Clinical Labs Cut Costs but Face Future Challenges by Ken_Powell
Taking a play from many healthcare payer playbooks, hospital labs have instituted cost cutting and proactive screening programs that yield substantial bottom line benefits. Copying third party payer pre-certification programs for high-cost tests, a Florida healthcare system initiated an esoteric test approval program for any request in excess of $1,000. The result of this program was an annual savings of $220,000. The lab then went on to introduce and monitor test formularies designed to reduce the volume of send out tests to commercial labs. This saved $74,000 and utilizing “best practices” for blood products added another $412,000 in savings.
But less is not always more. A 248 bed New York Hospital implemented rapid molecular diagnostic testing for hospital acquired infections (HAIs) that reduced the annual rate of C. difficile by 63%, which translated in a cost avoidance of $1.5 million dollars. A great return on a relatively small investment of $86,000 dollars. Mather Memorial Hospital, also in New York followed the same path for a different HAI, Methicillin-resistant Staph aureus (MRSA). Mather’s lab spent $440,000 in new rapid molecular testing to yield a $2 million dollar overall and $1.5 million dollar net savings.
But the need to decrease costs in the face of rising volumes, payer reimbursement reductions and a serious shortage of qualified medical technologists will continue for the foreseeable future. Considering that over 70% of all clinical decisions are made based on a laboratory test result, the value of laboratory services in the healthcare delivery continuum is essential to overall cost-effective medicine.
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