To use their laboratory resources more effectively, hospitals should develop better relationships with physicians and partner with other hospitals and academic medical centers to both outsource and in-source lab tests.

Outreach laboratory services not only maximize hospital revenue, but also can work as a bridge to strengthen the relationship between the hospital and its physician community. These relationships are vital as strategic assets, and, as the demands on physicians continue to multiply, they will increasingly rely on their laboratory partners for diagnostic support.

As the reference laboratory division of Mayo Clinic, Mayo Medical Laboratories has worked with hundreds of community hospital, academic medical center, and health system partners to enhance its lab service offerings. The following are best practices for establishing a laboratory organization as the premier lab resource in a community. Perhaps the biggest challenge hospital laboratory departments face is providing a comprehensive test offering in a cost-effective manner. That means maintaining economies of scale and maximizing infrastructure and staff utilization. 

Physicians increasingly seek a diagnostic resource that can meet all of their testing needs. These four key strategies can “right-size” an organization’s test offering.

Never underestimate the role of medical leadership. As obvious as it sounds, many organizations neglect to include physician input when determining the optimal test menu. Just as a pharmacy formulary is created to address the clinical needs of the patient, the laboratory’s test menu can fulfill a similar purpose in guiding clinicians to select the correct test or panel of tests for a suspected condition. Collaboration between the lab’s medical leadership and medical colleagues within the community is necessary to develop and adopt utilization guidelines and protocols.

Analyze test mix and outsource low-volume tests. Don’t be surprised to find low-volume tests such as for Lyme disease (perhaps added to the menu due to a single physician request in the past), which can be outsourced to a reference lab at a lower cost and with a better turnaround time.

Project test demand and costs to determine which tests to in-source. Conversely, analysis of send-out volumes may indicate opportunities to bring certain tests in-house. In a hypothetical example, one lab projected test volume growth, patient mix, reimbursement, send-out charges, and internal costs to determine that with a 20 percent annual volume growth, in-sourcing the test would result in a negative net operating income change of $1,273 in year one, but a cumulative positive net operating income impact of $23,751 over five years as volume rose and expenses declined.

Partner with reference laboratories. Reference laboratories can provide valuable support in the form of financial analysis, methodology assessment, and provision of clinical samples to help make in-source-versus-outsource decisions and to establish and increase on-site test volumes. More than just a line item expense for the hospital, a good reference lab partner can offer a range of clinical diagnostic cases not typically generated locally, as well as ample experience from supporting similar organizations.

Publication Date: Saturday, November 01, 2014