[Histonet] In House Labs in WSJ

Morken, Timothy Timothy.Morken <@t> ucsfmedctr.org
Tue Apr 10 13:39:06 CDT 2012

Not surprising since our health care system is biased to pay for tests and treatments, not results. On top of this there are serious questions as to whether the PSA screening that leads to biopsies is useful in the long term. There is a recommendation out there to stop PSA screening for most men since it is largely  non-specific. That test is what leads to the biopsies. Less screening = fewer biopsies = less revenue.

Tim Morken

-----Original Message-----
From: histonet-bounces <@t> lists.utsouthwestern.edu [mailto:histonet-bounces <@t> lists.utsouthwestern.edu] On Behalf Of Daniel Schneider
Sent: Tuesday, April 10, 2012 11:22 AM
To: Histonet
Subject: [Histonet] In House Labs in WSJ

The Wall Street Journal served up a timely article for us.
You'll see both sides of the argument below. One side is right.


April 9, 2012, 7:22 p.m. ET
Prostate-Test Fees Challenged

Doctors in urology groups that profit from tests for prostate cancer order more of them than doctors who send samples to independent laboratories, according to a study Monday in the journal Health Affairs.

The study found that doctors' practices that do their own lab work bill the federal Medicare program for analyzing 72% more prostate tissue samples per biopsy while detecting fewer cases of cancer than counterparts who send specimens to outside labs.

Hiring pathologists boosts revenue for a practice and creates a potential incentive to increase the number of tests ordered, said Jean Mitchell, a Georgetown University economist and author of the study.

That fewer cancers were detected-21% versus 35% for those sent to external labs, according to the study-suggests "financial incentives"
may play a role in decisions to order the tests, Ms. Mitchell said.

Some urologists said the research doesn't necessarily indicate financial motives. Urologists in larger group practices that have in-house pathologists may be more aggressive in testing because they seek to catch cancer earlier, said Steven Schlossberg, a Yale urologist who heads a health-policy panel for the American Urological Association and wasn't involved in the research. Also, Dr. Schlossberg noted, the figures, which cover 36,261 biopsies from 2005 through 2007, are five years old.

The study was financed by the College of American Pathologists and the American Clinical Laboratory Association. It is the last salvo in a turf war between laboratory companies and physician groups that have opened their own labs to conduct tests.

Regulators and economists scrutinizing the growing costs of health care have targeted a range of related activities by doctors, known as self-referrals.

Although a set of 1990s-era laws, named for their proponent, Rep. Pete Stark (D., Calif.), ban doctors from referring patients to most companies in which they have a financial interest, urology groups can enter the pathology business because of an exemption for certain services performed within physicians' offices. The pathologists and other groups are lobbying Congress to end the exemption.

At issue in the study is a quirk of billing for lab procedures. Labs get paid based on the number of jars used to hold specimens from a prostate biopsy. Doctors can choose to put several specimens in one jar or put each in its own jar, potentially boosting lab fees, which averaged about $104 a jar in 2010, according to the study.

Urologists in practices with in-house pathologists sent 11.4 jars per biopsy for testing versus 5.9 jars per biopsy for other doctors in 2005.

Some doctors say that separating the samples can help them better map any cancer.

In addition, urologists in recent years have been taking more samples during a biopsy to better identify the location of any cancer, said John Hollingsworth, an assistant professor of urology at the University of Michigan. The standard number of samples taken doubled to 12 over the last decade, he said.

The Health Affairs study's conclusions are "largely around billing practices, not around clinical practices," said George Kwass, a pathologist based in Massachusetts and board member of the College of American Pathologists. Urologists who team up with pathologists appear to bill more, he said, leading to potential waste.

Urology groups are consolidating, and increasingly moving into the pathology business. One large practice based on New York's Long Island, Integrated Medical Professionals, opened its lab in 2010 to control costs and because doctors encountered errors in outside test results, said the group's chairman, Deepak Kapoor.

"We don't make a fortune on pathology," Dr. Kapoor said.

But lab businesses are seeing revenue vanish. Texas pathology group ProPath stopped getting prostate tissue from large urology groups more than four years ago, said executive director Krista Crews, when these clients began doing lab work in-house. The group still gets referrals from small, one and two-doctor practices, she said.

Large laboratory companies are worried about the trend, too. Quest Diagnostics Inc. DGX -2.52%said in its latest annual filings that if physicians, including urologists as well as gastroenterologists and skin and cancer doctors, continued to "internalize" testing services, it could reduce the company's sales.

Write to Christopher Weaver at christopher.weaver <@t> wsj.com

Copyright 2012 Dow Jones & Company, Inc. All Rights Reserved

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit _______________________________________________
Histonet mailing list
Histonet <@t> lists.utsouthwestern.edu

More information about the Histonet mailing list