OBLs Can Positively Impact Patients' Access to Affordable Care At A Local Level
Services can be more time efficient, patient friendly and cost-effective
A growing health care delivery model known as office-based laboratories (OBLs) offers physician owner-operators greater autonomy and potentially higher revenues while providing patients with more personal and convenient care.
There were just 700 OBLs, also known as outpatient interventional suites, in the U.S. in 2021. However, favorable reimbursement and high patient satisfaction are fueling the market: It's estimated that OBLs will grow at a compound annual growth rate of 7.5% from 2024 to 2030.
"OBLs are valuable because they improve access to care," said Ammar Sarwar, MD, associate professor of radiology at Harvard Medical School and an interventional radiologist at Beth Israel Deaconess Medical Center in Boston. "They provide care closer to home compared to major hospitals and academic centers that may be further away from patients."
Providing a patient-focused experience is the goal of OBLs, according to Paramjit S. Chopra, MD, along with offering procedures faster, better and cheaper than in a hospital.
“An office-based laboratory is just a location, but it’s the physicians and health care team who work there who make patient-focused care work,” said Dr. Chopra, an interventional radiologist and founder and CEO of the Midwest Institute for Minimally Invasive Therapies (MIMIT Health). “It’s about taking care of people. We are centered on the patient, we connect with them and we collaborate for their success.”
Patient-Focused OBLs
Dr. Sarwar, who serves as the chair of economics committee for the Society of Interventional Radiology (SIR), said the inception of Medicare reimbursement for OBL services in 2008 paved the way for interventional radiologists to open office-based practices.
Most OBLs are owned and operated by a sole proprietor, such as an interventional radiologist (IR), vascular surgeon or cardiologist, a physician group or an academic practice. Single- or multi-specialty OBLs may stand alone or be a part of an imaging center.
"The cost of providing care in general is lower in an OBL versus a hospital," Dr. Sarwar said. "This reduces the cost to the health care system and insurers because the overheads are lower."
He said patients favor OBLs because they are easier to get in and out of and can offer more convenient appointment times.
Typical OBL services include vascular, cardiovascular, endovascular and cardiac procedures. Nearly all procedures are performed in less than an hour under moderate sedation or local anesthesia. Although catheter placement and removals are standard, more complex procedures are increasingly offered.
"The most common condition we treat is peripheral artery disease," Dr. Chopra said. "We've also added new procedures, such as embolization for osteoarthritis of the knee."
What’s most important, according to Dr. Chopra, is that the quality of service for the patient is excellent.
“Patients aren’t referred to OBLs, they are referred to the radiologists who work within them,” he said. “The radiologist has a responsibility to provide excellent care that is also cost-effective and equitable. Done well, and you have a patient for life.”
OBLs Offer Benefits To Radiologists
For the radiologist, OBLs provide a degree of autonomy that can improve job satisfaction and prevent burnout.
"OBLs provide a physician with greater control over their work schedule," Dr. Sarwar said. "You get to pick the equipment and provide patients with the kind of care you want."
Another upside for the physician-owned OBL is the reimbursement structure. Medicare and many other payers reimburse for procedures performed at OBLs with a global fee that includes payments for both professional and technical services. Physicians performing the same outpatient procedures in a hospital setting receive only professional fees.
However, owning and operating an OBL also comes with entrepreneurial risk. Establishing an OBL can cost up to $10 million, depending on whether you start with an existing space or build from the ground up.
"At a physician-run OBL, the physician is entirely responsible for the facility's care," Dr. Sarwar said. "This includes working with insurance companies to negotiate rates and knowing state regulations. Some states have quite strict regulations over OBLs. The landscape is evolving."
Dr. Chopra agrees that the OBL owner must remember that after the patients have been cared for, this is still a business.
He said OBL owner-operators have a unique opportunity to set their organization's culture. However, when it comes to operational issues, he said hiring the requisite business, legal and management professionals is imperative.
"Managing an OBL is complex. You must balance the concerns of all stakeholders: patients, referring physicians and staff," Dr. Chopra said. "It also requires knowledge of resource utilization and payment mechanisms, which are things some physicians don’t excel at. You can lose money if you don't bill correctly. However, if you manage it properly, the satisfaction is huge and the patient experience is great.”
For More Information
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