See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/12609547

Pathologists’ Roles in Clinical Utilization Management A Financing Model for

Managed Care

Article  in  American Journal of Clinical Pathology · April 2000

DOI: 10.1309/14BQ-F3A7-1D14-X7PN · Source: PubMed

CITATIONS READS
16 69

2 authors, including:

Jim Jian Zhao

Orlando University
17 PUBLICATIONS   104 CITATIONS   

SEE PROFILE

Some of the authors of this publication are also working on these related projects:

cell population biology View project

All content following this page was uploaded by Jim Jian Zhao on 14 July 2015.

The user has requested enhancement of the downloaded file.

AJCP / UTILIZATION MANAGEMENT AND COMPENSATION
Pathologists’ Roles in Clinical Utilization Management
A Financing Model for Managed Care
Jim Jian Zhao, MD, PhD, MBA,1 and Aaron Liberman, PhD2
Key Words: Pathologists; Utilization management; Financing; Compensation; Laboratory; Hospital; Managed care
Abstract
In ancillary or laboratory utilization management,
the roles of pathologists have not been explored fully in
managed care systems. Two possible reasons may
account for this: pathologists’ potential contributions
have not been defined clearly, and effective
measurement of and reasonable compensation for the
pathologist’s contribution remains vague. The
responsibilities of pathologists in clinical practice may
include clinical pathology and laboratory services
(which have long been well-defined and are
compensated according to a resource-based relative
value system–based coding system), laboratory
administration, clinical utilization management, and
clinical research. Although laboratory administration
services have been compensated with mechanisms such
as percentage of total service revenue or fixed salary,
the involvement of pathologists seems less today than in
the past, owing to increased clinical workload and time
constraints in an expanding managed care environment,
especially in community hospital settings. The lack of
financial incentives or appropriate compensation
mechanisms for the services likely accounts for the
current situation. Furthermore, the importance of
pathologist-driven utilization management in
laboratory services lacks recognition among hospital
administrators, managed care executives, and
pathologists themselves, despite its potential benefits
for reducing cost and enhancing quality of care. We
propose a financial compensation model for such
services and summarize its advantages.
336 Am J Clin Pathol 2000;113:336-342
During the past decade, the rapid emergence and
predominance of managed care organizations (MCOs) has
dramatically altered America’s system for provision of
health care. Changes have affected those who work in
hospital settings and those in private medical practices,
including specialty and primary care1,2 (A.L., unpublished
data, 1998). Fundamental outcomes of managed care,
according to many advocates, have been reduced total cost
for health care utilization and enhanced quality of care3-7
(A.L., unpublished data, 1998).
A major goal of managed care, which has been used for
many years in health maintenance organizations, is utilization
management. From the perspective of an MCO, there are 3
primary considerations: ancillary utilization; referral utiliza-
tion; and hospital utilization. Utilization management in each
of its forms involves using materials and human resources to
make definitive judgments about the appropriateness of a
prepaid treatment regimen. This service often is provided by
a nonphysician, and pathologists rarely are involved, even if
other physicians are participating.
Pathology is unique in the medical professions, func-
tioning as a bridge between clinical medicine and basic
science. In routine clinical practice, pathologists often are
referred to as a physician’s physician whose job it is to
provide tissue and body fluid diagnosis, as well as relevant
clinical information to fellow clinicians, while assisting in the
clinical diagnoses and treatment of patients. Moreover, the
pathologist is involved much more in nonmedical work
compared with most clinicians. This involves laboratory
operations management, financial planning, technology
development, and fulfilling miscellaneous duties.8,9 In terms
of level of reimbursement or compensation, a pathology
service is considered to be somewhere between primary care
and the majority of specialty services (eg, surgery, orthope-
dics, and cardiology). Therefore, using a pathology and
© American Society of Clinical Pathologists

laboratory service, when medically appropriate and indi-
cated, is less costly than using most invasive procedures
provided by procedure-oriented specialties.
In an increasingly dominant managed care environ-
ment, the pathologist can have a substantial role in
managing health care resources, especially pathology and
laboratory services. Pathologists already serve as utilization
managers in some settings. For example, it is not
uncommon for a pathology resident to control laboratory
utilization (serving as a gatekeeper) of blood products and
“sendout” tests in a university hospital. The laboratory can,
in these instances, produce substantial cost savings.10-12
However, most pathologists practicing in community hospi-
tals are largely neither proactive nor active in clinical
utilization management (J.J.Z. and G. Pearl, unpublished
data, 1999). Hence, the pathologists’ expertise and training
in management has not been used fully by hospital admin-
istrators, MCOs, or other third-party payers. Two reasons
seem fundamentally important. First, defining specific cost-
effective roles for the pathologist can be elusive. Second,
determining how such work can be compensated within the
current framework of the health care reimbursement system
represents a daunting challenge.
This article aims to clarify several issues about these
challenges through a review of the current pattern of clin-
ical pathology practice, including clinical utilization
management and reimbursement mechanisms. Recommen-
dations about what can be done to resolve the current
dilemma are followed by suggestions about how patholo-
gists and laboratory physicians can be used to reduce the
cost of care and enhance its standard of quality.
Roles of Pathologists in Clinical
Services and Utilization Management:
Current Compensation Mechanisms
In general, the primary roles of pathologists in clinical
practice can be classified in 3 general categories: clinical
pathology and laboratory services; laboratory administration;
and clinical utilization management.8,13 An additional role is
basic or clinical research, which originates from grant
support or personal interest and often involves experimental
work, product development, or clinical trials.
Clinical Pathology and Laboratory Services
Tissue or Fluid Diagnosis or Surgical Pathology
Diagnostic Services
The service mainly involves evaluating tissue biopsy,
fine-needle aspiration, and surgical resection specimens.
These are traditional tasks that most surgical or anatomic or
© American Society of Clinical Pathologists
AJCP / SPECIAL ARTICLE
general pathologists perform routinely. The service or
surgical pathology professional component is reimbursed
under Medicare part B, using approximately 30 Current
Procedural Terminology14 (CPT) codes (CPT codes between
88104 and 89399) with the modifier “-26.”
Physician Interpretation of Laboratory Test Results
Pathologists routinely interpret electrophoresis patterns,
hematology smears, blood crossmatching, and coagulation test
results. The results are then correlated with a particular clinical
situation and sometimes are followed by direct communica-
tion with the patient’s physician. This service also is reim-
bursed under Medicare part B, and there are approximately 20
CPT-coded tests with a laboratory physician interpretation
component with the modifier -26 representing approximately
2% of the total CPT-coded tests. A large portion of laboratory
tests, representing almost 1,000 CPT-coded tests, do not have
an interpretation component.3,14
Physician-to-Physician Consultation Service
Included are consultation services provided by a patholo-
gist to other clinicians on behalf of individual patients. Such
consultation services are not applicable to routine physician-
to-physician conversations, and they are reimbursable only if
the services meet the following criteria: (1) requested by the
patient’s attending physician; (2) related to a clinically signifi-
cant abnormal test result; (3) result in a written narrative
report that is included in the patient’s medical record; and (4)
result in an interpretation requiring a medical judgment by a
laboratory physician. The consultation does not have a tech-
nical component (ie, modifier -26 is not included). Two CPT
codes are used for clinical pathology consultation under the
Medicare fee schedule: CPT code 80500 is for a limited clin-
ical pathology consultation without review of a patient’s
history and medical records; CPT code 80502 is for the
comprehensive clinical consultation of a complex diagnostic
problem with review of a patient’s history and medical
records.14 In addition, there are 3 CPT codes for blood bank
physician services that have neither a technical component
nor attached modifiers: CPT codes 86077, 86078, and 86079
are used for interpretation and to generate a written report for
specific blood bank services.14
An additional physician-to-physician service, which
has not been explicated and coded by the CPT codes, is the
consultation about appropriate selection or utilization of
specific tests for medical (as well as financial) reasons,
including introduction of new state-of-the-art technologies
for clinical diagnosis and treatment. For example, introduc-
tion of molecular diagnostic testing, such as HIV genotyping
and phenotyping and polymerase chain reaction for the
factor V Leiden mutation may provide a more cost-effective
outcome for management of AIDS and for thrombotic risk
Am J Clin Pathol 2000;113:336-342 337
Zhao and Liberman / UTILIZATION MANAGEMENT AND COMPENSATION
assessment, respectively. This service will be become even
more important in an increasingly dominant managed care
environment.10,11
Physician-to-Patient Consultation Service
The pathologist rarely participates in a direct patient
consultation service. Consulting clients primarily are clini-
cians. The medical opinion or judgment of a pathologist
about diagnosis, treatment, and follow-up to an individual
patient always is given through clinicians—surgeons, oncol-
ogists, or others. In some situations, however, direct consul-
tation services may be more appropriate for patients or their
families, in part because many pathologists, particularly
those with a subspecialty, may be more knowledgeable than
are other clinicians about a specific topic of interest to a
patient. For example, pathologists who specialize in prostate
and urologic pathology may be in a better position to inter-
pret the correlation between the prostate-specific antigen
level and biopsy results than a general surgeon or a urologist.
They also may lend a greater level of objectivity about treat-
ment options based on the latest and best medical knowl-
edge, rather than offering options based on a specialty bias or
a financial motivation. Moreover, in the emerging areas, such
as risk assessment for cancer and other diseases, and in
preventive medicine, the pathologist specializing in molec-
ular genetics is likely to become one of the most appropriate
specialty physicians for direct patient and family counseling
for the selection of specific diagnostic tests and interpretation
of results. Compensation for a patient consultation includes
many CPT codes, such as 99401 through 99404, 99411,
99412, 99429, and 99429, that are designed for evaluation
and management (E/M) services.14 Theoretically, these codes
apply to all physicians. We contend that compensation based
on these CPT codes for direct patient consulting services
should apply to pathologists, as long as such counseling has
been given properly.
Laboratory Administration
A pathologist customarily holds the directorship of the
clinical laboratory of a hospital or independent laboratory.
According to the College of American Pathologists, the
pathologist is responsible for the selection and implementa-
tion of laboratory test procedures that will fulfill the mission
of the laboratory, which includes the reporting of test find-
ings, proper performance of tests, and employment and
training of properly qualified personnel.
The laboratory director is responsible for establishing
and modifying test procedure manuals and general labora-
tory policies. A number of pathologists participate actively in
the daily operation and management of the laboratory. These
activities include dealing with important laboratory-related
problems, quality control and quality assurance issues, and
338 Am J Clin Pathol 2000;113:336-342
inspection, accreditation, and regulatory issues. Daily or
regular laboratory rounds with residents, fellows, and the
chief technologist are among the responsibilities of the labo-
ratory director. Many pathologists also are involved directly
in the development and introduction of new tests or methods
in the laboratory according to advances in technology and
the needs and expectation of clinicians.
Teaching residents and technical staff is one of the
primary jobs of academic pathologists. This includes tuto-
rials, lecturing, conferencing, and other forms of learning.
The aforementioned services usually are compensated
through a fixed portion of the annual laboratory budget
specifically allocated for medical directorship of the labora-
tory. In the community hospitals in which the pathologist is
not a hospital employee but has a contractual relationship
with the hospital’s laboratory administration, the hospital-
employed nonpathologist laboratory administrator is largely
responsible for daily laboratory management, including
important managerial decisions such as human resource
management, operational planning, and budgeting and finan-
cial management. As a consequence, the pathologist has
become more passive in the administrative activities (J.J.Z.,
personal observations and communications, 1999).
Clinical Utilization Management
During the past several decades, several publications
and a study have addressed the utilization management role
of pathologists, particularly for laboratory test utilization12-
14 (J.J.Z. and G. Pearl, unpublished data, 1999). Generally
speaking, these roles largely involve specialized clinical
pathologists in the areas of microbiology, hematology, and
molecular pathology. Surgical pathologists, however, rarely
are involved in management in a community hospital
setting. Despite the fact that it has not been widely prac-
ticed in most pathology practices, utilization management
of laboratory services, conceptually and practically, can be
divided into 2 basic elements: general management and
individual case management
General Management of Clinical Utilization of Laboratory
Services
This is the process of planning, organizing, directing,
staffing, and controlling for effective utilization of laboratory
testing. Specifically, a pathologist can serve actively as a
general manager and will establish policies and procedures
for the effective utilization and control of laboratory services.
The specific goal is to deal with test- and disease-specific
issues having medical and financial variables that may affect
the cost and quality of care. To achieve effective utilization
management of laboratory services, the pathologist must be
an effective manager and participate in the primary activities
any effective manager should be able to perform, including
© American Society of Clinical Pathologists

interpersonal, informational, and decision-making activities.
For example, a pathologist can chair a clinical utilization
committee composed of representatives from various clinical
departments, such as emergency and internal medicine
services, and from administrative departments, such as
finance, operations, and marketing. The committee must
have specific goals and an action plan with measurable
objectives for service quality and financial performance.
Moreover, the pathologist must establish a utilization
management program that may include preauthorization,
concurrent review, and retrospective review of laboratory
testing. This requires a substantial effort and the time and
resources necessary for establishing a cost-effective profes-
sional activity. An effective cost-control mechanism requires
that utilization management be separated from general labo-
ratory operations. A financial process providing positive and
negative incentives should be established to encourage
responsible performance.
Individual Case Management of Laboratory Service
Utilization
This service includes 2 parts: one deals with individual
requests for specific tests ordered by clinicians, and another
involves coordination of laboratory services for individual
patients in case and disease management. A common service
is the pathologist-conducted concurrent review of sendout
tests. When an expensive or rare test is ordered (often by
clinical residents), the pathology resident reviews the
medical necessity of the request based on established poli-
cies and medical knowledge and then decides whether the
request should be rejected or approved. This has been an
effective approach for reducing the cost of laboratory
sendout testing.10 (J.J.Z. and G. Pearl, unpublished data,
1999). Surprisingly, many of the inappropriately ordered
tests were related to typing errors, with a rate of approxi-
mately 40% of total orders (J.J.Z. and Gary Stack, MD, PhD,
unpublished data, 1995). The application and expansion of
medical informatics, such as a computerized physician order
entry system to modulate, guide, and monitor utilization of
pathology and laboratory services, will have a substantial
role in optimizing ancillary services provided to individual
patients. This may relieve the time-consuming burden for
personal utilization monitoring by a pathologist and, instead,
permit focus of the pathologist’s time on operating a more
efficient clinical utilization management system. Further-
more, this will become especially important when ambula-
tory patient classifications are implemented in the near
future15,16; these classifications will establish a prospective
payment mechanism for hospital-based outpatient services.
Unfortunately, the utilization management of laboratory
services, for general and individual case management as
described, does not exist in the majority of pathology prac-
© American Society of Clinical Pathologists
AJCP / SPECIAL ARTICLE
tices. Thus, we suspect that the lack of such pathologist-
involved utilization management has contributed substan-
tially to the overutilization of laboratory services in many
hospital systems and MCOs, resulting in a significant cost
increase. Two main reasons are likely. First, pathologist-
driven utilization management is far from well-defined,
including specific roles and outcome measurements. Second,
there is no financial mechanism for compensating the contri-
butions pathologists have made, even if they involve such
work. Hence, it is important to rectify the problem to opti-
mize the utilization of laboratory services.
Proposed Financial Model
for Compensating Pathologist-Driven
Utilization Management
As previously noted, compensation for the administra-
tive responsibility of a laboratory director (eg, pathologist)
commonly is generated as a fixed salary or from a portion of
the annual budget or revenue of the laboratory, which
customarily is determined by the hospital administration
(when the pathologist is an employee) or by contract (when
the pathologist has a contractual relationship with the
hospital). In addition, utilization management of a laboratory
service generally is not specified or required by the hospital
or by contract. In some instances, compensation for labora-
tory management represents a fixed percentage of annual
revenue for laboratory testing. In this scenario, the conse-
quences of a reduction in total utilization may lead to a
decrease in a pathologist’s compensation, although the finan-
cial effect could be positive for the hospital, the MCO, and
the purchaser (employer)1,2 (A.L., unpublished data, 1998).
There are several potential financial mechanisms to be
considered for compensating a pathologist-driven utilization
management program. The methods chosen will depend on
the working or contractual relationship between providers
(hospital or physician service) and payers (health mainte-
nance organization or MCO).
Two typical examples would be capitation vs fee for
service. However, before considering either, one must deter-
mine whether a pathologist-driven utilization management
program can be effective without compromising the standard
of care and without increasing the total cost of care. Total
cost of care is the expense associated with managing a
patient, a disease, or an episode. For example, laboratory
service is considered a part of inpatient care costs for a
specific diagnosis-related group. Thus, the total cost and
total revenue must be carefully measured, calculated, and
analyzed for each given situation. For example, performing a
molecular test would cost much more than performing a
routine test (eg, $200 vs $20, respectively), but rapid and
Am J Clin Pathol 2000;113:336-342 339
Zhao and Liberman / UTILIZATION MANAGEMENT AND COMPENSATION
accurate results provided by the former may save 3 days of
hospital stay, which in turn would save more than $1,200.
In the meantime, the standard of clinical care must be
closely monitored with an outcomes-oriented quality assur-
ance program to prevent underutilization or overrestriction of
laboratory testing.3 To achieve such decision-making, the
pathologist’s involvement in utilization management is
necessary. If utilization of laboratory services can reduce
total cost to the most effective level, without compromising
quality, utilization management would be considered effec-
tive and worthy of payment. This may include appropriate
compensation for a pathologist who organizes and performs
the service.
Based on available information and analysis, we offer a
financial model for compensating the work of the patholo-
gist. The purpose of this model is to make the pathologist-
driven utilization management model financially feasible and
justifiable so that it can be “tested” in the world of clinical
practice with the ultimate goal of controlling the total cost of
care and enhancing the overall quality of care.
The model is predicated on 4 assumptions: (1) The
pathologist who participates in the management of labora-
tory utilization service will possess proper training and skills
in laboratory management including medicine, technology,
and business administration. (2) The utilization of laboratory
and pathology services is a necessary part of controlling the
total cost of care. (3) Utilization management as an addi-
tional management service in laboratory administration
should have a specifically defined compensation mechanism.
(4) The CPT codes for evaluation and management of indi-
vidual patient services are applicable to the clinical utiliza-
tion management of individual patients or cases attended by
pathologists, if properly coded and based on the rules of
Medicare part B physician services.2,3,14
The proposed financial compensation model combines a
fixed level of compensation for conducting the utilization
management service program with a variable compensation
component for individual patient billings. Fixed compensa-
tion would be provided through the entity financing the labo-
ratory services to the pathologist who directs the utilization
management of laboratory testing. The variable component
would be billed to payers, eg, MCOs, Medicare or Medicaid,
or Blue Cross/Blue Shield, using a CPT code fee schedule.
The following formula would apply:
Total Pathologist Compensation =
Fixed Level of Compensation + Variable Level of Compensation
For general utilization management, it is very important
first to define the specific and measurable goals, such as
what percentage of the tests, including in-house and sendout,
is likely to be controlled and reduced and how much effort or
time will be required to achieve the goals. Certainly it would
340 Am J Clin Pathol 2000;113:336-342
be difficult to set a realistic goal at the beginning, and many
assumptions need to be made according to specific tasks,
benchmarking data, historical data, and published literature.
After determining basic estimates on the potential target of
utilization reduction and the time or effort to be spent, the
amount of a fixed compensation (or cost) for performing the
work can be calculated. Incentives or penalties should be
considered for exceeding or falling short of the expected and
agreed-upon targets. For example, if it is expected, according
to retrospective experience or studies, that a reduction of 5%
of total ordered tests should occur with utilization manage-
ment, the pathologist should be recognized with a bonus or a
penalty depending on the amount of the withhold (the
amount and percentage of reimbursement held back until the
end of a contract year pending conformance with utilization
objectives) and the deviation of the results.
The variable compensation component can be matched
by Medicare part B physician service. The case-specific
billable services include the following: (1) concurrent
review and gatekeeping of the physician-requested tests
(sendout and in-house) for individual patients with follow-
up telephone calls, written reports for interpretation, or
both; and (2) conducting case management services
through medical conferencing or telephoning physicians or
other health care professionals. Several sets of CPT codes
may be applicable for these services.
One set includes CPT codes 80500 and 80502 that are
used specifically for clinical pathology consultation (see
“Physician-to-Physician Consultation Service”). However,
these codes are designed for requested interpretation of
abnormal results. At a minimum, therefore, these codes
may be applicable (1) when the pathologist performs “stan-
dard” clinical pathology consultations and while the pathol-
ogist participates in case or disease management; or (2)
when, after reviewing and rejecting an original order, an
alternative test is suggested and performed, abnormal
results are obtained, and a written report is entered in the
patient’s medical record. For example, suppose an expen-
sive molecular genetic test is ordered by a family physician,
and the order is rejected by the pathologist because the test
is still at an experimental stage. The pathologist suggests
another simple molecular test, and an abnormal result is
obtained and interpreted by the pathologist who writes a
follow-up report. In this circumstance, the services
provided by the pathologist should be billed and compen-
sated by Medicare or another payer for the pathologist’s
work and contribution to cost reduction.
A second set of CPT codes includes those for case
management services applicable to all physicians. E/M
generally is divided into broad categories, such as office
visits, hospital visits, and consultations. According to
published guidelines, the basic format of the levels of E/M
© American Society of Clinical Pathologists

services is the same for most CPT codes: First, a unique
code number is listed. Second, the place and/or type of
services is specified (eg, office consultation). Third, the
content of the service is defined (eg, comprehensive history
and comprehensive examinations). Fourth, the nature of the
presenting problem(s) usually associated with a given level
is described. Fifth, the time typically required to provide
the service is specified. The portion of the E/M services
that is aligned most closely with the clinical pathologist’s
work is counseling. This term is defined as a discussion
with a patient, family, or both about one or more of the
following subjects: (1) diagnostic results, impressions,
and/or recommended diagnostic studies; (2) prognosis; (3)
risks and benefits of management (treatment) options; (4)
instructions for management (treatment) and/or follow-up;
(5) importance of compliance with chosen management
(treatment) options; (6) risk factor reduction; and (6)
patient and family education.
The CPT codes for case management services that
may apply directly to clinical utilization management
provided by a pathologist or other physicians are E/M-
related CPT codes,14 such as CPT codes 99361 through
99362 for team conferences, 99371 through 99373 for tele-
phone calls, and 99374 through 99380 for care plan over-
sight services. All these codes may need further explo-
ration to determine whether they are applicable for clinical
utilization management of laboratory services under
specific circumstances. Furthermore, one likely applicable
option for individual patient CPT code billing is the
unlisted service code 99499 for unlisted evaluation and
management services. This is unusual, variable, or may
require a special report demonstrating the medical appro-
priateness of the service. The report should include perti-
nent information with an adequate definition or description
of the nature, extent, and need for the procedure, and the
time, effort, and equipment necessary to provide the
service.14
The CPT codes for consultation may or may not be
applicable to the pathologist performing the utilization
management service. By definition, this is a type of service
provided by a physician whose opinion or advice about the
evaluation and/or management of a specific problem is
requested by another physician or other appropriate source,
and a physician consultant may initiate diagnostic and/or
therapeutic services. However, these CPT codes are used
for clinical specialty consultation in 4 subcategories: office,
initial inpatient, follow-up inpatient, and confirmatory.
By applying the model as proposed, the clinical utiliza-
tion management directed and performed by pathologists
becomes financially compensable through the current
Medicare part B reimbursement CPT coding system. With
laboratory compensation for general utilization management,
© American Society of Clinical Pathologists
AJCP / SPECIAL ARTICLE
clinical pathologists could then have a financial incentive for
their contribution, as an effective cost-reduction resource, to
utilization management of laboratory services that in turn
will lead to a reduced total cost of care while at the same
time raising the standard of care.
What we recommend is basically a risk-adjusted
payment method in which the level of compensation is tied
inextricably to utilization and cost. Because the pathologist
is in a unique position to observe utilization and assess its
outcomes, the risk-adjusted payment method will provide a
mechanism for the pathologist to successfully reconcile the
issues of utilization and cost. Overall, we suggest that the
risk-adjusted payment method may create opportunities for
new plans to use pathologists as key players in clinical
utilization management.17
Conclusion
Utilization management is one of the cornerstones of a
managed care system. In our view, the laboratory patholo-
gist represents an ideal physician specialty to organize,
plan, lead, and direct these services. 3,18 A pathologist-
driven clinical utilization management program19-26 would
serve as an effective means for reducing the total cost of
care and enhancing the quality of care for a hospital, an
MCO, a medical practice, and, ultimately, the patient. All
parties, including pathologists, may be able to use the
financial mechanisms we propose to operate a pathologist-
driven utilization management system.
In the managed care environment, the pathologist
should interact more proactively with physicians, patients,
and families.27-33 Moreover, hospital administrators and
MCOs should recognize the clinical knowledge and
management experience that pathologists can contribute
toward controlling the total cost of care and enhancing the
cost-effectiveness of clinical services. The cost of
pathology services certainly is less than that for procedure-
concentrated clinical specialists. Although they may not be
as familiar with specific clinical interventions (eg, medica-
tion vs surgery) as are specialists, the pathologist almost
certainly will be more objective in medically necessary
advocacy.3,18 Finally, as ambulatory patient classifications1
(A.L., unpublished data, 1998) become part of the reim-
bursement matrix in the very near future, the need for
active involvement on the part of pathology practitioners in
clinical utilization management will be increased, and the
opportunities to be included in the reimbursement chain
should be enhanced. However, the fruition of that goal will
depend largely on the concerted efforts of pathologists to
alter a heretofore disproportional expectation of work
without proper compensation.
Am J Clin Pathol 2000;113:336-342 341
Zhao and Liberman / UTILIZATION MANAGEMENT AND COMPENSATION
From the 1Laboratory of Diagnostic Molecular Pathology,
Department of Pathology and Clinical Laboratories, Orlando
Regional Healthcare System, Orlando, FL, and 2Health Services
Administration, University of Central Florida, Orlando.
Address reprint requests to Dr Zhao: Oxford Diagnostics for
Surveillance Care, 12301 Lake Underhill Rd, Orlando, FL 32828.
Acknowledgment: We thank Gary Pearl, MD, PhD, for
reviewing and providing valuable suggestions for the manuscript.
References
1. Kongstvedt P. Essentials of Managed Health Care. Gaithersburg,
MD: Aspen; 1997.
2. Becker S. Physician’s Managed Care Success Manual: Strategic
Options, Alliances and Contracting Issues. St Louis, MO:
Mosby–Year Book; 1999.
3. Vance RP. Outcomes management: new opportunities in a
shrinking pathology market. Arch Pathol Lab Med.
1997;121:1183-1186.
4. Halm EA, Causino N, Blumenthal D. Is gatekeeping better
than traditional care? survey of physicians’ attitudes. JAMA.
1997;278:1677-1681.
5. Blumenthal D, Epstein AM. The role of physicians in the
future of quality management. N Engl J Med. 1996;335:
1328-1331.
6. Clancy CM, Kamerow DB. Evidence-based medicine needs
cost-effectiveness analysis. JAMA. 1996;276:329-330.
7. Bodenheimer T, Grumback K. The reconfiguration of US
medicine. JAMA. 1995;271:85-90.
8. Laposata M. What many of us are doing or should be doing in
clinical pathology. Am J Clin Pathol. 1996;106:571-573.
9. Lambird PA. Practicing pathology through multiple hospitals
at multiple sites: practice management issues. Arch Pathol Lab
Med. 1995;119:650-652.
10. Kirby EJ Laposata M. The nature and extent of training
activities in clinical pathology required for effective
consultation on laboratory test selection and interpretation.
Arch Pathol Lab Med. 1997;121:1163-1167.
11. Valenstein P. Managing physician use of laboratory tests. Clin
Lab Med. 1996;16:749-771.
12. Jones J. A method for developing outcome measures in the
clinical laboratory. Clin Lab Manage Rev. 1996;10:115-119.
13. Hardwick FD, Morrison IJ, Cassidy AP. Clinical Laboratory:
past, present, and future: an opinion. Hum Pathol.
1985;16:206-211.
14. American Medical Association. Current Procedural
Terminology, CPT 1999. 4th ed. Chicago, IL: American
Medical Association; 1998.
15. Connelly PD, Aller DR. Outcomes and informatics. Arch
Pathol Lab Med. 1997;121:1176-1182.
342 Am J Clin Pathol 2000;113:336-342
View publication stats
16. Tuthill M. Pathology informatics to the rescue. Adv Med Lab
Prof. 1999:19-21.
17. Glim M, ed. Faulkner & Gray 1999 Medicare Managed Care
Sourcebook. New York, NY: Faulkner & Gray; 1999.
18. Goldberg-Kahn B, Sims KL, Darcy TP. Survey of management
training in United States and Canadian pathology residency
programs. Am J Clin Pathol. 1997;108:96-100.
19. Winkelman JW, Brugnaara C. Management training for
pathology residents, II: experience with a focused curriculum.
Am J Clin Pathol. 1994;101:564-568.
20. Skootsky SA, Oye RK. The changing relationship between
clinicians and the laboratory medicine specialist in the
managed care era. Am J Clin Pathol. 1993;99(4 suppl 1):S7-
S11.
21. Friedman BA. The challenge of managing laboratory
information in a managed care environment. Am J Clin
Pathol. 1996;105(4 suppl 1):S3-S9.
22. Miler TE. Managed care regulation: in the laboratory of the
states. JAMA. 1997;278:1102-1109.
23. Kricka LJ, Parsons D, Coolen RB. Healthcare in the United
States and the practice of laboratory medicine. Clin Chim
Acta. 1997;267:5-32.
24. Leverone JP. The hospital-based group in a managed care
environment: reading the terrain. Arch Pathol Lab Med.
1995;119:642-645.
25. Ross SJ. New roles for pathologists in the 21st century. Hum
Pathol. 1998;29:107-109.
26. Elevitch FR. Practicing pathology as a healthcare contractor:
business planning for managed care. Arch Pathol Lab Med.
1995;119:612-617.
27. Sodeman TM. Managing opportunities under managed care.
Arch Pathol Lab Med. 1995;119:591-597.
28. McDonald JM, Smith JA. Value-added laboratory medicine in
an era of managed care. Clin Chem. 1995;41:1256-1262.
29. McDonald JM. The value-added laboratory: an opportunity to
merge research and service objectives. Clin Lab Manage Rev.
1997;11:88-92.
30. Keith DM, Garza D. Utilization management in hospital
clinical laboratories: a local analysis. Clin Lab Manage Rev.
1996;10:124-133.
31. De Cresce RP, Lifshitz MS, Logue LJ. Managed care and the
hospital laboratory: survival of the fittest. Clin Lab Manage
Rev. 1994;8:472-474.
32. Wilding P. The changing role of the clinical laboratory
scientists: coming out of the basement. Clin Chem.
1995;41:1211-1214.
33. Vance. RP. Resource utilization and outcomes management:
opportunities for the entrepreneurial pathologist. Clin Lab
Manage Rev. 1997;11:318-321.
© American Society of Clinical Pathologists