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Quality and Cost

Robert A. Nordyke, MD; Thomas S. Reppun, MD; Lynn D. Madanay, MD; Joseph C. Woods, MD; Alan P. Goldstein, MD; Linda A. Miyamoto, MT, (ASCP)

Arch Intern Med. 1998;158:266-272.

Background  Current guidelines and practices for thyroid function testing are strongly affected by the usually higher patient billing charges and Medicare reimbursement for thyrotropin (TSH) vs free thyroxine (FT₄) tests, despite their comparable direct costs.

Objective  Due to recently reduced laboratory costs, to reexamine the effectiveness and cost of alternative test sequences.

Methods  Alternative test sequences involve using the TSH test first, followed, if the TSH test result is abnormal, by the FT₄ test; the FT₄ test first, followed by the TSH test; and doing both tests together. We applied these strategies to consecutive patients referred for any thyroid function test to a health maintenance organization, a multispecialty fee-for-service group, a military hospital, and a commercial laboratory. Effectiveness was determined from a literature review. The cost was determined from direct costs and the distribution of diagnostic categories.

Results  The TSH and FT₄ tests have similar sensitivities for detecting clinical hyperthyroidism and hypothyroidism. The TSH test detects subclinical function, and it monitors thyroxine treatment better; the FT₄ test detects central hypothyroidism, and it monitors rapidly changing function better. Direct costs for both were equal, but charges for the TSH test were higher. The average direct cost per patient, starting with the FT₄ test, was $4.61; starting with the TSH test, $5.90; and starting with both tests together, $6.50. Medicare reimbursements correlated poorly with costs.

Conclusions  Starting with the TSH test and reflexing to the FT₄ test provides a better first-line all-purpose sequence than the reverse. In managed care settings, the slightly higher direct cost of this approach is offset by greater clinical effectiveness. In fee-for-service settings, cost differences can be nearly eliminated by equalizing TSH and FT₄ charges to reflect current direct-cost realities. Obtaining both tests together overcomes the disadvantages of each at a slightly higher direct cost.

From the Department of Nuclear Medicine, Straub Clinic and Hospital, Inc (Drs Nordyke and Madanay and Ms Miyamoto); the Department of Medicine, University of Hawaii John A. Burns School of Medicine (Drs Nordyke and Madanay); Diagnostic Laboratory Services, Inc, the Department of Pathology, The Queen's Medical Center (Dr Reppun); the Departments of Pathology, Tripler Army Medical Center (Dr Woods), and the Kaiser Permanente Medical Care Program (Dr Goldstein); and the Hawaii MEDTEP Research Center, Pacific Health Research Institute (Ms Miyamoto), Honolulu.
(Dr Nordyke died August 23, 1997.)

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