News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel

News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel
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Class Action Lawsuit Filed in California Names Quest Diagnostics Incorporated as Defendant and Alleges Violation of Antitrust Laws involving Medical Lab Testing

Quest has not yet commented on the lawsuit, which was filed by three individuals who had clinical laboratory tests performed by the nation’s largest public lab company

In California last Thursday, three California residents filed a class action lawsuit charging Quest Diagnostics Incorporated (NYSE: DGX) with acquiring competitor medical labs, paying kickbacks to physicians, and developing exclusionary agreements with health insurers to monopolize the market for clinical laboratory testing in Northern California.

Filed in U.S. District Court for the Northern District of California, the complaint cites violations of the federal Sherman Act and the California Unfair Competition Law, Unfair Practices Act, and the Cartwright Act on behalf of California residents Christi Cruz of San Jose, Colleen Eastman of Hollister, and Carmen Mendez of, Milpitas. All three plaintiffs have used Quest laboratories and paid Quest Diagnostics Incorporated of Madison, New Jersey, for those testing services, the complaint says.

Lawsuit About Clinical Lab Testing Services Filed in Federal Court

The complaint was filed in the court’s San Francisco Division. In the court papers, lawyers for the three plaintiffs explain that injury to competition is manifest in three ways: above-competitive prices, inferior quality of testing, and reduction in choice among providers of routine diagnostic testing. “There is ample evidence that Quest has controlled prices in the relevant market in Northern California since at least 2011,” the complaint explains. (more…)

Narrow Networks Mean Shrinking Opportunity for Pathology and Clinical Medical Laboratories

Pathology groups and medical laboratories may benefit if federal and state legislators legislate broadening of provider networks

Insurers are increasingly using narrow networks as a business strategy to control costs. As a consequence, more consumers are complaining even as some excluded providers are suing health insurers. For pathologists and clinical laboratory managers, this accelerating trend of excluding providers means increasingly restricted access to patients.

Health Insurers Walk a Fine Line between Cost and Access

Many health plans currently sold on the new state insurance exchanges offer substantially smaller networks of providers than was typical in recent years, according to a story published in Modern Healthcare. The payers say narrower networks are necessary for two reasons.

First, narrow networks can keep premiums affordable. Second, health insurers say narrow networks help them address the requirements of the Patient Protection and Affordable Care Act (ACA). (more…)

As Health Insurers Narrow Their Networks, Some Hospitals and Physicians Find Themselves Excluded, as Happened to Many Clinical Pathology Laboratories

Health insurers may be poised to leave hospitals and physicians out of their networks, thus potentially cutting out pathologists and clinical laboratories

Clinical laboratory companies that find themselves excluded from health insurers’ provider networks do not need to feel like they were singled out. That’s because health insurers are narrowing their networks by also excluding hospitals and physicians.

Years ago, the “narrow network” strategy was used by HMOs and health insurers to extract rock bottom prices from hospitals, physicians, and medical laboratories. Now this strategy is returning as health insurers develop what they call narrow networks. (more…)