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Related Experiment Videos

How will changes in physician payment by Medicare influence laboratory testing?

J M Eisenburg, L P Myers, M V Pauly

    JAMA
    |August 14, 1987
    PubMed
    Summary

    Physicians can profit from in-office laboratory testing, but Medicare payment limits and legislative changes impact profitability. Economic factors may influence physician decisions on ordering lab tests, affecting income and patient care.

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    Area of Science:

    • Health Economics
    • Medical Practice Management

    Background:

    • In-office laboratory testing presents a revenue stream for physicians.
    • Financial incentives are influenced by Medicare payment limits, legislation, and technology.

    Purpose of the Study:

    • To analyze the financial incentives and economic factors affecting physicians' decisions regarding in-office laboratory testing.
    • To explore the potential impact of payment reforms on laboratory test utilization.

    Main Methods:

    • Review of economic theories on physician-induced demand.
    • Analysis of legislative and regulatory changes impacting laboratory billing.
    • Consideration of technological advancements in office laboratory equipment.

    Main Results:

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    • While profitability is affected by payment restrictions, in-office testing remains a potential financial benefit.
    • Physicians may influence demand for laboratory tests, though empirical data is inconclusive.
    • Payment schemes significantly impact physician income, care quality, patient access, and Medicare costs.

    Conclusions:

    • In-office laboratory testing financial benefits are evolving due to regulatory and technological shifts.
    • Understanding physician incentives is crucial for healthcare payment reform discussions.
    • Payment reform needs to consider the downstream effects on healthcare delivery and costs.