BENEFITS OF IN-OFFICE TESTING

 Timely Test Results Cut Costs, Experts Advise, but There are Some Challenges.

When Dr. George Cousin completed his family practice residency in 1984 and started his practice in New Iberia, La., he didnít have a physician office laboratory. All his patient clinical samples went either to a local hospital lab or to a certified reference laboratory.

In fact, he says, he didnít even establish a lab in his office until around 1997. Today, Cousin says, he and his practice partner wouldnít be without an on-site laboratory.

ìIt is so much better a way to practice medicine,î Cousin says in an exclusive interview with Physiciansofficeresource.com.

Cousin says setting up the lab cost the practice around $70,000 to $80,000 to set up, and he considers it worth every dime. The advantages are just so obvious, he says.

No more sending patient samples out or worse sending patients themselves to a hospital lab, where as often as not they incur another copayment. No more waiting up to a week to get test results, sometimes dictating that patients have to come to the office again so the doctor can explain the results and adjust therapy.

ìDoing the tests in the office means that results of CBCs or stat chemistries are readily available and that helps me to make treatment decisions on the spot,î Cousin says.

Today, Cousin and his partner can order a whole range of CLIA-waived lab tests, including CPKs, PSAs, TSH and CBCs, done right on the premises. Patients wait a few minutes for the test results and go home knowing whatís going on and what their doctor wants them to do.

Another advantage: ìItís easier for me to add tests to be done on a (patient) specimen when the tests are done in the office,î he says. ìItís a huge benefit to the patient,î Cousin adds.

Patients appreciate being able to come to a place where they know the people performing the tests and then going about their business, he says.

CLIA-approved and CLIA waived equipment has become more available and affordable in the past decade, experts say. During this period, major medical equipment manufacturers have pushed miniaturization of equipment and the increasing use of microprocessors.

These largely automated devices require smaller samples of blood or other patient fluids, and their increasingly sophisticated microprocessors have taken much of the ìguess workî out of obtaining clinical laboratory information in physician office laboratories.

Further, advances in ease of operation ñ requiring less specialized training for office staff and increased automation ñ have made the devices more reliable in terms of the information obtained for use in clinical decision making.

Physician office laboratories (POLs) first came on the scene in the late 1970s, according to Andy Gill, president of Health Care Technologies, Inc., a Baton Rouge, La. firm. These labs were little regulated at first, but federal regulators began to change that in the late 1980s, with the creation of Clinical Laboratory Improvement Act, or CLIA. Four years later, in 1992, Gill says, the government published the first CLIA regulations. POLs also come under the purview of the Occupational Health and Safety Act (OSHA), Gill says.

While the CLIA and OSHA regulations can seem daunting when physicians are setting up their office labs initially, for the past seven years or so, he says, the regulatory environment has been fairly stable.

Setting up a physician office laboratory isnít overly daunting but it does require some ìdue diligenceî in deciding what kinds of testing will be done on site, Gill says. Whatís key, he says, is planning properly before investing in the equipment, reagents and other tools needed.

Doctors considering a POL need to analyze the patterns of their test use to determine what will be cost effective in terms of office testing, Gill says.

ìDesign it (a lab) with the economies in mind,î Gill says. ìIíve seen physician office labs go under because the doctors bought equipment that they didnít need or couldnít handle,î he warns. ìMatch the instrumentation to the doctors,î he adds.

Gillís three keys to success in setting up a physician office lab:

• The regulatory part: Keeping accurate and timely records is a cost of doing business.
• The economic side: Making sure you order the right equipment, reagents and controls. And know in advance what the doctors are already sending to outside labs.
• The analytical side: Thatís the equipment to generate the results. ìYou donít want to be penny wise and pound foolish,î Gill warns. ìDoctors need to match the right-size analyzers with a practiceís needs.î
• Finally, advises Gill, ìExpect a shakedown period.î

One of the hassles that doctors can expect in setting up a POL is getting reimbursement from third-party payors, Gill says. 

ìThatís especially difficult given the different payor mixes,î that is typical of private office practices, Gill say. ìBe prepared to justify to payors the costs of POL services.î 

Expect payors to reject some claims he says. Thatís another aspect of Gillís ëbe preparedí mantra. 

Accurate record keeping, including being able to point out the cost advantages to a payor of POL charges, is key, he says. A timely letter to a payor who rejects a charge can produce positive results, he says. 

ìDonít just take ënoí for an answer,î Gill says. 

Some physicians have elected to take the next step and move up to non-CLIA-waived clinical laboratory testing, according to Barry Craig, of Laboratory Consulting, LLC, a Birmingham, Alabama firm. 

ìA lot of physicians already had in-house labs in the CLIA-waived category,î Craig noted. ìNow, they are making the move to non-waived equipment, mainly out of concern for moving up to a higher level of service,î he added. 

Craig says he has seen a two-fold increase in the past two years of physicians around the country wanting to move their office laboratories up to the next level. 

The non-CLIA-waived equipment is getting more user-friendly all the time, Craig said, and requires far less end user sophistication and training than used to be the case even a few years ago. 

In addition to ease-of-use issues, the increased automation of the testing devices means that physician office staffs need far less supervision and training than used to be the case and they can operate the devices faster. This in turn means that the machines quickly begin to pay for themselves, he says. 

ìTake a device that measures complete blood counts as an example,î Craig says. ìIf a physicianís office orders five CBCs a day, thatís enough to break even on the deviceís costs.î ìJust five CBCs a day, thatís the break-even point,î Craig asserts. 

Not that most physician practices see POLs as a profit center, he added. Insurance companies, Medicare and Medicaid control reimbursements on these tests very carefully, Craig says, although most of the larger payors are fairly willing to reimburse for office testing as long as physicians can reassure them on quality standards, he says. 

In fact, Craig says, thereís far more to recommend POL testing than reimbursement, even if doctors do break even on charges for the tests. 

ìThe techniques for using the testing devices have become more computer and Web based,î Craig says. 

Reporting testing results to third-party payors, other physicians and even the patients themselves has become much less onerous, he adds. Plus, Craig says, many physician practices are moving to paper-free offices. 

ìMost physician practices are moving to paperless or computerized record keeping,î Craig says. 

ìMost of the (testing) devices have memories that can store findings, and computer interfaces that allow physicians to download test results directly into patientsí computerized office files,î he says. 

The physicianís records, complete with POL results, can be shared with other doctors and with hospitals if a patients is hospitalized. 

ìIn the businesses I contact, seven out of 10 are moving toward paperless offices,î Craig asserts. 

Even more, physicians can review this information with patients and make immediate adjustments to the treatment regime, if warranted. 

ìIf a patient is on (the blood thinner) Coumadin, office staff in the POL can draw blood and determine Coumadin levels, which can be adjusted immediately if needed,î Craig says. 

The information can also be used to counsel patients about the effectiveness of treatment and suggest lifestyle or other changes that might improve outcomes. For example, Craig says, diabetic patients can get a hemoglobin A1c reading during an office visit. Whatís more, the physician can show the patient a printout of hemoglobin A1c results history, and correlate ups 

The next 10 years will show increasing sophistication in POL equipment, even among CLIA-waived gear, Gill predicts. ìIím talking about the ëlab on a chipí sort of thing,î he predicts. 

Physician practices will continue in the future to face challenges, all the experts agree. Costs and reimbursement will continue to challenge physicians who operate POLs, Dr. Cousin says, adding, ìThe big health maintenance organizations are driving down (reimbursements).î 

Donít expect to set up a physician office lab to make money, Dr. Cousin advises. But heís confident that doctors who operate such labs in their offices will continue to at least break even. The advantages to both doctors and patients are worth it.