To meet the challenges of today’s healthcare system, lab executives and administrators are rethinking their business strategies. As the era of fee-for-service from government and private payers is replaced by value-based reimbursement, how will clinical laboratories and pathology groups be paid? As integrated care organizations, such as ACOs and medical homes, enter the healthcare market, which lab testing services will deliver the most value to these new users? And will payers issue coverage guidelines and set adequate prices for the flood of new molecular assays and gene tests coming to market? These complexities have already driven a handful of medical laboratories and pathology practices to bankruptcy, sale, or closure. Innovative lab business and service models, such as those at TPC, are emerging to address these concerns.
Billing and collection in the healthcare system is highly complex. Authorizations need to be received, benefits are often restricted, many services are subject to deductibles, and in-network versus out-of-network coverage must be monitored. Even after payment is received, there are new challenges. Employees must record these transactions within systems, tracking payments, denials, balance transfers, and adjustments.
Almost 60 percent of U.S. hospital executives said their institutions have had to change their business models if they’re going to survive financially. Conjointly, it is well established that both outsourcing lab services and creating partnerships help reduce costs. While most of TPC Members do outsource their clinical reference lab services, many have contended with how to secure true partnerships that assist them in further reducing spend in this area. By working together through TPC’s Clinical Reference Lab services, Members have realized an improved supplier relationship, and gained both financial success and improved efficiencies.
With the impact of Physician Preference Items (PPI) on total supply chain costs ranging anywhere from 40-60 percent, independent, community-based hospitals have begun working with physicians to dramatically change the way that these items are evaluated and purchased. Achieving system value without sacrificing quality of care requires a mixture of standardization and utilization with pricing strategies that optimize both financial and operational performance. One of the most exciting ways to achieve these goals is through standardization of medical device contracts.
TPC is a leading coalition that has built a distinct regional model based on collective participation and high commitment that has proven successful. TPC has demonstrated steady savings for over 10 years, while also increasing overall value for Members. The financial benefit is typically the leading story, but TPC is so much more.
The opportunity to talk with fellow Members, explore the TPC purpose and vision in depth, and evaluate new initiatives were the highlights of the recent Fall Classic Value Analysis Team (VAT) training event for TPC colleagues. By making time for discussion about strategy, Members came away energized and ready to tackle the 2018 work plan.