The laboratory has always faced reimbursement cuts, but the Physician Fee Schedule (PFS) and Clinical Laboratory Fee Schedule (CLFS) released earlier this year have left some organizations stunned. A few devastating numbers that caught our eye was the 52% decrease to the technical component for 88305, as well as upwards of 70% decreases to various IHC stain processes. Laboratories are now focused on keeping doors open amid the reimbursement cuts and trying to mitigate the impact of these changes.
Some reimbursement cuts were nearly twice the amount organizations had anticipated, and laboratory leaders have been struggling to keep lab processes that were once main profit-drivers. To make things more challenging, there are items that are reduced by a few cents or dollars and their severity may not be as apparent and their significance may go unnoticed. Without an easy way to measure and understand the impact of these changes, minor reimbursement cuts are just as likely to cause organizations substantial financial problems.
Organizations can utilize analytics solutions to quantify the impact of these reimbursement cuts, at both an aggregated and detailed level. The first view to the left is an example of how Viewics can quantify the exact payment differences between last year’s reimbursement values with the new payment changes.
This analysis forecasts the potential reimbursement impact across these key stain processes for 2014. The view predicts how much your organization will be reimbursed with the new fee schedule based upon previous stain slide counts, allowing leaders to better strategize how to cope with the drastic cuts.
The second view to the left is a comparative dashboard of the ten tests that have the largest potential decrease in annual reimbursement, and the ten tests that have the largest increase in annual reimbursement for 2014 based upon 2013 volumes. Even though larger reimbursement cuts like with IHC processes may be easy to focus on, lab leaders now understand which tests may offer more reimbursement value, and develop more marketing and sales efforts towards these processes to create new profit-drivers.
These views aggregate historical data and accurately predicts the impact changes will have in the future. These analyses shows the reimbursement impact for this year’s new payment schedules, and leaders are able to gauge how much they will actually be losing based upon their very own representative data. Leaders never have to rely on manual methods of gathering data, and can spend their time strategically shifting their businesses in order thrive once again.
Reimbursement cuts do not have to be met with such bleak outlooks. Another key to surviving this hostile reimbursement environment is to utilize laboratory information to reveal how your organization can strategically deal with costs to negate the reimbursement losses. Out-of-the-box reports, like the cost per test analysis shown to the left, allows leaders to compare the specific costs associated with each lab process subject to reimbursement changes.
Insight into what tests may now be unprofitable and those that may be more profitable, enables healthcare leaders to make better business decisions about their test directory, substitute offerings, and cost structure. Organizations can understand the exact impact of these reimbursement changes to proactively and strategically restructure their businesses. In addition, having a clear picture of the true costs of particular tests or services can better illustrate how the organization’s potential bottom line is impacted. Viewics offers timely, accurate and detailed information, so that organizations can determine which tests and services should be offered and what the impact of each decision would be.