Don’t Let Your Value Be Overshadowed By a Few Bad Apples

Lately we’ve been reading a lot about alleged violations to the False Claims Act, the anti-kickback statute, and the Stark Law. My experience consulting with many diagnostic companies over the years has shown me that it is not unusual for the misdeeds and poor business practices of a few bad players to overshadow the important contribution made by clinical laboratories. It’s also a mistake. We cannot continue to allow the misdeeds of those few bad players to taint all of the valuable work contributed by clinical laboratories to the healthcare ecosystem.

There are a lot of downstream effects of this behavior on legitimate labs. By using independent sales and marketing companies, waiving co-pays, and providing other incentives, unethical companies make it harder for high-integrity laboratories to get approval from payors to cover new, valuable tests. We see this in particular in the pharmacogenetics arena. Because a small number of companies provide inappropriate incentives for expensive tests, payors are often left with the perception that the growing adoption of this testing is purely based on these incentives and are therefore hesitant to reimburse for them even when there is clinical evidence of medical necessity.

When laboratory companies are speaking to XiFin about becoming our clients, we are also doing our due diligence on them. Our aim is to work with those laboratories who have compliant business philosophies that align with their excellent clinical capabilities. We continue to see news of laboratories looking for loopholes and operating at the ethical fringes, often “attorney shopping” to get a legal opinion that they believe they can use to defend inappropriate behaviors. Most often, these may even be well meaning attorneys who are just not as familiar with the complexities—and sometimes not totally black and white aspects—of the laboratory business. There are a number of firms who specialize in this space and are extremely well versed in the intricacies of clinical lab law. They are not hard to find!

Similarly, some labs will seek outsourced billing vendors that will follow their billing instructions without questioning appropriateness or RCM software vendors that will create dubious customer-requested functionality. In fact, the OIG has provided compliance guidelines for billing services and expressed opinions regarding the inherent danger of customized billing software being ripe for corruption; thereby putting both billing services and software vendors on notice that compliance is not the sole responsibility of a provider.

XiFin takes this responsibility very seriously and provides the only RCM system with built-in compliance logic going far beyond simple edits for claims submission or medical necessity. Clinical lab insiders know that our compliance requirements are strict and can sometimes run counter to what some would say is “common market practice.” This is no excuse for later claiming ignorance of the law or shifting blame to an attorney unqualified in clinical lab law for providing incomplete or inaccurate counsel. The excuse that laboratories need to engage in these behaviors to remain competitive, will also no longer fly.

As we’ve seen in recent lawsuits, the Justice Department, payors and other parties bringing suit are no longer limiting their claims to the business entity alone. Executives, owners, board members, and even investors have been named parties in some recent suits. The Yates memo has been a component of some recent suits where executives and others can no longer deny accountability for illegal behaviors of their staff, or often contracted sales forces. This is why clinical lab leaders need to pay attention to more than just the top line and be acutely aware of the business practices of their firm and its employees and contracted agents and ensure that these practices follow the same high levels of integrity that our science does. We have also seen many repeat offenders who just change the names of their companies, or move to new ones, continuing their inappropriate behaviors. In today’s high-tech world, overseeing agencies can pinpoint such offenders much quicker.

Furthermore, physicians often reinforce these bad practices by attempting to get one lab to follow noncompliant policies set by one of their competitors. Those physicians too are increasingly finding themselves the subject of audits, penalties and recoupments for government payors or kicked out of payor networks for commercial payors. Sales reps need to be able to articulate the risks of working with such laboratories to physicians rather than relying on similarly bad policies to enable them to get the business.

It is frustrating to compete with companies that are cutting corners and trying to skirt the law. I believe we need to hold ourselves to a higher standard. The value of our business is too important to let a few dishonest firms taint the important contributions that clinical labs make to the healthcare industry.

At XiFin, we design our laboratory solutions to make it easy for our clients to ensure they stay in compliance with regulations and OIG guidelines. We encourage laboratories looking for new revenue cycle management and laboratory information systems, for example, to see our built-in compliance capabilities not as a limiting factor but as a way to help ensure they stay out of legal trouble. Labs that are serious about compliance select partners that are equally committed to compliance. One of the reasons that I choose to affiliate myself with XiFin is because of the commitment of our executive team to be involved and take a stand for clinical laboratories.