Physicians and Labs Wary of United’s Lab Test Program

UHC says goal is improved quality, but physicians, labs see program as cost control

CEO SUMMARY: Providers seem to have a natural distrust of health insurers, particularly when payers introduce new programs with the stated purpose of improving quality and ensuring that physicians deliver evidence-based medicine. Doctors serving members of UHC’s HMO plans in Florida are told by UHC that it wants to improve the quality of lab test ordering and help them practice within guidelines. However, physicians and labs in Florida believe the BeaconLBS arrangement is about cost control.

NOW THAT THE LABORATORY BENEFIT MANAGEMENT PROGRAM created by UnitedHealthcare has launched in Florida, it is time for clinical lab managers and pathologists everywhere to pay attention to this development.

That’s because UnitedHealthcare (UHC), as the nation’s largest health insurance company when measured by enrollment (with 36.5 million beneficiaries in 2012), is attempting to create a new approach to contain the cost of laboratory testing. If it succeeds in Florida, the company has already announced that it will implement this program in other states.

Thus, UHC’s laboratory benefits program has the potential to soon show up in your neighborhood. And, as currently designed and implemented, one consequence of the UHC laboratory benefit program is that it will be used as a tool to exclude many local labs as providers of lab testing services to UHC members.

That has proven true in Florida. In one of the nation’s most populous states, with 212 hospitals (only Texas and California, with 376 and 348 hospitals, have more), the BeaconLBS laboratory of choice panel includes just 13 lab organizations on the UnitedHealthcare website. Of these 13 labs, five are owned and operated by Laboratory Corporation of America. Of the others, two are toxicology labs, four are pathology labs, and two are clinical labs (not including LabCorp).

Questions about Goals

Legitimate questions have been raised about the goals of UHC’s laboratory benefit management program, not to mention itsdesign. Within the physician and clinical lab communities, questions to UHC about the actual proportion of laboratory testing that is considered to be inappropriate or outside of clinical guidelines have gone unanswered.

Physicians and labs in Florida want to know why a health insurer like UHC believes the problem of inappropriate lab test orders is so great as to require a new and complex bureaucracy to monitor physicians at the time they order a test.

Equally significant, given the 81 lab tests on the decision support test list, does UHC have statistics about inappropriate utilization that justify including each test on this list? Physicians point out that tests with well-established guidelines and which are included in HEDIS reporting are on the decision support test list. They ask why they should be required to go through the time and expense of pre-notification each time they must order such common and high- volume assays as Pap tests, HCV tests, and HIV tests, to name a few.

Evidence of Benefits

What benefit does UHC believe it will produce for patients by requiring each physician to obtain pre-notification for each of these tests each time they are ordered? To date, it is believed that UHC has not responded to these legitimate concerns with a public statement and evidence to support the need for this bureaucratic procedure and the inclusion of those 81 tests on its decision support list.

It is not a surprise to anyone who has looked into the details of this scheme that some physicians are speaking out vociferously against the design of the laboratory benefit management program. There is plenty of evidence to support their complaints about the substantial amount of time required to go into the BeaconLBS system, enter the necessary information and receive a pre-notification or pre-authorization code.

Could Docs File Lawsuits?

Another question that may be soon answered is whether physicians and their state associations will consider UHC and BeaconLBS to have overreached to such an extent that they feel it necessary to file lawsuits to address this matter. In such an event, the plaintiff would likely ask the court for an immediate injunction to cease implementation of the laboratory benefit management program until both parties can present evidence to the court in a formal hearing.

That might make for an interesting time in the courtroom. To date, UnitedHealthcare has not offered much data to support its claims that pre-notification of clinical lab tests is needed to control inappropriate utilization and improve patient outcomes.

Moreover, there are some healthcare experts who believe that, were some type of legal action to commence over this matter, UnitedHealthcare would have some thorny conflict of interest issues to address. That’s because BeaconLBS—the gatekeeper that determines which labs participate—is owned by a laboratory that competes with all the laboratories in Florida that are candidates to be on the laboratory benefit management program’s “laboratories of choice” list.

Moreover, Laboratory Corporation of America, the owner of BeaconLBS, has an exclusive national lab testing contract with UnitedHealthcare. It doesn’t take much imagination to picture UHC having to respond to assertions that the two companies have colluded to create a scheme that denies competing labs access to UHC patients—access that some labs in Florida already have. (These labs hold contracts with UHC, but have not registered with BeaconLBS and do not appear on the list of laboratories of choice.)

Asking for Comments

Of course, these are all speculations as to how physicians and their state associations may respond to BeaconLBS and the UHC laboratory benefits management program. What is true is that a number of physicians have spoken publicly about their questions and concerns and Florida physician associations are asking their members for comments about the program.

That sets the stage for the next round in what is shaping up to be a battle of the wills. Might UHC risk further ill-will by continuing to push physicians with the BeaconLBS program? Or, might it decide to back off? Stay tuned, because the next chapter will soon play out.


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