Quest Diagnostics: Value-Based Care Cuts Costs, Boosts Care Coordination

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A Quest Diagnostics webinar discussed how lab services fit in with value-based care strategies and could reduce total healthcare costs, improve care coordination, and enhance member experiences.

Laboratories can boost care coordination, reduce healthcare spending, and improve member experiences by applying innovative value-based care strategies, according to a webinar presented by Quest Diagnostics, In Value-Based Care Innovation: Collaborating With Labs. For the webinar, Quest reviewed data from survey reports regarding trends in healthcare and highlighted the company's effort to move away from traditional fee-for-service payment models.

“Value-based care has been determined as the pathway to successfully achieve the triple-aim targets,” said Al Bowles, vice president of health plans at Quest Diagnostics. The triple aim seeks to improve overall population health, increase patient satisfaction, and reduce healthcare spending.

The webinar demonstrated that while many providers have tried to shift toward value-based care, fee-for service remains the dominant payment model. “Typically pricing on the lab side has been done pure fee-for-service, either through cap rates or negotiable fee-for-lab-service rates,” Bowles said.

Labs play a significant role within the healthcare system. Lab services identify at-risk patients, screen for and diagnose specific ailments, help physicians create intervention strategies, and influence patient engagement and management. A survey called Stalled Progress on the Path to Value-Based Care, which Quest used to gauge physician and health plan executive opinion in 2018, revealed that:

  • 72% of physicians said lab data informs most clinical decisions they make for their patients
  • 96% of physicians and health plan executives agreed that patients’ lab results could provide meaningful insights that influence care
  • 88% of physicians and health plan executives said lab data could provide insights that prescribing and claims data don't always provide
  • 84% of physicians and health plan executives said lab data deliver insights critical to bridging gaps in care

In exploring value-based approaches to lab services, Quest believes the steps are:

  • drive shared value and meaningful reduction of costs through awareness and use of high-quality, cost-effective lab providers
  • deliver coordinated and integrated programs with health plans and their physician providers to improve member outcomes
  • support members in efforts to healthy by providing a convenient and transparent experience

A 2015 Commonwealth of Massachusetts Health Policy Commission study compared commercial lab test costs. The commission found Quest Diagnostic lab spending cost 54% less than hospital outpatient departments, and prices of many tests were twice what Quest charged. The cost of a typical lab test order, consisting of a lipid panel, complete blood count, and a comprehensive metabolic panel at a hospital outpatient department was $92, while the same order was $43 at Quest.

Bowles also discussed the substantial annual costs of diabetes treatment. “Diabetes costs our system about $300 billion dollars a year. Aggressive management can help prevent costly complications including heart attack, stroke, blindness, peripheral vascular disease, and kidney failure,” he said. “However, many diabetics do not have guidelines supporting their care today. Through our population health solutions, we can provide needed care for consumers in their community. We can deliver lab testing as well as other options including retinal exams, foot exams, biometrics as well as other services. This approach has helped close diabetic gaps in care. [It has] allowed us to improve outcomes and enable systems to deliver high-quality care and hit quality metrics which, especially in the Medicare Advantage and managed Medicare [sector], will increasingly drive reimbursement.”

Cathi Rubin Franklin, senior manager of genomic services at Quest Diagnostics, believes that optimal use of genetic services could also contribute to massive savings in healthcare. “The idea is that it’s going to drive better clinical outcomes [and] ensure that testing is relevant for the patient,” she said.

Quest has made efforts to guide appropriate test selection and avoid unnecessary testing. According to data from the company,

  • 13 genetic tests are automatically verified when ordered
  • 4% of tests verified are incorrectly ordered and ultimately cancelled
  • 54% of tests verified are incorrectly ordered by physicians but are ultimately corrected

In the webinar, Franklin cited specific examples of value-based efforts to control costs. “When we find out that the patient already has a known mutation, we really only need to do 1 test, and instead of spending $6000 on a panel, the test may only cost about $500. This has a many-fold effect. The patient gets the correct test the first time, that reduces anxiety for them, and also they can get meaningful actionable results much more quickly.”

Franklin also mentioned that Quest supplies educational consultation to providers. A total of 60,000 calls are made to their genetic counselor (GC) hotline and 300,000 emails are sent annually to their GCs.

“We can also help educate your network’s physicians on genetic testing by working together. We do a lot of that when we contact the clients to make sure that test that they’ve ordered is in-fact what they want. It’s an opportunity for the genetic counselor to educate the provider so that the next time around they can get the test they want the first time,” Franklin said.