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Analysis shows most hospital lab visits are near lower-cost plan-subsidized providers; Commission asked to reassess initiative
Summary
A Healthcare Purchaser Alliance analysis presented to the State Employee Health Commission found 72.9% of hospital-based lab-only visits were within five miles of a plan-subsidized lab and identified price differences (28–60% higher at some hospitals). The Commission was asked to consider outreach or redesign of the initiative.
A Healthcare Purchaser Alliance presentation at the April 16 State Employee Health Commission meeting examined 2024 State plan lab utilization and recommended the Commission reassess its incentive for members to use non-hospital lab providers.
Presenters reported the plan logged 171,802 lab tests in 2024 with $5,305,001 allowed; of those, 65,336 were lab-only tests ($2,314,950 allowed) and 64,203 individual tests were performed in Maine hospitals. MaineGeneral accounted for 6,185 lab-only visits and represented roughly one-third of hospital-based lab-only visits for State members. The analysis found 72.9% of hospital lab-only visits were within five miles of a plan-subsidized lab (Labcorp via ConvenientMD, NorDx, Quest, InterMed).
The study compared allowed amounts and member cost-sharing. For example, a member who had not met their deductible would pay $35.89 at MaineGeneral while paying $0 at Labcorp/ConvenientMD; the State would pay $0 at MaineGeneral vs. $27.25 for Labcorp in that scenario. Presenters said MaineGeneral’s average allowed/service was 28–60% higher than Labcorp for common tests in 2024. Utilization of subsidized providers among employee-only contracts in 2024 was reported as Labcorp/ConvenientMD 13%, InterMed 17%, NorDx 29% and Quest 41%.
Commission staff highlighted methodological limits: growth of ConvenientMD since the initiative began in 2018 makes it difficult to isolate the initiative’s effect. Presenters also said Anthem’s contract improvements have reduced the hospital–non-hospital price gap in many cases. Recommended next steps included targeted member outreach near high-cost hospitals, tailoring incentives by distance to lower-cost options, phasing in changes until member deductibles are met, or reevaluating inclusion of low-cost physician practice labs in Anthem’s network.
The presentation concluded with a Commission action item to consider whether the plan design still generates net savings and to prioritize targeted outreach to members in proximity to high-cost hospitals.
