Office laboratory tests. Perceptions of profitability

Theoretic modeling suggests that common office tests as a group are profitable. To determine whether practicing internists perceive this profitability and whether their perceptions differ for different tests or for patients with different types of insurance coverage, the authors surveyed 111 physicians in private office practice. Respondents' estimates of receipts for tests done on patients with Medicare or Blue Cross/Blue Shield coverage were higher than their estimated costs for the testing. Estimates of receipts from Medicaid patients were lower than estimated costs of testing. After standardizing the estimated receipts from patients with different insurance coverages, the authors found that the average estimated profits for different tests on an "average insured patient" varied sixfold, from $5.99 for an electrocardiogram to $1.01 for a urinalysis. The authors suggest that perceived financial incentives are extremely variable by test. Different insurance coverages are perceived as providing varying financial incentives for testing; Medicaid provides a disincentive. Appropriate reform of the existing fee schedules should be selective by test and coverage.