“November 17, 1997 Intelligence: Late Breaking Lab News”

Neuromedical Systems’ PapNet® procedure is included in the new CPT codes covering automated cytology. The CPT codes take effect on January 1, 1998. Expect to see a flurry of announcements that selected managed care plans will reimburse for automated cytology procedures.

On November 5, it was announced that Paul Sohmer, M.D., would be the new President and Chief Executive Officer at Neuromedical Systems. Dr. Sohmer was formerly President of Genetrix, Inc. prior to its acquisition by Genzyme Corporation. He was also a Corporate Vice President at Nichols Institute and was President and CEO of the Pathology Institute in Berkeley, California.

Columbia/HCA Healthcare is reported to be weighing a proposal to spin off as many as one-third of its 340 hospitals. According to the Wall Street Journal, the spin off could take the form of a publicly traded company.


On November 4, Beckman Instruments, Inc. formally completed its acquisition of Coulter Corporation. The combined firm will now be known as Beckman Coulter. As reported earlier in THE DARK REPORT, this merger creates a powerhouse company in chemistry and hematology. Expect to see other mergers as the diagnostics industry undergoes its own consolidation wave.

For-profit hospitals are losing favor with the public. According to a recent Kaiser Foundation study, 47% of Americans polled in October said “the conversion of non-profit hospitals and insurance companies to for-profit institutions was a ‘bad thing.’ Just 15% said the trend was good.”

Consider this study as part of the ongoing political lobbying between the non- profit and for-profit segments of the hospital industry. With Columbia/HCA under siege, nonprofits would like to see legislative constraints placed on the ability of for-profit hospitals to buy and convert nonprofit hospitals.

U.S. Labor Department Bureau of Labor Statistics published data showing that the monthly producer price index (PPI) for acute care hospitals increased only 0.1% in September. For the previous 12 months, the PPI increased 1.1%. Experts predict that this index will begin increasing at a faster rate during 1998 and 1999.


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