Share on facebook
Share on twitter
Share on linkedin
Share on print
Share on email


ALL LABORATORIANS SHOULD send a special note of thanks to Aetna Chairman and CEO John W. Rowe, M.D. for his recommendation that the health industry support the concept of genetic testing.

He made these recommendations as part of speech delivered at the Inaugural Symposium on Genetic Privacy and Discrimination, held at the University of Rochester in Rochester, New York on June 15, 2002. Dr. Rowe’s comments made national headlines.

“Health plans can play an important role in promoting access to clinically useful genetic testing and the proper interpretation of test results,” declared Dr. Rowe. “I believe there is a pressing need for the health insurance industry to establish guidelines for covering genetic testing in a way that promotes disease prevention and disease management, while at the same time respecting members’ privacy.

“We have a responsibility to our members to keep pace with medical innovation,” he added, “while preserving privacy and confidentiality. We believe there is also a good business case for health quality. A small investment in testing today can prevent or mitigate human suffering, while saving on health care costs in the future.”

As the nation’s largest health insurance company, Aetna’s endorsement of a wider role for genetic testing will affect policymakers at all levels of government and business. Dr. Rowe called for state and federal lawmakers to adopt uniform laws that would ease the introduction and use of genetic-based medical procedures.

Aetna’s endorsement of the economic benefits of clinically-proven genetic lab tests should help both diagnostic manufacturers and the clinical laboratory industry obtain adequate reimbursement for these types of lab tests as they are approved for use in clinical settings.


IN ITS ONGOING BATTLES WITH CONGRESS to obtain adequate year-to-year funding for Part B laboratory testing services, the laboratory industry may have picked up an unexpected ally.

Earlier this month, the stock prices of several anatomic pathology-based companies began plummeting without notice. In the next several trading days, shares of AmeriPath, Inc. were down 30%, shares of DIANON Systems, Inc. fell 40% and IMPATH, Inc.’s stock price declined by 20%.

It turns out that certain hedge traders had been studying the latest draft proposals contained in the 2003 fiscal year funding legislation now winding its way through Congress. They noticed that the current draft legislation would reduce reimbursement for certain pathology technical services, as well as the scheduled reduction in the physician professional conversion factor.

In particular, DIANON announced that, if the current budget proposals remain unchanged, lower Medicare reimbursement would reduce its earnings by 10% during 2003. “When you do the math, the impact comes out to be a bit worse than anyone expected,”? noted Angela Samfilippo, an analyst at U.S. Bancorp Piper Jaffray who tracks a number of clinical laboratory and anatomic pathology stocks.

Because lab stocks have been high flyers in recent years, the Wall Street investment community now takes a keen interest in any market variable which could affect the share prices of laboratory companies. Thus, each draft proposal for Medicare funding is now studied by investors seeking to determine its positive or negative impact on clinical laboratories. This is a change from past years, when such Congressional budget negotiations attracted little attention outside of the lab companies and diagnostic manufacturers who would be affected by Medicare funding levels.

The interesting speculation is whether certain professional investors, given their stakes in laboratory companies, might soon become a positive lobbying factor during budget negotiations. As such, these investors would be unexpected allies in the battle to maintain adequate reimbursement for Medicare Part B lab testing services.


IT’S ANOTHER PREDICTION by THE DARK REPORT coming to pass. The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) is revamping its publicly-available summaries of hospital accreditation survey results.

JCAHO announced this change in June. It is streamlining the performance reports it publishes for consumers following the surveys it conducts in hospitals and other healthcare organizations. The goal is to better relate the content of the summaries to consumers’ interest in quality and safety.

In taking this step, JCAHO is responding to deep changes in consumer and employer attitudes toward hospitals and other healthcare providers. How profound is this shift? Read this comment by Charles Mowll, JCAHO Vice President of Business Development, Government, and External Relations: “The current reports no longer reflect information that is meaningful to the field or the public.” (TDR’s italics.)

What is equally revealing is the demand to access the existing survey reports. According to JCAHO’s figures, between May 2001 and April 2002, the Web site section called “Quality Checks? was accessed 495,000 times and JCAHO received 117,500 requests for specific hospital performance reports.

Helping collaborate on the effort to revamp these survey result reports is the American Hospital Association, which is overcoming its long-standing resistance to public disclosure and rankings of hospital quality and safety measures. JCAHO expects the revised hospital-specific reports to be available by mid-2004. Long term care and home care reports will be introduced later.

JCAHO’s recognition that consumers and employers want and need clearer information about the quality of individual hospitals and their safety record fulfills a prediction made by THE DARK REPORT earlier this year that public measurement systems that rank laboratories, physicians, and hospitals in quality measures are coming rapidly to the marketplace. (See TDR, January 28, 2002.)

Hospital laboratories and pathology group practices should carefully track this powerful and rapidly-evolving trend. As noted on these pages in earlier issues, buyers of healthcare— employers—are becoming more vociferous in their efforts to hold providers accountable for the double-digit increases in healthcare costs that have returned in recent years.


Leave a Reply


You are reading premium content from The Dark Report, your primary resource for running an efficient and profitable laboratory.

Get Unlimited Access to The Dark Report absolutely FREE!

You have read 0 of 1 of your complimentary articles this month

Privacy Policy: We will never share your personal information.