The
Honorable (your Senator/Congressman's
full name)
United State Senate
Washington, DC 20510
Dear Senator/Congressman (insert last name):
I am a constituent who is employed at a hospital laboratory (or name of
institution). I am writing in strong opposition to the laboratory competitive
bidding demonstration project mandated by Congress in the Medicare Modernization
Act (MMA). Should the demonstration occur in our district, I want you to know
that:
Beneficiary access to laboratory services will be more limited since
beneficiaries can only be served by winning laboratories.
Hospital reference laboratory (outreach) services may close, impacting
hospital profitability, jeopardizing jobs, and limiting beneficiary access
close to home.
More, if not all, Medicare non-hospital testing will be sent to large
national reference laboratories, which may be located outside our state and
may delay test results.
Since incentives exist for laboratories to decrease cost in order to submit
the lowest possible test bids, the quality of laboratory services will be
jeopardized, at a time when the healthcare focus is on improving quality and
patient safety.
If the demonstration must occur, I want to make you aware of obstacles to
hospital reference laboratory (outreach) services meeting the April, 2007 target
implementation date. Seven months before the target date, the first Metropolitan
Statistical Area (MSA) site has not yet been named, the application form has not
been released, and the bidding deadline has not been set. In contrast, the
location for the durable medical equipment competitive bidding demonstration was
announced 14 months before winners were selected. Given the time constraints,
hospitals will have difficulty with:
The bidding process – Hospitals will be required to find laboratories to
perform testing not performed in-house and obtain pricing, expand courier
systems, and determine bid pricing for over 1100 tests that will cover their
costs (based on an undetermined test volume).
Operational Issues - Setting up new patient services centers, collaborating
with other hospital outreach programs, and making other necessary operational
changes to expand capacity in order to handle the potentially larger, but yet
unknown, test volume.
Contracts –. Each hospital will be required to set up multiple reference
laboratory contracts to provide for testing that they do not perform. In
addition, hospital consortium contracts and courier contracts will need to be
negotiated to provide the required breadth of testing services. This contracting
process will take considerable time, more time then we currently have.
Information Technology (IT) changes – Expensive and time-consuming IT
initiatives will be needed to set up hundreds of new test codes, revise billing
systems, and interface with reference laboratories’ IT systems so data can enter
patients’ electronic health records.
I would ask that Congress rescind the mandate for the demonstration,
particularly since eventually implementing laboratory competitive bidding in
every metropolitan statistical area across the nation would be far too
administratively complex to be cost-effective. If, however, the demonstration
must be completed in order to show that the process is not feasible, sufficient
time must be allowed so that all laboratories have adequate time to bid and
prepare for the demonstration so that beneficiaries’ access to quality
laboratory services is not compromised.
