News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups
Hosted by Robert Michel

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Clinical Laboratories and Pathology Groups
Hosted by Robert Michel
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Even as Digital Pathology Is Poised to Be Disruptive in Primary Diagnosis, Most Anatomic Pathology Groups Are Unprepared for How Their Incomes Will Change

Aug 14, 2017 | Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing, Management & Operations

Pathologists and practice administrators should prepare a strategy and a timetable for their group’s acquisition and deployment of a digital pathology system and whole slide imaging

Anatomic pathology is a medical specialty at the brink of a major technological disruption. FDA clearance of the first digital pathology system and whole slide imaging (WSI) for primary diagnosis means that every surgical pathologist will soon need to decide when to adopt this technology to avoid declines in group revenue and pathologist compensation.

Not in decades have pathologists faced a comparable dual threat. One threat is the use of digital pathology and WSI for primary diagnosis in ways that deliver faster answers to referring physicians, while creating new business models for anatomic pathology groups. At greatest risk from this technology, however, may be sub-specialist pathologists who depend on specialty referrals and second-opinion consults.

Second Threat Is How Digital Pathology Can Erode Pathology Group’s Revenue

The second threat is how failure to adopt digital pathology and WSI at the right time in the market cycle will put a pathology group’s revenue at risk, while causing pathologist compensation to erode. Pathology groups that are quick to adopt digital pathology and whole slide imaging are expected to gain clinical advantage and additional case referrals, while pathology groups that defer adoption will probably lose market share—and the revenue associated with those lost case referrals.

How Fast Will Pathology Groups Act to Implement Digital Pathology?

It was last April when the FDA cleared the first digital pathology system and whole slide imaging for use in the primary diagnosis of biopsied tissue and resection cases. With clearance to market of the Philips IntelliSite Pathology Solution (PIPS), it is expected that other companies will submit their digital pathology systems for FDA review as well. As that happens, the market for digital pathology systems will expand and become more competitive.

“How fast pathologists in the United States adopt digital pathology for primary diagnosis is the big question,” observed Robert L. Michel, Editor-In-Chief of The Dark Report, Dark Daily’s sister publication. “We’ve interviewed pathologists at several community pathology group practices who currently use digital pathology and whole slide images for things like tumor boards, second opinion consults within and without their practice, and teaching purposes. They have strong opinions about how quickly they want their group to begin using a digital pathology system for primary diagnosis.

“For example, Advanced Pathology Associates (APA) in Rockville, Md., is a group with 15 pathologists who cover seven hospitals,” stated Michel. “APA was the community pathology group site for the study data Philips needed to submit with its FDA pre-market application. They had the system for the nine-month trial and used it to evaluate 500 cases and thousands of glass slides and WSIs. APA returned the system at the conclusion of the study, but pathologists at APA are already in the process of acquiring their own digital pathology system to use for primary diagnosis.”

Anatomic Pathology Group Went Hands-on with Digital Pathology System

In a story The Dark Report published about Advanced Pathology Associates, pathologist Nicolas Cacciabeve, MD, APA’s Managing Partner, commented, “Because we had the opportunity to be hands-on with this digital pathology system, we saw how it changes daily workflow, improves the ergonomics of reading cases, and contributes to increased productivity.”

Cacciabeve identified the immediate benefits APA will accrue after it acquires its own digital pathology system and begins to use it for primary diagnosis. “[Having a digital pathology system] … also opens new opportunities for our pathologists to add more value—whether it is handling more complex cases through real-time consultation, or through better data management and image retrieval, or freeing up pathologists to get out of the lab to collaborate with clinicians.”

Pathologist Clive Taylor, MD, Considers DP’s Clearance to Be ‘Huge’

The FDA’s clearance of the first digital pathology system was called “huge” by noted pathologist Clive Taylor, MD, PhD, a professor of pathology at the Keck School of Medicine at the University of Southern California (where he served as Chair of Pathology from 1984 to 2009) in an interview with The Dark Report published on July 17.

“The FDA’s clearance of this system for primary diagnosis is huge,” stated Taylor. “… I say that because digital slide scanners in many pathology departments around the country are used secondarily. For example, a pathologist will look at a glass biopsy slide today and think, ‘I should scan this to get a score, or an accurate count, or to send it to a colleague in Washington or London or some place.’ In that sense, pathology labs are using whole slide imaging for secondary purposes.

“The FDA clearance of whole slide imaging for primary diagnostics will foster changes in anatomic pathology departments that will improve the accuracy and speed of diagnosis and drastically reduce the time it takes to get second opinions and to reach a primary diagnosis,” Taylor predicted.

Pathologists, Practice Administrators Need a Strategy for Digital Pathology

Because of the potential for digital pathology systems and whole slide imaging to be disruptive to both the clinical practice of pathology and the revenue and income earned by pathologists, it is recommended that pathology practice administrators and pathologist business leaders of their respective groups understand this new technology and how early-adopter pathology labs are using it to add value to their diagnostic services while generating new streams of revenue.

The four expert speakers for this critical Dark Daily webinar are (clockwise from upper left): Keith Kaplan, MD, Chief Medical Officer, Corista, Concord, Mass.; Liron Pantanowitz, MD, Professor of Pathology and Biomedical Informatics at the University of Pittsburgh Medical Center, Pittsburgh; Isaac R. Grindeland, MD, Gastrointestinal Pathology, Incyte Diagnostics, Spokane Valley, Wash.; and Dan Angress, for ClearPath Derm of Dayton, Ohio, and President of Angress Consulting, LLC, Los Angeles, Calif. (Photo copyright: Dark Daily.)

To give practice administrators and interested pathologists this comprehensive knowledge of digital pathology and whole slide imaging, Dark Daily is presenting a special webinar, titled, “Primary Diagnosis with Digital Pathology Systems and Whole Slide Images: What Every Pathologist Needs to Know, Why It Will Be Disruptive, and How Innovative Pathology Groups Are Already Making Money with DP.”

This critical webinar takes place on Thursday, August 17, 2017 at 1:00 PM EDT.

Essential Knowledge about Digital Pathology Systems, Whole Slide Imaging

The webinar is organized to help all pathology groups, academic pathology departments, and pathology laboratories understand:

  • The current capabilities of the technology for digital pathology and WSI;
  • How these technologies are evolving in ways that add functionality and improve productivity; and—most importantly,
  • Two case studies of pathology groups already using digital pathology and WSI imaging to add clinical value and develop new sources of revenue.

Speaking during this webinar will be:

  • Keith Kaplan, MD, Chief Medical Officer, Corista, Concord, Mass.: For nearly a decade, Kaplan has been one of the leading commentators on the use of digital technologies and Web 2.0 capabilities in pathology. He will provide strategic context about why the FDA’s clearance of a digital pathology system for use in primary diagnosis is a trigger event for all pathology groups.
  • Liron Pantanowitz, MD, Professor of Pathology and Biomedical Informatics at the University of Pittsburgh Medical Center, Pittsburgh, Pa.: An internationally known expert on the use of digital pathology systems and whole slide imaging, Pantanowitz will give webinar participants a concise understanding of the technology’s current capabilities; how it is being used at UPMC; the lessons learned in the use of digital pathology to support UPMC’s international pathology collaborations; and what technology advances to expect in the near future.
  • Dan Angress, for ClearPath Derm of Dayton, Ohio, and President of Angress Consulting, LLC, Los Angeles, Calif.: This is a fascinating case study of how ClearPath Derm is using digital pathology capabilities to support added value services for its referring physicians that, most importantly, generate additional revenue for the pathology group.
  • Isaac R. Grindeland, MD, Gastrointestinal Pathology, Incyte Diagnostics, Spokane Valley, Wash.: This regional pathology super-group has 40 pathologists, four anchor locations, and contracts with multiple hospitals. Grindeland will explain how Incyte leverages its digital pathology capabilities to improve productivity and performance, while better meeting the needs of its hospital and physician clients.

Preparing Pathology Groups for Disruptive Potential of DB, WSI

Because of the potential for digital pathology systems and whole slide imaging to disrupt many long-established clinical practices, while at the same time creating new financial winners and losers among the nation’s pathology groups, it is imperative that pathologists and practice administrators gain the necessary knowledge to prepare their groups. Armed with these insights, they then can develop timely and appropriate strategies to ensure their group’s clinical excellence and financial sustainability moving forward.

For details about the August 17 webinar and to register, use this link (or copy this URL and paste it into your browser: https://ddaily.wpengine.com/webinar/primary-diagnosis-with-digital-pathology-systems-and-whole-slide-images-what-every-pathologist-needs-to-know-why-it-will-be-disruptive-and-how-innovative-pathology-groups-are-already-making-money-w).

—Michael McBride

Related Information:

Primary Diagnosis with Digital Pathology Systems and Whole Slide Images: What Every Pathologist Needs to Know, Why It Will Be Disruptive, and How Innovative Pathology Groups Are Already Making Money with DP

FDA Allows Marketing of First Whole Slide Imaging System for Digital Pathology

Whole Slide Imaging In Pathology: Advantages, Limitations, and Emerging Perspectives

Digital Images and the Future of Digital Pathology, Liron Pantanowitz, MD

Philips Awarded FDA Clearance for Digital Pathology Solution for Primary Diagnostic Use

What Does FDA Approval of a Digital Pathology System for Use in Primary Diagnosis Mean for the Pathology Industry? New Dark Daily Webinar to Provide Answers and Insights for Pathologists and Pathology Practice Administrators

Dark Daily Story on Pathology 2.0 and Digital Pathology Blog

 

Coming PAMA Price Cuts to Medicare Clinical Lab Fees Expected to Be Heavy Financial Blow to Hospital Laboratory Outreach Programs

Dec 12, 2016 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Testing

All hospital labs need to understand the negative financial impact to their labs and have a plan to absorb the fee cuts and remain clinically and financially viable

If you believe some experts, in just 13 months many of the nation’s hospital medical laboratory outreach programs will experience a financial disaster that could put them out of business and reduce Medicare patients’ access to lab testing services. This event happens on January 1, 2018, when Medicare officials implement substantial cuts to the Part B Clinical Laboratory Fee Schedule (CLFS).

These fee cuts are the result of the section of the Protecting Access to Medicare Act (PAMA) that requires the Centers for Medicare and Medicaid Services (CMS) to collect private-payer lab test price data from the nation’s medical laboratories and use that data to establish fees for the CLFS. CMS officials estimate that the fee cuts will reduce payments to labs by as much as $400 million in 2018.

What puts the laboratory outreach programs of the nation’s hospitals and health systems at significant financial risk is the fact that CMS, as verified by reports issued by the Office of the Inspector General (OIG), intends to reduce fees on the 25 highest-volume highly-automated lab tests that make up 59% of what Medicare spent on clinical laboratory tests in 2014.

Stated differently, the OIG says that, in 2014, Medicare paid a total of $7 billion for clinical laboratory tests. Of this total, the Medicare program paid $4.1 billion for the top 25 tests. In a report issued in September, the OIG wrote, “Changes in the Medicare payment rates for these 25 tests could have a significant impact on overall Medicare spending for lab tests when the new payment system for lab tests goes into effect in 2018.” [Italics by Dark Daily.] (more…)

How Smart Clinical Laboratories and Genetic Testing Labs Are Collecting More Revenue by Pricing Tests to Meet the Expectations of Patients

May 23, 2016 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology

By rethinking how their medical labs relate to health insurers, physicians, and patients, a handful of progressive lab companies are enjoying increased revenue while also lifting patient and payer satisfaction

There is widespread agreement across the clinical laboratory industry that it is becoming ever more difficult to have health plans reimburse claims for common tests, molecular assays, and genetic tests in a reliable and consistent manner. Many lab companies report that they are experiencing high rates of denied claims. Moreover—even for claims reimbursed by payers—the amount paid will vary on claims for the same type of lab test.

“Essentially, on this point, the consistent theme we hear from many lab companies—particularly those labs with a menu of proprietary, specialized molecular and genetic tests—is that it is now almost a crap-shoot to submit lab test claims to many payers and see timely and predictable reimbursement for those claims,” stated Robert L. Michel, Editor-In-Chief of Dark Daily’s sister publication, The Dark Report. “One could say that, today, the function of billing patients and payers for clinical lab testing has become financial quicksand for most labs. By following traditional coding, billing, and collection practices, in today’s healthcare market, they find themselves sinking steadily deeper in this financial quicksand.” (more…)

Because of Sizeable Deductibles, More Patients Owe More Money to Clinical Pathology Laboratories, Spurring Labs to Get Smarter about Collecting from Patients

Jun 15, 2015 | Coding, Billing, and Collections, Laboratory Management and Operations, Laboratory Pathology, Laboratory Testing

One Arizona medical laboratory focused on collecting from patients who were overdue on amounts averaging just $40 and, in 18 months, collected $3.2 million!

In today’s clinical laboratory marketplace, competency in revenue management is becoming just as important as clinical excellence. Blame it on these multi-year trends: shrinking lab budgets, Medicare price cuts, and payers excluding labs from narrow networks.

At the dawn of this decade—just five years ago—few pathologists and clinical lab executives would have predicted that the financial survival of their lab organizations would depend upon becoming more proficient and more sophisticated with billing and collections. Yet this is now a necessary response to the year-over-year decline in lab prices and revenue experienced since 2010. (more…)

Most Clinical Laboratories and Pathology Groups Unprepared to Help Client Physicians Meet Meaningful Use Stage 2 Criteria

Mar 19, 2015 | Digital Pathology, Instruments & Equipment, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Managed Care Contracts & Payer Reimbursement, Management & Operations

Because of the failure of many EHR products to obtain MU Stage 2 certification, physicians using those EHRs are being forced to buy and implement a different EHR

Like the jaws of a vise squeezing together, the nation’s clinical laboratories and pathology groups now find themselves caught in the jaws of the federal government’s complex program to encourage providers to adopt and use electronic health record (EHR) systems.

One jaw is the failure of many EHR systems to certify to Meaningful Use Stage Two requirements, thus exposing physicians using those EHRs to substantial Medicare penalties as early as this year.

The other jaw of this proverbial vise is the need—for the second time—for many medical laboratories to spend substantial amounts of money to create a new LIS-to-EHR interface to those client physicians who are replacing their first EHR system, because it is not certified to Meaningful Use Stage 2 and they want to avoid Medicare penalties for use of a non-certified EHR. (more…)

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