20 Years of Vachette

March 31, 2022

By: Mick Raich, President of RCM Consulting for Lighthouse Lab Services and Founder of Vachette

It is hard to believe it has been 20 years since I founded Vachette Pathology.  April 1, 2002 (always start a business on April Fool’s Day).

There have been some very interesting lessons learned along the way. Be discerning in who you hire, only work with people who pay their bills, etc.  With that being said, here is a list of the top ten things I have learned in 20 years of pathology and lab revenue and management:

  • We are moving to larger pathology groups. This was predicted years ago, and I have watched it come true. The reasons behind this are many: an aging workforce looking for an exit strategy, lower payments per case, and more work life balance. 
  • The government is like the mob. As I learned about business and the eb and flow I had no idea how much the government would be my business partner. Both state and federal governments are like referees in a hockey game, they should guide the game, not be part of it.  But alas, this is not human nature. People want to be significant, and our elected officials seem to be addicted to the attention. The constant changing of the rules and payments has caused innumerable sleepless nights and long conference calls. Change is the only constant.
  • Managed care did not lower the cost of health care. I saw the first managed care plans back in 1993 and saw the angles and forces they put on providers. They did not make healthcare more affordable or accessible.  They only increased the bureaucracy and minutia needed to get paid. 
  • The sky is always falling.  Bill Gates said, “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction.” This is very true.  It seems at every conference I hear how the world is ending, yet here I am 20 years later still providing my unsolicited opinion. (What was I saying about wanting significance?) The only constant is change. The next ten years will be very interesting in both the pathology and laboratory world. 
  • Pathologists are working harder for less money. In the pathology world we are seeing some of the changes predicted years ago. I remember giving a speech at for the College of American Pathologists and noting that with the coming payment decreases pathologists would have to work harder. It used to be the average pathologist did 3,200 cases a year. Now it is closer to 4,400, and guess what? They make less money.
  • The lawyers always win. As our society becomes more complex, it also becomes more litigious. I saw this with ERKA, HIPPA, the CARES Act and numerous other government “improvement” ideas. These each caused business issues and increased costs and the only one who really make money is the legal team. Kudos to the lawyers out there keeping up with the reams of changes. 
  • Cyber issues are real. I have known many businesses, labs, and hospitals who have been negatively impacted by cyber issues. I would never have imagined this when I started 20 years ago. The internet has been both a boon and bust. Here is the thing about cyber-attacks: they aren’t over. You can have cyber security and data back-ups and still get crippled by this. It’s scary.
  • Most health care fraud is pure greed. I have been lucky enough to work with some great pathology groups and labs and some very good billing firms. I have also seen some pure greed. As I built our audit process, it always amazed me when I saw billing companies and central billing offices doing things incredibility wrong. Often, we tell clients, “This isn’t right, you need to change it” only to have them ignore our warnings and fire us. I love it when I see these clients in the news later for fraudulent billing. Billing really isn’t that hard, just follow the rules. 
  • No, I will not answer your consulting questions for free. I love it when people call me and want me to answer their billing questions for free. “If you do this for us, then maybe we will work with you,” is usually their pitch. Do you think our errors and omission insurance would cover us giving free advice? Nope. You do your best as a consultant to help, but in the end, you have to feed the chickens. 
  • Yes, I would do it all again if I had the choice. I started a business with $6,000 and an idea. I had my number one employee leave and take 30 percent of the clients. (LESSON: ALWAYS HAVE NON-COMPETES.) I bought the company back after new owners were caught in a large Wall Street fraud and I had to mortgage everything I owned to buy it back. Finally, I found a great partner in Lighthouse Lab Services, quality people who keep their word. 
  • Extra credit: Artificial Intelligence will transform the billing industry over the next ten years.  Whoever wins the AI war, whether it be billing companies or insurance companies, will have the upper hand. Who are you betting on?

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