HEALTH NOTES

LABORATORY TESTS CAN BE

VERY PROFITABLE

PART II

My experience with managed health care, specifically with pre-certification of treatment and procedures, is that insurance companies essentially are performing a cost shifting. In other words, they are utilizing health care dollars that would have been spent on patient care to perform and pay for pre-certification departments which ultimately increase the insurance company’s overhead. Many insurance companies use independent companies and out source this work to decrease their costs, but if a company is using an in house pre-certification department, this can be an expensive proposition, and could in some instances be a wash for the company. In other words, the health care dollars that would have previously been spent on testing treatment and procedures for patients are now being spent on a pre-certification department.

Be that as it may, this multi-billion dollar laboratory industry has developed some ways to allow doctors to increase their profits, while making a sizable profit for individual laboratories. These labs will utilize techniques to entice doctors to send their laboratory work to their specific labs.

Critics of this laboratory deal business state that doctors will search for the most inexpensive lab to send their testing to in order to increase their profit margin on laboratory tests. Unfortunately, as I have said over the years relative to vitamin supplements, you get what you pay for. Unfortunately, some of these labs are small mills which churn out laboratory work at an extremely high rate, thereby increasing the potential for mistakes.

As with the woman I cited in this article from North Carolina, she got a positive test on her biopsy. However, after investigating further and having a second opinion on the same sample, it was found that her test was completely negative.

According to Lisa Lerner, a Boston area dermatopathologist who was cited in this article, “Patients should wonder if this dermatologist is doing this biopsy because I need it, or because he is going to make money from it.” Unfortunately, once the profit incentive sneaks into the mind of a physician, patients must question in their own minds at least, whether a test is being performed because it’s necessary or because it adds to the bottom line of that particular practice. Next week I will discuss what is being done to combat this problem.