote waiver, the CAP committee on Digital and Computational Pathology, and the Informatics committee, published additional guidance on the CAP website.

Decreasing Number of ‘Active Pathologists’ Drives Adoption of Telepathology, Digital Pathology, and Whole-slide Imaging

The current COVID-19 outbreak is just the latest factor in support of enabling remote review of anatomic pathology images and cases. The trend of using telepathology, whole-slide imaging (WSI), and digital pathology systems has been gathering momentum for several years. Powerful economic forces support this trend.

The Dark Report devoted its June 10, 2019, issue to a deep dive of the challenges currently facing the anatomic pathology profession. In particular, TDR noted a study published May 31, 2019, in the Journal of the American Medical Association (JAMA) Network Open, titled, “Trends in the US and Canadian Pathologist Workforces from 2007 to 2017.” The study’s authors—pathologists in the United States and Canada—reported that between 2007 and 2017 the number of active pathologists in the United States decreased from 15,568 to 12,839—a 17.53% decline.

TDR noted that these findings imply there are fewer pathologists in the United States today in active practice to handle the steady increase in the number of cases requiring diagnostic review. In turn, this situation could lead to delays in diagnoses detrimental to patient care.

In fact, the National Health Service (NHS) in the United Kingdom is dealing with exactly this situation. The Telegraph reported that one in four cancer patients in the UK have delays of as much as eight weeks in the diagnosis of their biopsy. It is generally recognized that the UK lacks the number of histopathologists it needs to substantially shorten time to diagnoses. To address this, the NHS is implementing a national digital pathology network featuring Amazon’s Alexa virtual assistant to deliver health advice to the UK’s citizens. (See Dark Daily, “UK’s NHS Will Use Amazon Alexa to Deliver Official Health Advice to Patients in the United Kingdom,” December 2, 2019.)

In the United States, the COVID-19 pandemic created an “immediate need for remote sign-outs, reviews, and consults,” said Mike Bonham, MD, PhD (above), Chief Medical Officer for Proscia, a digital pathology software developer, in an interview with Dark Daily. “In the context of highly relevant workflow and workforce challenges, it reinforces the opportunity for wider adoption of digital pathology.” Prior to the outbreak of COVID-19, several distinct forces were driving adoption and use of digital pathology in combination with traditional microscopy, he said. (Photo copyright: Proscia.)

Distinct Forces Beginning to Reshape Anatomic Pathology

In recent years, the anatomic pathology profession has faced growing financial pressure, a shrinking workforce, and a surge in the global demand for pathology—issues that come at a time when biopsies and cancer diagnostics require greater expertise.

As Dark Daily and The Dark Report previously reported, digital pathology gained momentum starting with the US Food and Drug Administration’s approval to market the Philips IntelliSite Pathology Solution (PIPS) whole-slide imaging (WSI) system in April 2017. The second WSI system cleared by the FDA was the Aperio AT2 DX System from Leica Biosystem Imaging.

When it comes to adopting a digital pathology system (DPS), it is important to realize that digital pathology testing has moved forward at a rapid pace outside the US, explains a new white paper from Dark Daily, titled, “Anatomic Pathology at the Tipping Point? The Economic Case for Adopting Digital Technology and AI Applications Now.”

Gaining knowledge and first-hand experience of digital pathology adoptions is vital to future business development in anatomic pathology services.

Emerging Cancer Diagnostics Using Digital Pathology and Computational Solutions

Digital pathology adoption can be seen in various specialties of cancer care—in particular skin, breast, and prostate. One example is the University of California San Francisco (UCSF) School of Medicine, which adopted digital pathology in February 2015.

The UCSF School of Medicine started with frozen slide sections and moved to the broader volume of pathology slides. Since 2015, UCSF’s School of Medicine has moved toward a fully digital pathology operation and has serialized the adoption by specialty, according to Zoltan Laszik, MD, PhD, attending physician at UCSF and Professor of Clinical Pathology in UCSF’s Departments of Pathology and Laboratory Medicine.

Laszik is among a handful of specialists and digital pathology early adopters who collaborated on the new Dark Daily white paper, which is available for free download.  

Through the adoption of digital pathology, glass slides are digitized using a whole-slide image scanner, then analyzed through image viewing software. Although the basic viewing functionality is not drastically different than that provided by a microscope, digitization does bring improvements in lab efficiency, diagnostic accuracy, image management, workflows, and revenue enhancements.

Additionally, artificial intelligence (AI)-based computational applications have emerged as an integral part of the digital pathology workflow in some settings, the white paper explains.

“These developments are important to anatomic pathologists because the traditional pathology business model continues to transform at a steady pace,” noted Robert L. Michel, Editor-in-Chief of The Dark Report.

Anthony Magliocco, MD, FRCPC, FCAP, President and CEO of Protean BioDiagnostics and former Professor and Chair of Pathology at Moffitt Cancer Center, is featured in the white paper as well. His new pathology service model provides routine pathology services, precision oncology, second opinions, liquid biopsies, genetics, and genomics to cancer centers from a Florida-based specialty laboratory.

In addition to the white paper, Magliocco will share his experience adopting digital pathology during a free webinar, titled, “Streamlined Operations, Increased Revenue, Higher Quality of Care: Conclusive Evidence on the Value of Adopting Digital Pathology in Your Lab.” The webinar takes place Wednesday, May 13, and is hosted by Dark Daily.

To register for this important learning opportunity, click here or place this URL in your web browser: https://www.darkdaily.com/webinar/streamlined-operations-increased-revenue-higher-quality-of-care-conclusive-evidence-on-the-value-of-adopting-digital-pathology-in-your-lab/.

These digital pathology technologies represent an innovative movement shaping the present and future of pathology services. Pathologists wanting to learn more are encouraged to sign up for the May 13 webinar, which will build on the body of evidence and commentary that is included in the new white paper, and which will be available for free on-demand download following the live broadcast.

—Liz Carey

Related Information

Free Download New White Paper: Anatomic Pathology at the Tipping Point? The Economic Case for Adopting Digital Technology and AI Applications Now

To Register for Free Webinar Taking Place on May 13, 1 pm Eastern

Clinical Laboratory Improvement Amendments (CLIA) Laboratory Guidance During COVID-19 Public Health Emergency

Trends in the US and Canadian Pathologist Workforces From 2007 to 2017

UK’s NHS Will Use Amazon Alexa to Deliver Official Health Advice to Patients in the United Kingdom

New Telemedicine Strategies Help Hospitals Address COVID-19

CMS Memorandum: QSO-20-21-CLIA, March 26, 2020

Rush, Carter Lead Successful Effort to Ensure Pathologists are Able to Address Critical Testing Needs During Pandemic

March 25, 2020, Congressional Letter to HHS Secretary Alex Azar II, MD

CAP Secures Remote Work Waiver for Pathologists

Recent Updates on COVID-19: Remote Sign-Out of Cases with Digital Pathology FAQs

Laboratory Staff Turnover: A College of American Pathologists Q-Probes Study of 23 Clinical Laboratories

Is the Profession of Anatomic Pathology Shrinking?

Expert Sees Pros, Cons in DP and WSI Systems

Live Event Update: Executive War College on Laboratory and Pathology Management

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

Every medical laboratory ready to begin the move away from fee-for-service payment and towards value-based reimbursement needs to start offering lab tests that support the practice of precision medicine

Nearly every clinical laboratory and pathology group in America today is aware of the opportunity to provide medical laboratory tests that enable physicians to successfully practice precision medicine. The goal of precision medicine is to enable a patient to get a more accurate diagnosis, receive the most appropriate therapy, and have his/her condition monitored with unprecedented insight during the course of treatment.

The good news for the clinical laboratory industry concerning precision medicine is that it is the fastest-growing sector of lab testing and these are the tests that contribute the greatest value in patient care. For example, molecular and genetic tests are revolutionizing the diagnosis and treatment of infectious disease. These are the clinical lab tests that enable a physician to identify the specific subtype of the bacteria or virus, then help him or her select the therapeutic drug that will have maximum benefit for the patient.

Clinical Laboratories Support Cancer Diagnosis with Companion Diagnostic Tests

It is equally true that the diagnosis and treatment of cancer is undergoing a major transformation. Genetic knowledge is being used to develop both diagnostic tests and new therapies that enable physicians to better diagnose cancer, and then treat it with the drugs identified by a companion diagnostic test as having the best potential to cure the patient or slow the progression of the disease.

But if there is an area of precision medicine with immense potential, it is pharmacogenomics and its associated testing.

In 2015, the Kaiser Family Foundation reported that more than four billion prescriptions were filled in the United States. As science understands more about the human genome, proteome, metabolome, and microbiome (to name just a few of the “omes”), it becomes possible to design clinical laboratory tests that:

1. Contribute to a more accurate diagnosis;

2. Identify which prescription drugs will be of the greatest benefit; and

3. Inform the physician as to which drugs will not be effective and may even be harmful to the patient.

More Good News for Medical Laboratories

There is even more good news. Many clinical laboratories, hospital labs, and pathology groups already have lab instruments capable of performing the tests used in precision medicine. For these labs, no major up-front investment is needed to begin offering tests that allow physicians to practice precision medicine.

“Many of our lab clients got started in this way,” stated Don Rule, MBA, Founder and Chief Executive Officer of Translational Software in Bellevue, Wash. “They realized that their existing lab instruments could run some of the lab tests physicians use when practicing precision medicine. This would be a low-cost way to enter the precision medicine field and they could, on a small scale with minimal risk, begin offering these tests to gain experience, learn more about the market, and identify which such tests would have highest value to the physicians in the communities they serve.”

Is Your Pathology Group Interested in Supporting Precision Medicine?

“For a lab that is serious about understanding the current and future clinical demand for precision medicine tests, several careful steps are recommended,” he continued. “One step is to build demand by educating clinicians and their staffs about the best ways to use these tests to improve patient care. Keep in mind that more of a physician’s reimbursement is now keyed to the patient outcomes they deliver. These doctors recognize that labs helping them do a better job with precision medicine are also helping them demonstrate greater value in the patient care they provide.

“There are other steps required to launch an effective, clinically successful precision medicine testing program,” Rule noted. “For example, labs need to understand how to be paid by the health insurers in their region. That includes getting in-network and teaching physicians and lab staff how to follow each payer’s clinical and coding criteria so that clean claims will be paid in a timely manner.

“Another step is to build the market in a careful fashion,” he emphasized. “For example, labs should identify the thought leaders among their clients and work with them to demonstrate the clinical utility of tests performed in support of precision medicine. And above all, it’s important to focus on patients that are most likely to get some insight from testing. When your lab starts with the right population, it’s remarkable how often you will uncover actionable issues.”

Clinical Labs Can Enter Precision Medicine by Initially Referring Tests

“It’s also feasible for a lab to start its precision medicine strategy by referring out testing in the early stages and using third-party experts to do the interpretations,” Rule advised. “Then, as specimen volume increases, and the lab’s clinical team gains more experience with these molecular and genetic tests, it becomes easy to bring that testing in-house to develop the market further with faster turnaround times and in-house expertise that local physicians appreciate.”

Every clinical lab, hospital lab, and pathology group that is considering how to support precision medicine will want to participate in a special webinar, titled, “What Molecular and Genetic Testing Labs Need to Know to Succeed with Commercialization of Their Precision Medicine Products.” It will take place on Wednesday, March 22, 2017 at 1 PM EDT.

Two expert speakers will cover the essentials that all labs should know about building a market presence in precision medicine. First to present is Don Rule of Translational Software. Rule currently provides a variety of services to more than 80 lab clients, which includes the annotation and interpretation of gene sequences. In addition, Rule and his team provide consulting expertise to help labs develop their strategies for precision medicine, identify the best tests to offer physicians, and develop the steps needed to obtain network status with payers.

Webinar Will Present the Best Successes of Molecular, Genetic Testing Labs

Rule will share the experiences and best successes of the molecular and genetic testing labs he has worked with since 2009. He will discuss the types of lab tests used in precision medicine in different specialties, identify the fastest-growing sectors, and note which instruments already found in most clinical laboratories can be used to provide lab tests used for precision medicine.

Don Rule (above left), Founder and CEO of Translational Software, and Kyle Fetter (above right), Vice President of Advanced Diagnostics at XIFIN, will share their unique insights, knowledge, and experience at developing a precision medicine lab testing program for clinical laboratories that want to build more market share, make the billing/collections team more effective, and increase revenue. (Photo copyright: Dark Daily.)

Don Rule (above left), Founder and CEO of Translational Software, and Kyle Fetter (above right), Vice President of Advanced Diagnostics at XIFIN, will share their unique insights, knowledge, and experience at developing a precision medicine lab testing program for clinical laboratories that want to build more market share, make the billing/collections team more effective, and increase revenue. (Photo copyright: Dark Daily.)

As one example, a growing number of long-term care facilities are using tests to practice precision medicine—and paying for these tests under value-based arrangements—because so many of their patients are taking from 10 to 15 prescriptions each day. If a lab test indicates that the patient may not be getting therapeutic benefit from a specific drug (or that there are negative side effects from the polypharmacy), then the long-term care facility is money ahead because of less spending on drugs and the decreased care costs from patients who remain healthier. In the extreme case, the care facility might lose a patient to a skilled nursing facility due to mental fog or a fall that is precipitated by adverse drug effects.

Making the Case for a Precision Medicine Lab Testing Program

Additional topics to be discussed are:

• How to make the case to administration and the clinicians;

• How to build demand; and

• How to identify thought leaders and work with them to educate the physicians in the lab’s service region.

The second speaker will address the important topic of how to get paid. Kyle Fetter, MBA, is Vice President of Advanced Diagnostics at XIFIN, Inc., based in San Diego. XIFIN provides revenue cycle management (RCM) services to more than 200 labs and handles as many as 300 million lab test claims annually. What this means is that Fetter sees which labs are most successful with their coding, billing, and collections for molecular and genetic tests. He also sees how different payers are handling these claims.

During his presentation, Fetter will provide you and your lab team with valuable knowledge about the best ways to collect the information needed to submit clean claims and be paid promptly. He will illustrate ways to optimize the process of gathering this data and the different software tools that not only make the job easier, but help ensure that a higher proportion of claims are clean and paid at first submission.

Secrets of Preparing for Payer Challenges, Denials, and Audits

But the single best element of Fetter’s presentation will be how labs performing molecular and genetic testing should prepare, as part of the normal course of business, for the inevitable challenges, denials, and audits. He will describe the elements of a system that helps labs be ready to make the case that claims are properly documented, and that they represent appropriate and necessary tests for the patient.

You can find details for this important webinar at this link. (Or copy this URL and paste it into your browser: https://www.darkdaily.com/webinar/what-molecular-and-genetic-testing-labs-need-to-know-to-succeed-with-commercialization-of-their-precision-medicine-products.)

This webinar is perfect for any lab that is already performing molecular and genetic tests, and which is interested in building more market share, making the billing/collections team more effective, and increasing revenue.

For every lab watching the precision medicine space, this webinar is a “must attend” because it delivers to you and your lab team the collective knowledge and insights from two experts who are working with hundreds of the nation’s most successful labs. It is your guaranteed way to get the accurate, relevant information you need to craft your own lab’s strategy for expanding its molecular and genetic testing opportunities.

—Michael McBride

Related Information:

Genetic Tests and Precision Medicine Start to Win Acceptance by Some Payers; Pathologists and Clinical Laboratories Have Opportunity as Advisors

Failure to Pay for New Molecular CPT Codes Created Money Crisis for Clinical Laboratories and Pathology Groups

Confusion, unhappiness, and many unresolved issues remain about the way government and private payers are handling claims for molecular diagnostic tests covered by the 114 new CPT codes
Dust is settling from the fiasco triggered by the Medicare program’s failure to be ready on January 1, 2013, to settle molecular diagnostic test claims filed under the 114 new Tier 1 and Tier 2 molecular CPT codes. The damage is not just limited to Medicare test claims, but also involves private health plans that were waiting to let the Medicare program set precedents on coverage and prices for the new molecular test codes.

Many Clinical Laboratories Must Cope With an Unsatisfactory Situation

Although federal Medicare officials and Medicare contractors have scrambled to rectify the situation, even today there is much unhappiness across the clinical laboratory industry about the current state of things. That unhappiness extends to state Medicaid and private payers because many of these payers have been slow to publish coverage guidelines and prices for these new molecular test CPT codes.

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