BIO-REFERENCE LABS MOVES TO START PATIENT-DOCTOR MESSAGING
ONE OF THE NATION’S MORE AGGRESSIVE efforts to refocus the clinical laboratory organization can be found at Bio-Reference Laboratories, Inc., located in Elmwood Park, New Jersey.
Bio-Reference wants to use its basic lab testing relationship with physicians as the foundation for a business relationship that involves a host of other value-added services.
Last month it announced its latest strategic partnership. Bio-Reference’s connectivity portal, CareEvolve.com, signed an agreement with Healinx Corporation. CareEvolve.com can now incorporate Healinx’s Web-based messaging system into its suite of services. Healinx’s sophisticated system allows physicians and patients to communicate using the Internet.
Bio-Reference CEO Mark Grodman, M.D. described his business strategy. “Our vision is to provide a connectivity solution which allows the physician to operate the most reliable, convenient, and cost-efficient Web- enabled medical practice possible,” he commented.
“Working together with Healinx, CareEvolve.com will enhance physician-patient and physician-payer electronic communications on a secured basis,” Dr. Grodman explained, “including communicating laboratory results, messaging, prescriptions and refills, scheduling, payer verification and eligibility, as well as offering other Internist-based services to the physician members.”
Bio-Reference also released its financial performance for its first quarter, ending January 31, 2000. The company posted record quarterly revenues of $15.0 million, a 19% jump over same quarter last year. Operating income also increased.
For the quarter, Bio-Reference had a net loss of $95,565, compared to a net loss same quarter the previous year of $107,741. Patient volume increased over the same quarter last year by 12%, from 279,744 to 312,391.
Bio-Reference expects its investments in diversified, non-laboratory businesses will begin to contribute revenues to the company in the next 24 months. Its operating divisions now include CareEvolve.com, PSIMedica, a medical management unit, and a food company, Right Body Foods.
CARESIDE RAISES MONEY, BUILDS MANUFACTURING RESOURCES
PROGRESS IS SWIFT at POC instrument manufacturer Careside, Inc., based in Culver City, California.
The company closed a private placement of common stock for $8.5 million earlier this month. The funds will be used to expand Careside’s marketing force and for working capital.
Careside manufactures a proprietary point-of-care system for doing routine chemistry and hematology testing. It has obtained the needed FDA clearances and is now introducing its products in the laboratory marketplace.
The company’s CARESIDE Analyzer™ comprehensive blood chemistry instrument was selected as a finalist in the Medical Design Excellence Awards (MDEAO 2000 competition). Only Careside and one other company from the in vitro diagnostics industry made the cut. Winners will be announced at the Medical Design and Manufacturing East 2000 show, scheduled for June 6-8 in New York City.
Careside also announced that it had passed California’s Initial Manufacturing Quality audit. This audit is conducted by the Food and Drug Branch of California’s Department of Health Services. It is a prerequisite for ongoing product distribution.
THE DARK REPORT predicts that CARESIDE’s point-of-care solutions for routine chemistry and hematology testing will stimulate intense market competition in this segment between it and other diagnostics companies. CARESIDE executives will be at this year’s Executive War College in New Orleans on May 16-17 to present their products and business strategies.
DOCTORS AND AMA SUE MANAGED CARE FIRMS OVER “UNDERPAYMENTS”
HERE’S ANOTHER IMPORTANT development in the running battle over adequate reimbursement between healthcare providers and payers.
A lawsuit seeking class-action status was filed on March 15 against United Healthcare Corp. and Metropolitan Life Insurance Company in a New York City state court. Plaintiffs are the American Medical Association (AMA), the Medical Society of the State of New York, a New York physician, and his patient.
Plaintiffs claim that the insurers used invalid data to determine reimbursement rates and reduce payments to thousands of New York doctors. Insurers used data provided by the Health Insurance Association of America (HIAA) to determine “usual” charges for medical services. The suit asserts that HIAA “doesn’t stand behind this data.” According to plaintiffs, the lower reimbursement levels established by insurers have forced patients to pay higher doctor bills to make up the difference.
This is the second suit by the AMA against an insurance company. In February, the AMA filed suit in Georgia against Aetna, Inc. for failing to pay physicians promptly.
This class action lawsuit represents a new legal strategy by physicians and providers. They want to attack the actuarial soundness and integrity of the data used by insurers to establish “reasonable and customary charges.” Many healthcare providers believe that insurers cannot support and justify how they developed the current level of arbitrarily low reimbursements.
MORE HEALTH INSURERS MAY BE RIPE TARGETS FOR ACQUISITION
LOW SHARE PRICES FOR SEVERAL LARGE HMOs may make them attractive targets for acquisition by other insurance companies.
Wall Street analysts speculated that the acquisition offer for Aetna, Inc. by WellPoint Health Systems, Inc. and ING Group NV is a possible precursor to other acquisition offers.
Most likely prospects are Foundation Health Systems, Inc. and Oxford Health Plans, Inc. Since May, Foundation’s share prices are down 38% and Oxford’s are down 16%.
One reason that investors are shying away from these companies is a concern that federal legislation and patient-rights litigation may result in crimping the profitability of all managed care companies. Depressed share prices make it attractive for interested buyers to acquire these insurers at an attractive price.