serve markets characterized by low, moderate, and high managed care penetration;
have health insurance market shares ranging from less than 10 to more than 60 percent;
operate in areas characterized by substantially different population densities and by urban-rural mix;
operate in all four geographic regions; and
include for-profit and not-for-profit plans.
The payers were asked to provide current payment rates (fees) for 22 clinical laboratory services, including 21 laboratory tests and venipuncture specimen collection. The selected laboratory services included tests for which Medicare and private payers incur relatively high cost (due to high volume and/or high cost per test), tests of different degrees of complexity, and those that represent different subcategories of laboratory tests. Included in the survey are laboratory services covered under the Medicare laboratory fee schedule as well as anatomic and surgical pathology services that are paid for by Medicare under its fee schedule for physician services.
In addition to requesting data on fees for laboratory services, survey participants were asked to provide descriptions of the primary features of their laboratory payment methodologies as well as capitation rates used for laboratory services under managed care plans.
All of the payers that participated in the clinical laboratory payment survey offered and provided fees used under different types of health plans. The Medicare-private payer fee comparisons were made separately for each benefit plan type.
The primary findings from the clinical laboratory fee comparison are the following:
Private payer indemnity plan fees are on average 31 percent higher than Medicare fees.
Private payer PPO and POS plan fees are on average 8 percent higher than Medicare fees.
Private HMO (non-Medicare, non-Medicaid HMO) fees are on average 2 percent lower than Medicare fees.
Medicaid HMO fees are on average 12 percent lower than Medicare fees.2
Fee comparisons were also made between Medicare and Medicare HMO fees for laboratory services. However, the combination of a small sample of