Capital BlueCross and a lab-testing company have teamed up for a new venture that aims to increase price transparency and reduce costs.
Theranos, the health startup that performs routine lab tests with only a fingerprick's worth of blood, is the preferred lab-work provider for the Pennsylvania-based health insurer.
The partnership is significant on many levels. First, most individuals pay little attention to lab bills because blood work is covered through insurance. And lab costs vary greatly--a basic panel of blood work can range from about $120 to $600.
Second, Theranos--which received lab technology approval from the Food & Drug Administration last week--is the first lab to publish all of its pricing, the announcement points out. All of its tests are at least 50 percent below the Medicare reimbursement rate.
The move also could be a step in the right direction for insurer initiatives to promote price transparency throughout the industry.
The huge variation in medical costs demonstrates a need for price transparency, particularly for services where there's often little variation in quality. For instance, a study from the Blue Cross Blue Shield Association found that the costs for knee and hip replacements vary by more than $20,000 from one place to another, FierceHealthPayer previously reported.
"As an insurance company, it is important for us to partner with companies that have the commitment not only to the highest standards, but also to constant innovation," Gary D. St. Hilaire, president and CEO of Capital BlueCross, said in the announcement. "We found Theranos to be the best lab for our members--they've been able to implement their unmatched technology and processes to provide access to accurate, convenient and low-cost lab testing services."
- here's the announcement