The Outlook For Hospital Lab Outreach Testing

By Jeff Myers
Published in: Laboratory Economics
October 24, 2017

What happens to hospital lab outreach programs if the proposed Medicare CLFS rate cuts are finalized? For answers, Laboratory Economics spoke with Jeff Myers, Vice President for Consulting with Accumen Inc. (San Diego), which recently published results from its Chi Solutions 16th Annual National Hospital Laboratory Outreach Survey. The following is an excerpt from the Laboratory Economics article…

How damaging will the proposed Medicare rate cuts be to hospital outreach labs?

The typical hospital outreach lab gets 25% to 30% of its revenue from the Medicare CLFS, so the proposed 10% reduction in 2018 Medicare rates would translate to a 2.5% to 3% revenue loss. However, most hospital outreach labs are insulated from the cuts rippling through to their private-payer rates because these rates are negotiated as part of their hospital’s overall outpatient contracts and are not tied to the CLFS. Hospital outreach lab rates are often two to three times more than what the commercial labs are paid.

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