Medical laboratories may find opportunities guiding hospital telehealth service physicians in how clinical lab tests are ordered and how the test results are used to select the best therapies
Telehealth is usually thought of as a way for patients in remote settings to access physicians and other caregivers. But now comes a pair of studies that indicate use of telehealth in inpatient settings is outpacing the growth of telehealth for outpatient services.
This is an unexpected development that could give clinical laboratories new opportunities to help improve how physicians in telehealth services use medical laboratory tests to diagnose their patients and select appropriate therapies.
Dual Surveys Compare Inpatient and Outpatient Telehealth
Service Use
Definitive Healthcare (DH) of Framingham, Mass., is an analytics company that provides data on hospitals, physicians, and other healthcare providers, according to the company’s website. A survey conducted by DH found that use of telehealth solutions—such as two-way video webcams and SMS (short message service) text—has increased by inpatient providers from 54% in 2014 to 85% in 2019, a news release stated.
Meanwhile, a second Definitive Healthcare survey suggests
use of telehealth in outpatient physician office settings remained essentially
flat at 44% from 2018 to 2019, according to another news
release.
For the inpatient report, Definitive Healthcare polled 175 c-suite
providers and health
information technology (HIT) directors in hospitals and healthcare systems.
For the outpatient survey, the firm surveyed 270 physicians and outpatient
facilities administrators.
DH’s research was aimed at learning the status of telehealth
adoption, identifying the type of telehealth technology used, and predicting possible
further investments in telehealth technologies.
Most Popular Inpatient Telehealth Technologies
On the inpatient side, 65% of survey respondents said the most used telehealth mode is hub-and-spoke teleconferencing (audio/video communication between sites), Healthcare Dive reported. Also popular:
Fierce
Healthcarereports that the telehealth technologies showing the largest
increase by hospitals and health networks since 2016 are:
Two-way video/webcam between physician and
patient (70%, up from 47%);
Population health management tools, such as SMS
text (19%, up from 12%);
Remote patient monitoring using clinical-grade
devices (14%, up from 8%);
Mobile apps for concierge services (23%, up from
17%).
“Organizations are finding new and creative ways through telehealth to fill gaps in patient care, increase care access, and provide additional services to patient populations outside the walls of their hospital,” Kate Shamsuddin, Definitive Healthcare’s Senior Vice President of Strategy, told Managed Healthcare Executive.
DH believes investments in telehealth will increase at
hospitals as well as physician practices. In fact, 90% of respondents planning
to adopt more telehealth technology indicated they would likely start in the
next 18 months, the news releases state.
Most Popular Outpatient Telehealth Technologies
In the outpatient telehealth survey, 56% of physician
practice respondents indicated patient portals as the
leading telehealth technology, MedCity
News reported. That was followed by:
Hub-and-spoke teleconferencing (42%);
Concierge services (42%);
Clinical- and consumer-grade remote patient
monitoring products (21% and 12%).
While adoption of telehealth technology was flat over the
past year, 68% of physician practices did use two-way video/webcam technology
between physician and patient, which is up from 45% in 2018, Fierce
Healthcare reported.
MedCity News reports that other telehealth technologies in
use at physician practices include:
Mobile apps for concierge service (33%);
Two-way video between physicians (25%);
SMS population management tools (20%).
Telehealth Reimbursement and Interoperability Uncertain
Why do outpatient providers appear slower to adopt
telehealth, even though they generally have more patient encounters than
inpatient facilities and need to reach out further and more often?
Definitive Healthcare reports that 20% of physician practice
respondents are “satisfied with the practice’s current solutions and services,”
and though telehealth reimbursement is improving, 13% are unsure they will be
reimbursed for telehealth services.
The Centers
for Medicare and Medicaid Services (CMS) states that Medicare
Part B covers “certain telehealth services,” and that patients may be
responsible for paying 20% of the Medicare approved amount. CMS also states
that, effective in 2020, Medicare
Advantage plans may “offer more telehealth benefits,” as compared to
traditional Medicare.
The increase in telehealth use at hospitals—as well as its
increased adoption by physician offices—may provide clinical laboratories with opportunities
to assist telehealth doctors with lab test use and ordering. By engaging in telehealth
technology, such as two-way video between physicians, pathologists also may be
able to help with the accuracy of diagnoses and timely and effective patient
care.
Medical fraudsters are targeting Medicare recipients with schemes to persuade them to agree to genetic tests advertised as informing them if they are predisposed to specific chronic diseases or cancer
Medicare scams involving orders for unnecessary, expensive testing are not new. However, clinical laboratory managers and anatomic pathologists need to be aware—particularly those working in hospital and health system labs—that an entirely new wave of fraud involving medical laboratory testing is gaining momentum. This time, instead of specialty cardiology, toxicology, and pain management testing, the scam involves genetic tests.
The shifting focus to genetic tests by fraudsters is a
recent development to which many hospital-based medical laboratory
professionals may be unaware. One reason that the hospital lab managers can be
extraordinarily compliant with federal and state laws is because they don’t
want to threaten the license of their hospital. So, hospital lab staff often
are unaware of the types and extent of fraud involving certain lines of clinical
lab testing that surface in the outpatient/outreach market.
The growing number of fraudulent activities associated with genetic tests is now an issue for federal healthcare fraud investigators. Former US attorney Robert M. Thomas, Jr., a whistleblower attorney, adjunct professor at Boston University School of Law, and a civil rights advocate, wrote in STAT, “What’s going on here is the same pattern of activity that has occurred throughout the healthcare system: a great majority of law-abiding actors and a few that seek out opportunities to game the system of government reimbursement. If you can get a saliva swab and a Medicare number [to provide a specimen for a genetic test] from an unsuspecting senior and falsify a doctor’s order (or find a shady doctor to write one), there’s an easy four-figure sum to be had.”
This aligns with a recent fraud alert from the US Department of Health and Human Services Office of Inspector General (OIG) that states: “Scammers are offering Medicare beneficiaries ‘free’ screenings or cheek swabs for genetic testing to obtain their Medicare information for identity theft or fraudulent billing purposes. Fraudsters are targeting beneficiaries through telemarketing calls, booths at public events, health fairs, and door-to-door visits.
“Beneficiaries who agree to genetic testing or verify
personal or Medicare information may receive a cheek swab, an in-person
screening or a testing kit in the mail, even if it is not ordered by a
physician or medically necessary.
“If Medicare denies the claim, the [Medicare] beneficiary
could be responsible for the entire cost of the test, which could be thousands
of dollars.”
How the Scam Works
As with similar fraud cases, the scamsters pay inducements
to often-unaware patients, physicians, and others to encourage an order for a
genetic test. They then bill federal health programs and private insurers at
inflated prices.
Thomas describes one such scenario used to increase genetic
test orders. “A typical scheme might go something like this: A scammer offers
free ice cream sundaes, gift cards, or even casino chips at a retirement
community or ‘Medicare expo’ for anyone who would like to hear about the
exciting new technology of genetic testing and what it might reveal about ‘your
family’s risk of cancer’ or some other come-on,” explained Thomas. “The scammer
describes this sophisticated technology and downplays or ignores the medical
necessity criteria and the need for a doctor’s order. He or she persuades some
attendees to provide saliva samples and gets identifying information, such as
the senior’s name, date of birth, and Medicare number.
“The scammer then approaches a testing lab, saying, ‘I can find you a lot more business and get you a lot more patients if you share the proceeds with me.’ This, of course, violates the federal anti-bribery law known as the Anti-Kickback Act. But the lure of high-volume profits can be strong enough for some to ignore that roadblock,” he noted.
What Medical Laboratories Need to Know about Fraud and
Genetic Tests
Regardless of how the fraudster proceeds—whether asking the
lab company outright to split profits or by simply sending a high volume of the
same genetic test to the lab without explanation—clinical laboratory managers
should be alert to such activities.
Thomas writes: “An ethical lab would detect that something
is amiss with such a request [involving a genetic test]. An alert lab might
question how an individual, who is not a doctor, has gotten so many saliva
samples and [so much] personal information from so many ‘patients.’ Other [genetic
testing] lab companies may simply play the game without asking enough
questions, or worse, knowing that the tests are not medically necessary, as
required by the rules. The promise of easy money can be just too alluring.”
Physicians and medical laboratories that participate in
these scams are in violation of the federal anti-bribery laws. In “Federal
Investigations into Alleged Kickback Schemes between Hospitals and Physicians
Increase in Number and Scope,” Dark Daily reported on new OIG
investigations into hospitals alleged to have violated anti-kickback
legislation.
Current Cases Involving Genetic Testing Scams
Fraudulent medical test ordering schemes are an ongoing problem that Dark Daily has repeatedly covered. Though the genetic testing aspect is relatively new, there are several recent and current cases that outline the consequences of participating in the new scam.
For example, in February GenomeDx Biosciences Corp. (GenomeDx) agreed to pay $1.99 million to settle a federal case regarding unnecessary genetic testing. In this case, post-operative prostate cancer patients were given a genetic test called Decipher even though they “did not have risk factors necessitating the test,” a Department of Justice (DOJ) press release states. The DOJ claimed GenomeDx fraudulently billed Medicare for the tests, violating the False Claims Act.
A similar federal case involved a doctor who was charged with ordering genetic tests for patients he never saw or treated. Though the doctor was licensed to practice medicine in Florida, the “patients” in question resided in Oklahoma, Arizona, Tennessee, and Mississippi. One patient testified to having responded to a Facebook ad that offered a $100 gift card “for people interested in genetic testing,” a press release from the US Attorney’s Office District of New Jersey stated.
One important recommendation is that medical laboratory
professionals learn how to spot and question potentially fraudulent testing
requests. This shift to genetic testing is just the latest threat. Even clinical
labs that are well prepared could be caught unaware, particularly if the
fraudster sends genetic test orders to multiple labs to process what are
probably medically-unnecessary tests.
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 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.
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.
Clinical laboratory leaders will want to pay close attention to a significant development in Maryland. The state’s All-Payer Medicare program—the nation’s only all-payer hospital rate regulation system—is broadening in scope to include outpatient services starting Jan. 1. The expanded program could impact independent medical laboratories, according to the Maryland Hospital Association (MHA), which told Dark Daily that those labs may see hospitals reaching out to them.
The Centers for Medicare and Medicaid Services (CMS) and the state of Maryland expect to save $1 billion by 2023 in expanding Maryland’s existing All-Payer Model—which focused only on inpatient services since 2014—to also include primary care physicians, skilled nursing facilities, independent clinical laboratories, and more non-hospital settings, according to a CMS statement.
Healthcare Finance notes that it represents “the first time, CMS is holding a state fully at risk for the total cost of care for Medicare beneficiaries.”
Value of Precision Medicine and Coordination of Care to Clinical Labs
“If a patient receives care at a [medical] laboratory outside of a hospital, Maryland hospitals would be looking at ways to coordinate the sharing of that freestanding laboratory information, so that the hospital can coordinate the care of that patient both within and outside the hospital setting,” Erin Cunningham, Communications Manager at MHA, told Dark Daily. Such a coordinating of efforts and sharing of clinical laboratory patient data should help promote precision medicine goals for patients engaged with physicians throughout Maryland’s healthcare networks.
The test of the new program—called the Total Cost of Care (TCOC) Model—also could be an indication that Medicare officials are intent on moving both inpatient and outpatient healthcare providers away from reimbursements based on fees-for-services.
CMS and the state of Maryland said TCOC gives diverse providers incentives to coordinate, center on patients, and save Medicare per capita costs of care each year.
“What they are really doing is tracking how effective we are at managing the quality and the costs of those particular patients that are managed by the physicians and the hospitals together,” Kevin Kelbly, VP and Chief Financial Officer at Carroll Hospital in Westminster, told the Carroll County Times. “They will have set up certain parameters. If we hit those parameters, there could be a shared savings opportunity between the hospitals and the providers,” he added. (Photo copyright: LifeBridge Health.)
The TCOC runs from 2019 through 2023, when it may be extended by officials for an additional five years.
How Does it Work?
The TCOC Model, like the earlier All-Payer Model, will limit Medicare’s costs in Maryland through a per capita, population-based payment, Healthcare Finance explained.
It includes three programs, including the:
Maryland Primary Care Program (MDPCP), designed to incentivize physician practices by giving additional per beneficiary, per month CMS payments, and incentives for physicians to reduce the number of patients hospitalize;
Care Redesign Program (CRP), which is a way for hospitals to make incentive payments to their partners in care. In essence, rewards may be given to providers that work efficiently with the hospital to improve quality of services; and,
Hospital Payment Program, a population-based payment model that reimburses Maryland hospitals annually for hospital services. CMS provides financial incentives to hospitals that succeed in value-based care and reducing unnecessary hospitalizations and readmissions.
CMS and Maryland officials also identified these six high-priority areas for population health improvement:
Substance-use disorder;
Diabetes;
Hypertension;
Obesity;
Smoking; and
Asthma.
“We are going to save about a billion dollars over the next five years, but we are also providing better quality healthcare. So it’s going to affect real people in Maryland, and it helps us keep the whole healthcare system from collapsing, quite frankly,” Maryland Gov. Larry Hogan, told the Carroll County Times.
OneCare in Vermont, Different Approach to One Payer
Maryland is not the only state to try an all-payer model. Vermont’s OneCare is a statewide accountable care organization (ACO) model involving the state’s largest payers: Medicare, Medicaid, and Blue Cross and Blue Shield of Vermont, Healthcare Dive pointed out. The program aims to increase the number of patients under risk-based contracting and, simultaneously, encourage providers to meet population health goals, a Commonwealth Fund report noted.
Both Maryland’s and Vermont’s efforts indicate that payment plans which include value-based incentives are no longer just theory. In some markets, fees-for-service payment models may be gone for good.
Clinical laboratory leaders may want to touch base with their colleagues in Maryland and Vermont to learn how labs in those states are engaging providers and performing under payment programs that, if successful, could replace existing Medicare payment models in other states.
Studies show medical laboratories may be particularly hit by adjustments to hospital chargemasters as hospitals prepare to comply with Medicare’s New Transparency Rule
Recently, Kaiser Health News (KHN) published a story about a $48,329 bill for allergy testing that cast a spotlight on hospital chargemaster rates just as healthcare providers are preparing to publish their prices online to comply with a new Centers for Medicare and Medicaid Services (CMS) rule aimed at increasing pricing transparency in healthcare. The rule goes into effect January 1, 2019.
The patient—a Eureka, Calif., resident with a persistent rash—had received an invoice for more than $3000 from her in-network provider.
Though this type of allergy skin-patch testing is usually performed in an outpatient setting by a trained professional, such as an allergist or dermatologist, the patient elected to have the testing performed at Stanford Health Care (Stanford), a respected academic medical system with multiple hospitals, outpatient services, and physician practices.
The patient’s insurance plan, Anthem Blue Cross (Anthem), paid $11,376 of the $48,329 amount billed by Stanford Health Care, which was the rate negotiated between the insurer and Stanford, Becker’s Healthcare reported. The patient ultimately paid $1,561 out-of-pocket.
So, where did that $48,329 in total charges come from? Experts pointed to the provider’s chargemaster. A chargemaster (AKA, charge description master or CDM) lists a hospital’s prices for services, suppliers and procedures, and is used by providers to create a patient’s bill, according to California’s Office of Statewide Health Planning and Development (OSHPD).
Chargemasters note high prices beyond hospitals’ costs and may be considered jumping off points for hospitals to use in invoicing payers and patients, RevCycleIntelligence explained.
Hospital representatives will negotiate with insurance companies, asking them to pay a discounted rate off the chargemaster list. A patient with health insurance accesses care at that negotiated rate and perhaps has responsibility for a share of that amount as well.
However, an out-of-network patient, uninsured person, or cash customer who receives care will likely be billed the full chargemaster rate.
In a statement to KHN, Stanford explained that the California woman’s care was customized and, therefore, costly: “We conducted a comprehensive evaluation of the patient and her environmental exposures and meticulously selected appropriate allergens, which required obtaining and preparing putative allergens on an individual basis.”
Johns Hopkins researchers Ge Bai, PhD, CPA (left), and Gerard Anderson, PhD (right), authored a study published in Health Affairs that shows “Hospitals on average charged more than 20 times their own costs in 2013 in their CT scan and anesthesiology departments.” Hospitals with clinical laboratory outreach programs will want to consider how their patients may respond as new federal price transparency requirements make it easier for patients to see medical laboratory test prices in advance of service. (Photo copyright: Johns Hopkins University.)
Now is a Good Time for Clinical Laboratories to Make Chargemaster Changes
Some organizations, such as the Healthcare Financial Management Association (HFMA), are calling for chargemaster adjustments as part of a comprehensive plan to improve transparency and lower healthcare costs. This falls in line with the new CMS rule requiring hospitals to post prices online starting Jan.1, 2019.
In fact, hospital medical laboratories, which cannot distinguish their services from competitors, may be impacted by the new CMS rule perhaps more than other services, the HFMA analysis warned.
“The initial impact for healthcare organizations, if they have not already experienced it, will be on commoditized services such as [clinical] lab and imaging. Consumers do not differentiate between high and low quality on a commoditized service the same way a physician might, which means cost plays a larger role in consumers’ decision making.” That’s according to Nicholas Malenka, Senior Consultant, GE Healthcare Partners, and author of the HFMA report. He advises providers to do chargemaster adjustments that relate charges to costs of services, competitors’ charges, and national data.
Are Chargemaster Charges Truly Excessive? Johns Hopkins Researchers Say ‘Yes!’
Most hospitals with 50 beds or more have a charge-to-cost ratio of 4.32. In other words, $432 is charged when the actual cost of a service is $100, according a study conducted by Johns Hopkins University and published in Health Affairs.
The researchers also noted in a news release about their findings titled, “Hospitals Charge More than 20 Times Cost on Some Procedures to Maximize Revenue,” that:
Charge-to-cost ratios range from 1.8 for routine inpatient care to 28.5 for a CT scan; and,
Hospitals with $100 in CT costs may charge an uninsured patient or out-of-network patient $2,850 for the service.
“Hospitals apparently markup higher in the departments with more complex services because it is more difficult for patients to compare prices in these departments,” lead author Ge Bai, PhD, CPA, Associate Professor at Johns Hopkins Carey Business School, noted in the news release.
“(The bills for high charges) affect uninsured and out-of-network patients, auto insurers, and casualty and workers’ compensation insurers. The high charges have led to personal bankruptcy, avoidance of needed medical services, and much higher insurance premiums,” co-author Gerard Anderson, PhD, Professor of Health Policy and Management at Johns Hopkins Bloomberg School of Public Health, stated in the news release.
Legal Issues Possible for Hospitals, Medical Laboratories, Other Providers
Still another study published in the American Journal of Managed Care (AJMC) explored the legality of “surprising” uninsured and out-of-network patients with bills at the chargemaster rates. It found that contract law supports market-negotiated rates—not chargemaster rates that do not reflect actual costs or the market.
“Patients and payers should know that they are under no obligation to pay surprise bills containing chargemaster rates, and state attorneys generally can use the law to prevent providers from pursing chargemaster-related collection efforts against patients,” the researchers wrote.
Labs Need to Get Involved
Clinical laboratory leaders in hospitals and health systems are advised to reach out to hospital chargemaster coordinators to ensure the chargemaster, as it relates to the lab, is inclusive, accurate, and in sync with competitive market data. Independent medical laboratories may want to similarly check their chargemasters to see how their lab test prices compare to the prices charged by other labs serving the same community.