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Doctors Order More Lab Tests When They Own the Labs

Say you find a weird splotch on your arm and go to a dermatologist to get it checked out. The doctor may order a biopsy and send the tissue sample to an outside lab for analysis. Alternatively, the clinic might have an in-house lab to examine the sample. In that case, the clinic gets paid for both the procedure and the analysis, so perhaps it’s not surprising that doctors order more tests when they run their own labs.