Public Health Laboratories and Health System Change . Difficulty in Obtaining Payment


Several PHL directors reported concern related to difficulty in obtaining reimbursement from MCOs for testing services rendered for their members. For example, Florida's PHL director reported that some managed care clients seek treatment at a county health department without authorization from the managed care organization, have tests performed by the PHL, then face MCO refusal to pay the PHL for testing services. Similarly, in New Hampshire, the PHL noted that it performed infectious disease testing for MCO providers B who sent specimens to the PHL for testing B only to have the MCOs refuse reimbursement because the PHL was not their contracted laboratory. The Texas PHL director echoed the problem of free-riding' off of PHL services by MCOs for their Medicaid members, and its inability to obtain reimbursement from MCOs for its testing services.

Inherent in this comment is the conviction of many PHL directors, as expressed in our interviews, that a central mission of PHLs is to provide laboratory services to disenfranchised populations, regardless of their ability to pay. While providers in the health care system will typically establish financial terms with payers before delivering services, the labs almost universally provide services first and seek payment retrospectively. As noted in some of our interviews and discussed later in this document, proactive establishment of relationships with MCOs and other payers would help to mitigate this problem.