New Laboratory Network Selects Change Healthcare for Revenue Cycle Management

May 19, 2017, 1:00 AM
ATLANTA--(BUSINESS WIRE)--Atlanta-based LabPharm Hospital Management Services (HMS) has contracted with Change Healthcare for comprehensive revenue cycle management services in support of a national network of hospitals and independent laboratories.

LabPharm HMS, a division of LabPharm LLC, is launching an outreach laboratory alliance that will enable independent labs to partner with health systems to provide a full range of in-network diagnostic and esoteric tests for commercially-insured patients. The lab partnerships will be customized to address the requirements and capabilities of each party. They will be managed and administered by LabPharm HMS, which has developed proprietary software that facilitates integrated ordering and results-sharing between the organizations. Change Healthcare will manage the revenue cycle for LabPharm HMS alliance participants.

Jeff Solomon, chief legal officer of LabPharm, said that given the size, scope and complexity of the LabPharm network, LabPharm believed Change Healthcare was the best equipped to meet the needs of the new and growing enterprise.

“Change Healthcare was selected on the strength of its experience in laboratory billing and its national presence,” Solomon said. “Aligning with Change Healthcare will help ensure that tests are billed appropriately and that reimbursements are accurate. We are excited about working with its experts to construct a strong financial base for our new network.”

LabPharm LLC, the parent organization to LabPharm HMS, provides a range of consulting, practice management, and purchasing services to approximately 200 independent community labs nationwide. Through the LabPharm HMS network, the labs will have an opportunity to align with major health systems to provide shared testing services at the community level. Solomon said LabPharm HMS currently is negotiating with an additional 20 health systems nationwide to bring them into the alliance.

He said the new network is expected to generate benefits for all parties involved. Patients will be able to rely on local community laboratories for esoteric and routine testing, and they will not face balance billing issues that can increase their out-of-pocket costs and sometimes make these services cost-prohibitive. Labs will strengthen their competitive position by being able to offer a full spectrum of testing services, thereby improving patient care, while ideally increasing cash flow with in-network reimbursement rates. Participating hospitals and health systems can generate incremental revenue by maximizing their lab operations to take advantage of excess capacity while simultaneously accessing a potential new source for patients.

Pat Leonard, president, Technology Enabled Services, Change Healthcare, said LabPharm HMS’ alliance is a unique mechanism for aligning organizations to produce better outcomes for patients. “We are enthusiastic about working with LabPharm HMS to support this collaboration,” Leonard said. “The approach represents a new model for the provision of lab services that can help patients, labs, and hospitals. Creative solutions like this will become increasingly essential as healthcare continues to evolve.”
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