Federal reimbursement to laboratories

The change from a predominately fee-for-service payment environment to managed care has significantly reduced revenues for many clinical laboratories. Medicare is rapidly becoming the most favorable payor in areas with high managed-care penetration. This trend has not gone unnoticed by Congress, and congressional and regulatory initiatives are rapidly moving to reduce federal laboratory reimbursement. The efforts by both the private and public payors to further restrict payments could have a profound effect on the scope of testing offered by hospital-based laboratories. On-site nonemergent testing capability will be dependent on the cost to provide the service and the level of reimbursement. Laboratory providers have an opportunity to influence the extent of laboratory cost-reducing initiatives. To effect congressional or regulatory change requires an understanding of the federal Medicare payment system and a well-organized effort.