DURHAM, N.C. – Blue Cross and Blue Shield of North Carolina (Blue Cross NC) has found success in delivering cost savings in another area of health care – laboratory services. The company, working with Avalon Healthcare Solutions, a leading lab benefits manager, generated $112 million in cost savings and quality improvements for Blue Cross NC members in 2020 by better managing lab services.
The cost savings go together with improved health outcomes through the reduction of inappropriate lab testing and better adherence to clinical guidelines.
“Our collaboration with Avalon has given us more insight into improving the quality and reducing the cost of lab services for our members,” said Roberta Capp, MD, chief medical officer at Blue Cross NC. “As these results show, Blue Cross NC members benefit from our ongoing efforts to make health care better, simpler and more affordable.”
Lab services often don’t get as much attention as other components of rising health care costs. But lab work is the most common intervention in U.S. health care, with an estimated 13 billion tests administered annually.1 Lab services have become a more critical component of high-quality, cost-effective care in recent years, especially as tests have become more complex and the number of inappropriate tests has remained high.2 The COVID-19 pandemic also has demonstrated the essential role lab testing plays in health care.
Blue Cross NC’s agreement with Avalon, in place since 2017, has led to improvements in lab services in three areas:
Network: The use of labs within the Blue Cross NC provider network now stands at 99% of all lab services, up from 86% before the company’s agreement with Avalon.
Medical policy: Avalon’s program provides greater clarity and automation for providers to follow clinically accepted, peer-reviewed guidelines for lab services.
Utilization management: Providers use the Avalon pre-service approval system – designed for provider ease of use – to help ensure lab services are appropriate and covered.
“Laboratory testing is a pivotal part of high-quality, cost-effective health care,” said Bill Kerr, MD, CEO of Avalon Healthcare Solutions. “Our close collaboration with Blue Cross NC is a leading example of how insurers and health care companies can work together to improve outcomes and increase value for consumers.”
About Blue Cross and Blue Shield of North Carolina
Blue Cross and Blue Shield of North Carolina (Blue Cross NC) is committed to making health care better, simpler and more affordable. We have been driving better health in North Carolina since 1933, working to tackle our communities’ greatest health challenges. Blue Cross NC serves its customers and communities of more than 4.2 million members, including approximately 1.1 million on behalf of other Blue Plans. Blue Cross NC is an independent licensee of the Blue Cross and Blue Shield Association. Visit Blue Cross NC online at www.bluecrossnc.com. All other marks are the property of their respective owners.
About Avalon Healthcare Solutions
Avalon Healthcare Solutions is the world’s first and only Lab Insights company, bringing together our proven Lab Benefit Management solutions, lab science expertise, digitized lab values, and proprietary analytics to help healthcare insurers proactively inform appropriate care, reduce costs, and improve clinical outcomes. Working with health plans across the country, the company covers more than 22 million lives, and delivers 7-12% outpatient lab benefit savings. Avalon is pioneering a new era of value-driven care with its Lab Insights Platform that captures, digitizes, and analyzes lab results in real time to provide actionable insights for earlier disease detection, ensuring appropriate treatment protocols, and driving down overall cost. For more information about Avalon, please visit www.avalonhcs.com.
1 “Laboratory Medicine: Advancing Quality in Patient Care,” American Association for Clinical Chemistry, October 2015: https://www.aacc.org/advocacy-and-outreach/aacc-policy-reports/2015/laboratory-medicine-advancing-quality-in-patient-care. Accessed September 2021.
2 “Use of Laboratory Decision System as a Test Utilization Management Tool in Clinical Settings, Current and Future Perspectives,” Journal of Clinical and Laboratory Medicine, September 2019: https://www.sciforschenonline.org/journals/clinical-laboratory-medicine/JCLM128.php. Accessed September 2021.