Children's Hospitals Today - Fall 2017 - 14

Put the
needle down
A test utilization management program can help children's hospitals
reduce lab costs, avoid unnecessary blood draws and improve care.
By Julie Kaylor, M.S., CGC

W

aste in health care can lead
to increased resource utilization, higher costs, and in
some instances, adverse patient outcomes. Lab testing is one area where
hospitals can make improvements to
reduce waste. Lab costs account for 4
percent of all health care costs-about
$60 billion to $70 billion dollars a year,
and areas of growing costs include
panel testing and genetic testing.
Test utilization management (TUM)
programs in hospitals put an emphasis
on high-quality, cost-effective care: the
right test, for the right patient, at the
right time, for the right price. Of the
organizations using TUM initiatives,
no two programs look alike. Some are
driven by clinical pathologists or lab
personnel; other programs are driven
by physicians who want to see change
happen within their organizations.
The first step of implementing a
TUM program is to identify a need.
At Arkansas Children's Hospital in
Little Rock, the driving force behind
implementing a TUM was the sting of
increased test costs for genetic testing. Over a period of a few years, the
hospital saw its reference lab costs
nearly double from $3 million in 2008

14

CHILDREN'S HOSPITAL S TODAY Fall 2017

to $5.8 million in 2012. In 2011, the
clinical lab sent 3,737 genetic tests to
26 different reference labs, ranging
in cost from $84 to $11,320 for a single
test. Here's how the hospital implemented a TUM program to eventually
avoid $550,000 in costs.

Finding the right flow
From 2012-14, the TUM program at
Arkansas Children's consisted of a
retrospective daily case review. The
genetic counselor reviewed a daily list
of orders, but there were drawbacks
to this method. The genetic counselor was reviewing orders after they
had been sent out and not reviewing
samples in real time. This wasted time,
money and materials by packaging
and processing samples that might
eventually be canceled. This meant the
lab might also have to reroute samples
if the courier already picked them up.
Another drawback to the retroactive review was there was no way to
ensure insurance pre-authorization.
This affected hospital reimbursement, and resulted in patients receiving unexpected bills.
In 2015, the hospital implemented a
new process that included insurance



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