COMMENTARY
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Maxfield L. Williams is the director of policy and external affairs
at COLA (Columbia, MD).
He can be reached at mwilliams@cola.org.
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Deciding whether to purchase medical diagnostic equipment can be an arduous decision-making process because of the significant expense and the perceived burden of accreditation and compliance requirements. Physicians may view the equipment as being too far removed from what they need to treat patients effectively. They may also question the value of going through the regulatory process, as it can appear to be too bureaucratic.
Today’s physician offices are better educated about running profitable labs. Such offices no longer consider labs to be merely another cost center. On the contrary, labs can be profitable entities when they are run effectively and efficiently. Running a lab effectively begins by selecting the correct test menu for the patient population. Choosing a test system encompassing tests that are appropriate for the practice and can be run cost-effectively is most desirable.
However, having an IVD system may not make sense if costly analytes are infrequently used. Savvy laboratory directors at physician offices will examine patterns associated with ordering tests by performing a patient test count for each analyte. For example, if a test is performed less than 20 times per month, a practice should consider outsourcing the test to a reference laboratory. Physician office laboratories may also build their in-house test menus around tests that require fast turnaround times to maximize patient care and benefit.
The CLIA Effect
Changes in IVD reimbursement policies and concerns over higher costs and more-stringent regulations have primarily contributed to the hesitancy by physicians to purchase complex testing equipment. By passing the Clinical Laboratory Improvement Amendments (CLIA) in 1988, the federal government established quality standards for all lab testing. Under CLIA, labs are required to extensively document their activities. The chilling effect of such heightened regulation on physician office laboratories was immediately apparent. For example, fewer labs than expected completed applications for a provisional certificate in May 1992, indicating that many had closed. When inspections were conducted for the first time to enforce the new regulations, 80% of the labs surveyed were found to be deficient in some way. By this time, the number of regulated labs had further declined by 8% since 1988.
The revised 2003 CLIA regulations made the requirements for operating a laboratory even more rigorous, which is significant for physician office labs. Under the new CLIA regulations, laboratories performing tests of moderate complexity must comply with many of the requirements of high-complexity labs. For example, laboratories must verify that a test’s performance in the lab is similar to the IVD manufacturer’s claims for accuracy, precision, and reportable range. This change, among others, requires laboratory directors and manufacturers to work together to ensure that such requirements are met.
The 2003 CLIA regulations also placed greater emphasis on effective quality control systems in the laboratory. At first glance, lab directors and staff may view such process control requirements as onerous and costly; for low-volume testing, the direct costs may sometimes outweigh the benefits. Running negative and positive controls each day when a lab performs few tests increases point-of-care testing costs. In some cases, continuing to test may not be cost-effective. However, in labs where the testing volume justifies expenditures for quality control, the reality is far different. The emphasis on quality control is intended to complement a laboratory’s ongoing quality assessment of policies, processes, and procedures, and contributes to the design of internal lab systems to detect errors. The end goal is continuous improvement, not punishment. If laboratory personnel can embrace quality control as an effective tool rather than another compliance requirement, they may be less hesitant about moving forward.
In addition, the revised CLIA regulations sought to better acknowledge those new IVD technologies with more advanced internal quality control systems. If a testing system has such internal automatic monitors, the regulations allow labs to conduct less-frequent external quality control. However, laboratory directors must establish the lab’s quality control program and make such critical decisions. This is yet another daunting challenge as laboratories are responsible for performing the due diligence for determining whether or not the IVD systems are an asset to their practices. Nonetheless, it is an opportunity for IVD manufacturers to partner more closely with the laboratories to establish a culture of quality and high-quality testing programs.
Despite such regulatory challenges since the advent of CLIA, physician practices have developed a greater understanding of the role of labs in providing customer service and quality patient care, and have consequently expanded services. By implementing a cost-effectiveness analysis of each test on a lab’s menu, physicians are seeing greater revenue generation. This has lead to an evolution in doctors’ perceptions of the lab from being a cost center to a profit center that can improve their businesses.
At the same time, the negative perceptions of IVD equipment purchases and the regulatory process are harmful to the IVD industry and laboratory medicine. Improving the quality of patient care through appropriate diagnostics should not be viewed as being more trouble than it is worth. This fear and misunderstanding may lead doctors to avoid the right IVD equipment for their labs. In many cases, doctors will select waived test systems, simply because they are free from routine oversight, and not because it is best for their practices. With such decisions, the labs may not be as effective and convenient for patients and clinicians as they could be. An IVD manufacturer’s salespeople can serve as ambassadors for the continual improvement of patient care by understanding the regulatory process and compliance requirements.
Salespeople Can Help
An IVD manufacturer’s sales force should educate their laboratory clients to establish a proper understanding of this highly regulated industry. This is the first step toward overcoming anxieties based on false assumptions. The salespeople themselves may sometimes feel overwhelmed by the large amount of information associated with the accreditation and regulatory processes. However, if they want to gain the trust of potential clients, they must become familiar enough with such processes in order to be an effective adviser and information resource.
Without sufficient knowledge of the accreditation processes, the salespeople cannot provide the information necessary to address their laboratory clients’ concerns. Even with sufficient knowledge at hand, other challenges may emerge. For example, although laboratory leadership knows how to use test results, they may not be well versed in obtaining them. The details of running a lab may be new to lab directors, and they may look to the salesperson for help. While the salespeople do not have to memorize every regulation and compliance requirement, they should be familiar with the issues that are most likely to be of concern.
A salesperson should be able to explain how soon a laboratory can start testing with new IVD equipment, and what effect or benefits the equipment will have on the quality of patient care. Payment issues will also need to be addressed. If a question cannot be answered immediately, a salesperson should conduct research and provide the information as soon as possible. The salespeople should walk their laboratory clients through the process of verifying and establishing performance specifications for newly introduced systems. In addition to providing counsel on the design of control procedures, they should prepare a “how to” binder to help the physician labs. By doing so, the salespeople can forge a relationship with their clients and evolve beyond being merely order takers.
Maintaining the Relationship
The high cost and complexity of IVD equipment creates the need for intensive after-purchase care, an aspect of customer service that should be considered a part of doing business with physician office laboratories. Newly established laboratories and those with new directors may need more help. Knowledge of equipment and compliance standards remains a salesperson’s most effective tool at this stage of the client relationship. However, after-purchase attention should be kept in mind from the beginning. The salespeople should share as much information with the laboratory client as early as possible. This can result in fewer concerns and less confusion after the sale. They should educate their clients before the purchase, which can also serve to prevent second-guessing later on.
Due diligence in education at every phase of the purchase process and beyond is the best strategy to achieve complete customer satisfaction and successful implementation. Beyond closing sales, educating the healthcare industry about the undeniable value of diagnostic technologies improves patient care and saves lives.
