Will new health insurance laws increase the temperature of lab technicians?

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Will new health insurance laws increase the temperature of lab technicians?

The government’s demand for large amounts of data from clinical laboratories is designed to help curb the cost of medical insurance reimbursement diagnostic tests. But it threatens to overwhelm the industry. When big data exchange big data, the lab should know what.

The big change, in the $54 billion medical diagnostic laboratory industry, is that the state is rapidly emerging as part of the overall trend in health care reform. This change will bring very difficult technical and business process transformation requirements to the industry. This is what happened.

Historically, medical insurance has provided some of the highest reimbursement rates for clinical diagnostic laboratory services in the industry. The medical insurance laboratory test rate, which was developed in 1984, was based on the cost of testing in each medical insurance operator’s jurisdiction at the time. Since then, these payments have been modified only through a single percentage of the legislation. So, according to a report from the U.S. department of health and public services, medicare is now 18 to 30 percent more expensive than private payers.

In a bill signed by President barack Obama on April 1, 2014, congress proposed a new approach to pay lab tests in many other regulatory changes. The “health care insurance act” (” PAMA “) has introduced medicare and medicaid services (CMS) to set up a federal cost table for clinical diagnostic laboratory compensation. These payments will now be based on the weighted median of the private payers’ rates paid to the diagnostic laboratory in the previous year. As proposed, CMS will update the price of the newly defined advanced test category annually from 2017 and update the prices of all other clinical diagnostic laboratory tests every three years.

PAMA aims to introduce a market-based payment system that will bring and maintain the federal government’s personal payment rates for diagnostic costs consistent with those paid by the private sector. This will have a big impact on a huge industry. Diagnostic laboratory services for the current in the highly fragmented and competitive industry in the operation of the thousands of laboratory (independent companies, as well as in the doctor’s office and the hospital system run laboratory) generated $54 billion in annual income. According to the American Association of Clinical Chemistry, revised laboratory payments will lead to “dramatic changes in laboratory medicine over the decades”.

These laboratories, which have slowed in recent years, may see a drop in medicare payments. In fact, CMS invested more than $5 billion in the first decade. This will force laboratories to look for ways to reduce their costs or identify additional sources of income.

Is more urgent, in order to let the CMS set these new payment schedule, clinical laboratory must be in July 1, 2015 to December 31, from private payers received hundreds of additional data, for hundreds of single diagnostic test. Although delivery date has been delayed until the final rules, but the lab will have to put these data submitted to CMS, or face every day as high as $10000 in fines, because they do not have to report their rates, or falsely report their data.

A very imperfect gift.

These federal reports require a direct challenge to the laboratory – unfortunately, development alone cannot be remedied. The laboratory has encountered some obstacles in providing these data to regulators. Many clinical laboratories are unable to access their payment data in a centralized data warehouse, enabling them to provide the price reports that the government now requires. Some laboratory has already obtained development through acquisition, therefore may be more lab or geographic area has established the different types of financial system, so that the CMS report become a nightmare of the technology and operation.

Although the system may need to use new technology to solve – given a reasonable time, investment and plan – for each can be used to calculate the average diagnostic tests provide discrete quantity and payment information and greater obstacles. Many third-party payers pay in diagnostic tests and perform multiple tests on a single patient visit rather than a separate test. This hides the amount of each test payment and the CMS needs (now wants) to test the test volume for each test average. Figuring out how to deal with payment and batch data is very complex, and there is little leverage in the diagnostic lab to change third-party payment methods.

Moreover, the government has not finalized the data report requirements. Although the CMS said private share the cost rate payer shall include the amount, but as a part of the patients with annual deductibles test should report to the CMS, as a total cost of diagnostic services is not clear. In fact, CMS has not yet specified the form and manner of the laboratory reports on this information. 

Delays in implementing the rules are not unusual. However, the laboratory cannot wait to provide the necessary payment data to the federal government. Currently, clinical diagnostic laboratories that do not have centralized data warehouses may not have time to set up before the data collection deadline. Even those laboratories that have centralized data warehouses may be collecting payment data from insurance providers, but this does not help to collect item-by-item reimbursement information for CMS requirements. The lab must immediately start using technology and processes to solve these problems.

To get the truth

Introduced by the government for a short period of time for all of the payer to provide the quantity and price information, and each test, the lab will have to analyze their currently has reasonable data to estimate the year before. They will have to validate the information before they are created, and then submit it to CMS. In the laws of the appropriate approvals and clinical diagnosis laboratory of CMS and compliance group, clinical diagnosis laboratory at the first reporting period can take many kinds of ways to CMS amount of payment and pay the required data.

The laboratory that contains the personal diagnostic test fee table in the contract of the third-party payer can use the price in these expense tables as an agent for the actual payment data. These agreed prices can be a reasonable start if the laboratory is convinced that the third party fee schedule is complete, excluding quantity or other types of discounts.

In addition, a declaration involving only one test can enable the laboratory to determine the exact individual reimbursement for a particular payer. Although usually, multiple diagnostic test was conducted in the same patient encounter, but only by a test can isolate these cases, lab can better understand the amount of the payment. However, with this price information, the lab must calculate the overall product by looking at other claims that contain the same test, even if the test is part of a patient who has been tested multiple times.

The laboratory must also determine how or if the patient’s deductible data is captured in a payment. If CMS does not allow the exclusion of claims due to patient sharing costs, the laboratory may need to allocate patient payments to appropriate testing. The amount of the patient’s assessed contributions will ensure that the amount of commercial payments submitted to CMS will not be artificially reduced.

Finally, the lab should develop a process to verify the payment and bulk data submitted to CMS. Quality control and data validation are critical because they not only punish the data, but also deal with inaccurate or misleading information. Due to the clinical diagnosis laboratory may have to get these information indirectly (paid use fee schedule, check has been completed or the test subset or apportion cost-sharing amount), so they need to test the result data over the same period of other information about the diagnosis of payment and quantity. Business reports that contain revenue and test volumes related to commercial payers may be a good source of validation.

The hard road ahead.

In order to provide this new information to CMS, the clinical diagnostic laboratory can begin to answer the following nine questions:

1. Are there any technical barriers and problems – such as different billing and payment systems, which will be difficult to collect or report – and can be resolved in time?

2. Does the laboratory have a central data warehouse or warehouse – for all laboratories – from which all claims payment information can be accessed?

3. Does the financial system receive payment at the current program term (” CPT “) code or meeting level?

4. Can the patient’s co-payment or co-insurance be accurately applied to the appropriate meeting, and can the cost-sharing payment be applied to the correct CPT?

5. Is it possible for the laboratory to determine the credit, adjustment and/or resettlement of possible effects or cancellations?

6. Is there a plan to combine payment information from different business departments or systems into single data submission?

7. Does the laboratory have an up-to-date customer master file to determine all commercial payers for diagnostic laboratory testing? If not, what steps will be required to create one? If there is a master file, does it include historical data as early as July 1, 2015, and does it allow laboratories to distinguish between commercial payers and doctors?

8: does the client’s master file allow the laboratory to separate payment from payment service (the monthly fee paid by each member)?

9: is the laboratory capable of isolating data collection time for each private payer?

The clinical diagnostic laboratory must be a set of questions to ask yourself if it is possible to control measures to verify will report to the CMS data:

1. Is there a business report or other source of data for payment and data in the same period, and the laboratory can coordinate and verify payment and quantity is trying to estimate?

2. Is there any document confirming that the charging schedule is an accurate representation of the payment by the private payer?

3. The current business process ensures that the charging schedule can be consistent with the individual customer?

Iv. What technical progress or business processes can be effectively run in the laboratory in a short period (or even longer) in such a changing environment?

Obviously, the lab should try to integrate the discrete billing system into a data warehouse. It’s not easy. In the long run, however, the process of reporting data under the new CMS rules will be less onerous.

The lab also needs to allocate a collision based payment to a separate test for real-time comparison of the payment and expense table to determine the cost and payment of a single test. In addition, the laboratory will have to be isolated from individual test payment in patients with payment and payment together.

Diagnostic laboratory test industry’s challenge is significant. This will create a level of confusion, but planning can mitigate some of the negative impacts and even lay a solid foundation for future growth.

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