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[Guest guest]

Dear Senator Weinberg ( senweinberg@... ),There has been much discussion on our medical e-mail list about ways to deliver excellent medical care and continue to cover office overhead that continues to go up every year.

http://health.groups.yahoo.com/group//

Medicare and Medicaid fees often don't keep up with the cost of running a business - even when they remain the same or go up by 1% -- the cost of running a business (overhead) goes up more than that each year - creating a defacto fee cut.

http://www.ama-assn.org/ama1/pub/upload/mm/31/costpaymentgap.pdf

But Medicare/Medicaid was not the issue currently being discussed on the medical list.

Our discussion was about ways to cover increasing office overhead and deliver great care.

Many on the list suggested adding labs to the office.

While most on the list are small 1-2 doctor practices and can't afford to run a full lab in the office, many on the list are able to draw labs in the office, send them to a lab company (ie LabCorp, Quest), and bill the patient with some profit to cover the overhead and cost of doing the labs.

Several physicians from New Jersey pointed out that this simple idea was illegal in their state.

It appears you were a co-sponsor of the legislation P.L.1997, c.156 45:9-42.41a that essentially prevents physicians from billing for labs they send off to an outside lab company.

Was this the intent of the legislation? To prevent physician offices from pass-through billing of labs done for their patients?

In Colorado, the "off the shelf" cost for a patient to get labs at the hospital or through LabCorp/Quest is much higher than the lab fees these companies charge me.

I am able to order Test X, charge a small fee above the cost to me, and save money for the patient compared to the patient paying "off the rack" fees directly to the lab company.

As you can see below, the cost that the lab company charges to the general population for someone paying cash is much higher than the cost to me as the client ordering the tests from them.

I am able to charge much less than the "off the rack" fees -- saving the patient money and adding a little profit for my office to cover declining reimbursements.

I am sure our e-mail list and especially those practicing in New Jersey would be interested to hear about your thoughts on this issue.

Small primary care offices work on slim margins and even 5-10% extra can be the difference between a primary care physician making a living and going out of business.

Thanks for your thoughts.

Locke, MD

www.LockeFamilyMedicine.com

==================================================================http://www.lorettaweinberg.com/where_i_stand.html

BILLS, RESOLUTIONS AND CONCURRENT RESOLUTIONS SIGNED INTO LAW OR FILED WITH THE SECRETARY OF STATE FROM 1992 TO 2007

A-1889P.L.1997, c.156Quigley/WeinbergRequires clinical laboratories to bill recipients of services directly.

http://www.helplinelaw.com/usa-statutes/new%20jersey/TITLE%2045%20PROFESSIONS%20AND%20OCCUPATIONS/45:9-22

45:9-42.41a. Clinical laboratory bills, presentation 1. A clinical laboratory shall present or cause to be presented a claim, bill or demand for payment for clinical laboratory services directly to the recipient of the services , except that the claim, bill or demand for payment may be presented to any of the following: a. An immediate family member of the recipient of the services or other person legally responsible for the debts or care of the recipient of the services; b. A third party payer including a health insurer, a health, hospital or medical services corporation, a State approved or federally qualified health maintenance organization in which the recipient of the services is enrolled, a governmental agency or its specified agent which provides health care benefits on behalf of the recipient of the services, and an employer of the recipient of the services who is responsible for payment of the services, provided that billing these payers is consistent with the terms of any applicable contract between the payer and the recipient of the services;

c. A hospital or skilled nursing facility in which the recipient of the services is or has been an inpatient or outpatient; d. A substance abuse program in which the recipient of the services is or has been a participant; and

e. A nonprofit clinic or other health care provider whose purpose is the promotion of public health, from which the recipient of the services has received health care.

Upon the request of the health care provider who requested the clinical laboratory services, a clinical laboratory shall notify the health care provider of the amount of the claim, bill or demand for payment that was presented to the recipient or the recipient@s responsible third party pursuant to this section. Notwithstanding the provisions of this section to the contrary, in the case of a clinical laboratory which performs services at the request of another clinical laboratory, the clinical laboratory may present the claim, bill or demand for payment to the requesting clinical laboratory.

Notwithstanding the provisions of this section to the contrary, nothing in this section shall affect a contractual agreement between a clinical laboratory and a third party payer regarding presentation of a claim, bill or demand for payment directly to that third party payer. L.1997,c.156,s.1.