Many pathologists with an economic interest in clinical pathology professional component reimbursement have yet to fully appreciate the impact of an unfavorable decision rendered by a Florida appeals court recently.

As you will read on page 5, an insurance company in Florida was actively sending letters to its patients and instructing them not to pay for clinical pathology professional services performed on lab tests ordered on their behalf. The Florida Society of Pathologists and two pathology group practices filed suit against the insurer, Central States, and won a court injunction requiring them to cease this activity in the summer of 2001. Central States appealed and, on July 12, the Fifth Court of Appeal issued a ruling which, according to plaintiff's counsel, seems to set certain requirements that a pathologist must follow to be paid for clinical pathology professional services.

For pathologists practicing in Florida, this ruling affects the way they bill for such services. It appears that judges, with little true understanding about clinical practices and long-standing reimbursement customs, have tried to fashion a solution which will please no one. From this point forward, there will be lots of frustration as payers, pathologists, and patients try to transact business under the ruling issued by the appeals court. Certainly those pathologists in Florida who bill for clinical pathology professional services will need to respond to this ruling and insure that their billing activities confirm to the appeals court's decision.

But I believe the Florida situation represents something greater. This appeals court ruling, assuming it is not reviewed and overturned by the state Supreme Court, establishes a precedent that supports the continued erosion of payment for clinical pathology professional services, both in Florida and throughout the nation. This is a disturbing development for those pathologists committed to excellence in the testing done by clinical laboratories. These are valuable clinical services and deserve appropriate reimbursement.

It might be time for clinical pathologists to use legislative solutions at the state and federal level to address the issue of fair compensation for clinical pathology services. That would be one way to counteract the short-sighted attitudes of private and government payers, who are willing to break apart the healthcare system in their attempt to squeeze out costs.

Lab Testing to Boom During This Decade

Clinical labs, pathology groups, & diagnostic manufacturers poised for plenty of growth

CEO SUMMARY: Several recent acquisitions of lab test technology by billion-dollar diagnostics manufacturers reinforce a new reality in the healthcare marketplace: developing new diagnostic tests is faster, cheaper, and more profitable than developing new pharmaceutical products. This simple economic fact is driving an amazing expansion in the number of companies developing new lab test technology.

Law & The Lab Industry

Florida Appeals Court Strikes Blow To Clinical Path Payment

Dade Behring Primed To Become Public Firm

Once-beleaguered diagnostics giant initiates comprehensive financial restructuring plan

CEO SUMMARY: Dade Behring is executing an ambitious plan to restructure its finances and become a public company. To reduce its debt burden, Dade's three owners are giving up their stock. Banks and bondholders will swap a portion of their debt for shares of stock in Dade. Once the financial restructure is completed, Dade Behring intends to expand the menu of diagnostic products and assays it offers laboratory customers.

Specialty's New CEO Reveals How His Company is Changing