Urologists- The Ugly Truth About Their Corrupt Profession And Pathologists who..

[Johnny Sunshine]

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I predict an 80% slash in TC billing codes for Pathology. Very soon. This will have a ripple effect of putting Ameripath, Dianon, CBLPath, OURLab, Bostwick and many others out of business or defunct well before 2020.

I expect molecular and genetic testing to likewise be massively reduced in payments to make companies like GenomicHealth teeter on the edge of bankruptcy within 10 years as well.

Well, the first half of your prophesies turned out more or less correct.

 

[LADoc00]

Well, the first half of your prophesies turned out more or less correct.

Yup but this soon the 52% slash in TC came as a surprise even to me.

Sort of like preparing for the End Times and then realizing you have 2 days and not 2 decades before it hits.

 

[pathstudent]

I like how pathologyblawg described these cuts. He seems like a reasonable person in general. Intelligent thougfuly reasoned. He described them as "life altering cuts". So don't listen to the pollyannas who say that "many pathologists wanted to see the global on our most common specimen slashed" or the "this will be great for our local group as now the specimen has been rendered unprofitable for everyone else". And no way can you make a go at paying only 18 bucks on the TC. Billing fees take 8-10%, xylene disposal runs about 50 cents a slides, you got to pay a few bucks for transcription for a report, you got pay salary and benefits to the people involved. You got to pay for service contracts on the stainer and processors. There is depreciation on the equipment. It adds up.

 

[2121115]

I like how pathologyblawg described these cuts. He seems like a reasonable person in general. Intelligent thougfuly reasoned. He described them as "life altering cuts". So don't listen to the pollyannas who say that "many pathologists wanted to see the global on our most common specimen slashed" or the "this will be great for our local group as now the specimen has been rendered unprofitable for everyone else". And no way can you make a go at paying only 18 bucks on the TC. Billing fees take 8-10%, xylene disposal runs about 50 cents a slides, you got to pay a few bucks for transcription for a report, you got pay salary and benefits to the people involved. You got to pay for service contracts on the stainer and processors. There is depreciation on the equipment. It adds up.

This is true if we are talking about one 88305-TC in isolation. But the way people profit is from scale. For example, maybe a GI does colitis biopsies in 8 different sites/containers. You can pay for the all TC expenses from the first two and the the other six are pure profit. This is how the corporate labs make their money, and it is also how in office labs make money.

 

[WEBB PINKERTON]

I like how pathologyblawg described these cuts. He seems like a reasonable person in general. Intelligent thougfuly reasoned. He described them as "life altering cuts". So don't listen to the pollyannas who say that "many pathologists wanted to see the global on our most common specimen slashed" or the "this will be great for our local group as now the specimen has been rendered unprofitable for everyone else". And no way can you make a go at paying only 18 bucks on the TC. Billing fees take 8-10%, xylene disposal runs about 50 cents a slides, you got to pay a few bucks for transcription for a report, you got pay salary and benefits to the people involved. You got to pay for service contracts on the stainer and processors. There is depreciation on the equipment. It adds up.

Imagine if you work in a lab in New York or California. The costs to run a lab in those places is astronomical. You wont be competitive with labs in other states. The only thing that would keep specimens in those areas would be protectionist laws/regs.

Maybe we can all move our labs to West Virginia or some other cheap place.

 

[LADoc00]

Imagine if you work in a lab in New York or California. The costs to run a lab in those places is astronomical. You wont be competitive with labs in other states. The only thing that would keep specimens in those areas would be protectionist laws/regs.

Maybe we can all move our labs to West Virginia or some other cheap place.

the big elephant in the room for bx companies is their shipping charges, which are out of control. that will be the biggest cost driver for TC labs going forward given that smaller practices might send out 1-2 specimens max a day at least $40 for an overnight ship out to the "cheap place" read Tenn. or Georgia.

No, stuff will begin falling back to the locale where the biopsy is done if only due to shipping expenses eating all the profit and then some! Ive been shouting this from the roof tops for 5 years to all the national lab types who will listen and only now are they realizing they need to start regionalizing resources rather than super consolidating at large national level facilities if they want to stay competitive.

Basically its counter intuitive to standard scale up economics, but the driver here will be fossil fuels especially as the TC drops likely another 20% in next 5 years (and 88342 goes with it).

My guess is the TC ends up 1/2 of the PC fee rather than the other way around. That would make it spot on the $18 for the 88305TC analysts have been saying. Also realize that since CMS rates the reimbursement on the geographic area, my region gets 30% more than the lowest "cheap place" rates.

Meaning your profit is going to get completely wiped out: first on transporting it to the cheap place and then on the fact the cheap place is getting you only a fraction of the expensive place's reimbursement!!

 

[Substance]

the big elephant in the room for bx companies is their shipping charges, which are out of control. that will be the biggest cost driver for TC labs going forward given that smaller practices might send out 1-2 specimens max a day at least $40 for an overnight ship out to the "cheap place" read Tenn. or Georgia.

No, stuff will begin falling back to the locale where the biopsy is done if only due to shipping expenses eating all the profit and then some! Ive been shouting this from the roof tops for 5 years to all the national lab types who will listen and only now are they realizing they need to start regionalizing resources rather than super consolidating at large national level facilities if they want to stay competitive.

Basically its counter intuitive to standard scale up economics, but the driver here will be fossil fuels especially as the TC drops likely another 20% in next 5 years (and 88342 goes with it).

My guess is the TC ends up 1/2 of the PC fee rather than the other way around. That would make it spot on the $18 for the 88305TC analysts have been saying. Also realize that since CMS rates the reimbursement on the geographic area, my region gets 30% more than the lowest "cheap place" rates.

Meaning your profit is going to get completely wiped out: first on transporting it to the cheap place and then on the fact the cheap place is getting you only a fraction of the expensive place's reimbursement!!

This is where virtual microscopy may come into play. The costs associated with scanning slides and maintaining the machine/infrastructure may end up being cheaper than the costs associated with transport. Even if the margin is tight, or it is a slight net loss, larger corporations might be able to take the hit provided the rest of their metrics are sound.

 

[lipomas]

This is where virtual microscopy may come into play. The costs associated with scanning slides and maintaining the machine/infrastructure may end up being cheaper than the costs associated with transport. Even if the margin is tight, or it is a slight net loss, larger corporations might be able to take the hit provided the rest of their metrics are sound.

Not so sure about that. Lots of these reference labs get a lot of their business from rural or isolated places. Big cities are often spoken for. So if you want to get all the business in Iowa, for example, you are either going to have to pay couriers to travel around the state and bring it all to one central lab or you are going to have to still pay someone to ship it. You can't have labs every 50 miles where you have a scanner. You make money by having fewer histology processing centers.

 

[KCShaw]

And didn't the virtual microscopy process/hardware end up falling under FDA as a medical device? Meaning, the underlying cost for it goes way up. I think it has/will have a significant role, but it's mitigated by that ruling and of course current quality, speed, comfort/confidence, and validation.