Government Health Contracting Has a Seamy Side

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WHAT MIGHT HAPPEN TO YOUR LABORATORY if either or both Medicare and your state’s Medicaid program initiated some type of competitive bidding for laboratory testing services?

I’ll bet there would be a level of financial pain, not to mention the consequences to physicians and patients as long-standing laboratory relationships were changed in favor of the laboratory which won such a competitive bidding project. Certainly the concept of competitive bidding runs contrary to the stated goals of Medicare and Medicaid. How often have we heard government healthcare regulators and elected officials tell us that government- funded care must provide equal access to all patients and all providers?

If Medicare and state Medicaid programs continue moving toward some type of bidding format involving laboratory services, it will favor certain types of laboratories over others. Clearly smaller labs and specialty testing labs will find themselves at a disadvantage. That is why I think the events in Florida deserve much more attention by the laboratory industry.

If Florida Medicaid perseveres and awards a single laboratory with an exclusive, three-year contract to provide all non-hospital lab testing, it is a financial hammer to 97 other independent laboratory companies in Florida currently serving Medicare beneficiaries. Shouldn’t this cause concern among lab firms in other parts the United States? And—by the way—hospital laboratory outreach programs are to be exempted from this state-wide, sole-source contract! That’s a double standard which creates two classes of citizens and treats them differently.

Are you interested in learning more about this threat? If so, I recommend you carefully read our expose of the unprofessional, if not outright incompetent, efforts by the Florida Medicaid agency to draft a contract awards process for its statewide laboratory services contract. (Pages 13-17 in this issue.)

As usual, it’s information you’ll find nowhere else but in THE DARK REPORT. Our sources are many and deep and we reveal how flawed this contracting process has been from the start. Equally disturbing is the trail of evidence that hints at how one politically-connected laboratory company in Florida is influencing contract specifications to favor it. As you read this story, think about the consequences if your state’s Medicaid agency decided to follow that of Florida’s and initiate restrictive lab contracting policies.

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