The Clinical Laboratory Business, Essay Example

There are investor concerns regarding the business of clinical laboratory. Studies show that investment in the Biotech sector is exponentially increasing year after year. It is projected that investment in the molecular diagnostics will be $7.9b by the year 2018. U.S. innovators in the clinical laboratory business are struggling due to uncertainty in regulation and reimbursement. The main objective of the CLIA is to ensure quality of laboratory testing.

There are various influencers or decision-makers in the clinical laboratory business. They include the prescribing physicians, patients (informed patient), payers (health insurers, pharmacy benefit managers, and the accountable care organizations.

Paths to Commercialization

All laboratory testing done on human beings in the United States is regulated by the Centers for Medicare and Medicaid Services. It is done through the CLI-Clinical Laboratory Improvement Amendments, which covers about 244000 laboratory entities. The CLIA program is implemented by the Division of Laboratory Services.

Accreditations

States that require laboratory and personnel licensure in the United States include California, Florida, Georgia, Hawaii, Louisiana, Montana, New York, North Dakota, Puerto Rico, Rhode, and West Virginia.

LDT and Scope of Guidance

LDT stands for Laboratory Developed Test. It is defined as an In Vitro Diagnostics. Devices are not considered to be LDTs by the FDA if they are manufactured or designed partly or completely outside the labs, which offer and use them. Some of the devices considered do not have the definition of LDT include:

• Devices owned by entities that own many clinical laboratories and transferred to other clinical laboratories within their networks.
• Devices developed by academic institutions, and then sign exclusivity agreements with private corporations, which own CLIA –certified laboratory.
• Lab contracts with specification developer with an intention of designing a new device.
• Lab contracts with the third party manufacturers to produce key components meant to be used in the device.

Codes Used in the Clinical Laboratory

CPT-Stands for Current Procedural Terminology, it is a code used for reporting medical services and procedures of various entities such as the physicians, accreditation organizations, and Health insurance companies.

ICD9- It is the standard medical coding used in hospitals in the United States. It is used with the CPT code when appropriate.

Impact of Codes on Reimbursement

• They provide payer entities with greater visibility.
• Payment and coverage policies slow in order to catch up with the enhanced adoption.
• NOC codes may be used when there are no specific codes existing.
• The personalized medicine is still population based.

There is consistency between the lecture and the current market diagnostics.