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Boston Globe Investigation Finds Many Boston Hospital CEOs Also Sit on Healthcare Company Boards

Cozy relationships between hospital chief executives and healthcare companies they do business with may raise ethical questions

If hospital employees, including pathologists, wonder why their hospital uses a certain company’s products and services it may be because their Chief Executive Officer (CEO) sits on the Board of Directors of the same companies from which the hospital buys products and services. That’s the suggestion in a recent Boston Globe investigative report.

In “Boston’s Hospital Chiefs Moonlight on Corporate Boards at Rates Far Beyond the National Level,” The Boston Globe reported that, in Boston, hospital CEOs at the city’s academic medical centers frequently sit on the boards of healthcare companies with which their hospitals do business. However, because the investigative reporters did not list the healthcare companies which had Boston hospital CEOs as board members, clinical laboratory managers and pathologists cannot determine from the article if their medical laboratories are using products from those same companies.

According to The Globe, five of seven CEOs and Presidents of Boston’s major teaching hospitals also receive compensation for serving as directors of publicly traded companies. And in their roles as corporate board members, hospital CEOs often receive stock in these companies, making the value of their remuneration potentially worth millions of dollars, The Globe reported.

Not Illegal, But Is It Ethical?

The Boston Globe’s investigation noted that such moonlighting, while not unheard of elsewhere in the country, is commonplace in Boston, raising ethical concerns despite conflict-of-interest policies aimed at limiting outside relationships.

“Hospitals in Boston and elsewhere that allow this outside corporate work do so under the terms of conflict-of-interest policies,” The Globe reported. “A Globe review of more than a dozen hospital conflict-of-interest policies across the country found more similarities than differences. Almost all require hospital trustees to approve a hospital chief’s outside board work and consider certain factors, such as the amount of business a company does with the hospital and time required.

“But the policies offer limited evidence about actual practices,” The Globe added. “Trustees typically retain significant discretion over what is permitted or barred, and their deliberations are generally hidden from the public. It is hard to tell if the relative rarity of hospital chiefs in other cities holding outside directorships is because of a lack of interest or opportunity, or is the result of trustees saying no.”

One of the hospital chief executives The Globe’s investigation highlighted was former-Boston Children’s Hospital CEO Sandra Fenwick. While there, The Globe noted, she also held a seat on the board of for-profit telehealth company Teledoc Health, and during her tenure as Children’s CEO, she lobbied Massachusetts legislators for telehealth funding at the start of the COVID-19 pandemic.

Though no laws were broken, some questioned the ethics of such actions. Nevertheless, The Boston Globe wrote that “Debra O’Malley, a spokesperson for Secretary of State William Galvin’s office, said Fenwick’s actions did not appear to violate the law: She is required to disclose in writing to the state that she is a lobbyist for the hospital and the bills she lobbied on, which she did, O’Malley said. That information is publicly available.”

And though The Globe reported that Boston Children’s Hospital had “declined to answer detailed questions about [Fenwick’s] lobbying efforts,” the paper wrote that a hospital spokesperson said, “[Fenwick’s] directorships are publicly disclosed in filings with the Securities and Exchange Commission.”

Fenwick retired from Boston Children’s Hospital in March 2021. The Globe noted that at that time her Teledoc Health stock, which was compensation for her board work, was worth $8.8 million. Additionally, she had been paid $2.7 million annually as CEO of Boston Children’s Hospital.

carl-elliott-md-phd-at-podium
“It does seem like buying influence and it’s hard to imagine what else it would be,” Carl Elliott, MD, PhD (above), Professor in the Center for Bioethics and the Department of Pediatrics at the University of Minnesota told BioPharma Dive. “If you’re actually trying to buy scientific knowledge, then you wouldn’t really be going after CEOs. What they have is power.” (Photo copyright: Boston University.)

Avoiding Conflicts of Interest

Bad optics created by a Boston hospital CEO receiving seven-figure compensation for serving on the board of directors of a publicly traded company is not new. In July 2020, former Brigham and Women’s Hospital President Elizabeth Nabel, MD, resigned from the board of biotech company Moderna (NASDAQ:MRNA) “to alleviate any potential concern about the conduct or the outcome of the COVID-19 vaccine trial when Brigham and Women’s Hospital was identified by NIH as one of the clinical sites for the Phase 3 trial,” a Moderna press release states.

On March 1, 2021, Nabel also stepped down as Brigham and Women’s Hospital president. She then rejoined the Moderna board of directors on March 10, 2021, the press release noted.

In a STAT editorial, titled, “Hospital CEOs, Med School Leaders Shouldn’t Sit on For-Profit Health Care Company Boards,” endocrinologist and former Dean of Harvard Medical School Jeffrey Flier, MD, wrote, “As dean, I vigorously supported the value of robust interactions between faculty and industry to advance innovation and human health, and still do. In my current status as a professor of medicine at Harvard, I serve on several for-profit and not-for-profit boards. I learn from this work, and I believe I am making useful contributions as a board member. But I also believe that the considerations governing such relationships should be judged differently for institutional leaders.”

Flier maintains there are multiple reasons why hospital and medical school leaders should not sit on for-profit boards despite the expertise they bring to the table, including:

  • The time commitment required,
  • The “extraordinary compensation packages” they receive in their full-time jobs,
  • The potential for complicated “business intersections,” and
  • The risks to an “institution’s reputation for integrity.”

“I recommend that hospital CEOs and academic leaders at the level of Deans and Presidents devote their full attention to their well-compensated day jobs and defer positions on the boards of for-profit companies—and the unavoidable conflicts they raise—to the post-leadership phase of their careers,” Flier wrote.

While cozy relationships between hospital and academic medical center leaders and for-profit healthcare companies may not directly impact hospital pathologists and staff, it is worth staying aware of potential conflicts of interest.

Andrea Downing Peck

Related Information:

Boston’s Hospital Chiefs Moonlight on Corporate Boards at Rates Far Beyond the National Level

Elizabeth Nabel Steps Down as President of Brigham and Women’s Hospital to Team Up with Husband’s Biotech Joint–Report

Betsy Nabel, MD, to Step Down as President of Brigham Health

Dr. Elizabeth Nabel Rejoins Moderna’s Board of Directors

Hospital CEOs, Med School Leaders Shouldn’t Sit on For-Profit Health Care Company Boards

American Society for Clinical Pathology Website Was Hacked Last Year, Possibly Exposing Credit Card Information of Members and Online Shoppers

Thousands of pathologists and medical technologists may have had their private data stolen, though ASCP investigators did not confirm this as having happened

For a “limited time period” in 2020, the American Society for Clinical Pathology (ASCP) was the target of a cyberattack that “potentially exposed payment card data as it was

being entered” on the ASCP website, according to a letter sent by McDonald Hopkins PLC to then Attorney General of the New Hampshire Department of Justice (DOJ) Gordon MacDonald.

In “World’s Largest Pathologists Association Discloses Credit Card Incident,” Bleeping Computer, an information security and technology news publication, reported that on March 11 of this year, ASCP employees discovered their system had been hacked. They discerned that between March 3, 2020, and November 6, 2020, the attackers had access to personal information being entered on the ASCP website.

Bleeping Computer noted that “[the ASCP’s] member list includes over 100,000 medical laboratory professionals, clinical and anatomic pathologists, residents, and students.”

In a statement, the ASCP said, “We have recently been informed that our e-commerce website was the target of a cybersecurity attack that, for a limited time period, potentially exposed payment card data as it was entered on our website.”

The information that may have been stolen includes data pertaining to individual credit cards, names, credit or debit card numbers, expiration dates, and security codes (CVV) associated with the cards.

“We engaged external forensic investigators and data privacy professionals and conducted a thorough investigation into the incident,” the ASCP said in the statement.

What Type of Cyberattack?

Evidence collected regarding the ASCP data breach indicates the attack was part of a web-skimming assault. This involves installing malicious software, such as Magecart, onto an e-commerce website. The software acts like a credit card skimmer enabling hackers to steal the payment and personal information of customers who are actively inputting data on the attacked website. The data is then sent to remote servers where it is used for identity theft or sold to others.

ASCP says it does not permanently store any of its customers’ payment card data on its servers, Bleeping Computer reported, which greatly reduces the potential risk of data exposure. In addition, the ASCP has implemented extra security measures to prevent similar incidents from happening in the future.

“We resolved the issue that led to the potential exposure on the website. We implemented additional security safeguards to protect against future intrusions. We continue ongoing intensive monitoring of our website, to ensure that it exceeds industry standards to be secure of any malicious activity,” the ASCP said in a statement, Bleeping Computer reported.

Peter-Blum-Group-Product-Manager-Google
In an interview with TechRepublic, Peter Blum (above), Group Product Manager at Google, discussed steps companies can take to proactively manage the threat of Magecart cyberattacks. “The best defense against Magecart attacks is preventing access,” Blum said. “Online companies need a solution that intercepts all of the API [application programming interface] calls your website makes to the browser and blocks access to sensitive data you have not previously authorized. This prevents any malicious script, or any non-critical third-party script, from gaining access to information your customers enter on your website. This same system should also have a monitoring component to alert companies when a third-party attempts to access sensitive information.” (Photo copyright: LinkedIn.)

Federal Rules and Regulations Concerning HIPAA and PHI

The ASCP stated they have no evidence that any customer data was misused after the incident occurred. As of May 14, the organization has not made an official, public statement regarding the situation on their website, but affected individuals and jurisdictions were sent letters to inform them of the data breach.

With over 130,000 current members, Chicago-based ASCP is the largest professional organization for pathologists and clinical laboratory professionals in the world. The organization did not respond to Dark Daily’s inquiries regarding the data breach.

Although no reported violations under the Health Insurance Portability and Accountability Act (HIPAA) occurred in this ASCP data breach, it should be noted that there are rules under HIPAA for data breaches where Protected Health Information (PHI) may have been compromised.

Under the HIPAA Breach Notification Rule, entities that were hacked must perform the following steps:

  • Notify affected individuals within 60 days of the discovery of the breach. Notification should include a brief description of the breach, the types of information that may have been compromised, steps affected individuals should take to protect themselves from potential harm, and a description of what the organization is doing to investigate the breach, mitigate the harm, and prevent further breaches.
  • Hacked entity must inform the Secretary of Health and Human Services (HHS) within 60 days of the breach discovery if 500 or more individuals were affected. For breaches affecting less than 500 people, the breached entity may notify the Secretary of such breaches on an annual basis.
  • For breaches affecting more than 500 individuals, the hacked entity must also provide a notification to prominent media outlets, typically via a press release, that serve the state or jurisdiction.

This breach of credit card information belonging to a sizeable number of pathologists and clinical laboratory professionals using the ASCP website should be a warning to all clinical laboratories and anatomic pathology groups—along with colleges, societies, and associations—that their websites and digital systems can be attacked at any time. As well, clinical laboratory and pathology professionals should be on the alert and take all necessary precautions to minimize the possibility of data breaches.

—JP Schlingman

Related Information:

World’s Largest Pathologists Association Discloses Card Incident

American Society for Clinical Pathology—Incident Notification

ASCP Disclosed Payment Card Web Skimming Incident

Magecart Attack: What It is, How it Works, and How to Prevent It

What is Magecart? How This Hacker Group Steals Payment Card Data

A Deep Dive into Magecart: What Is Magecart?

Compliance Perspectives: State Enforcement Raises Liability Risks of Data Breaches

Three Federal Agencies Warn Healthcare Providers of Pending Ransomware Attacks; Clinical Laboratories Advised to Assess Their Cyberdefenses

University of California San Diego Researchers Demonstrates How Easily Medical Laboratory Systems and Devices Can Be Compromised, Putting Patient Lives at Risk

WannaCry Ransomware Holds Critical Data Hostage Worldwide, Including UK’s National Health Service and Russia’s Interior Ministry

Irish Cancer Society Report Shows Patients May Wait Two Years or More for Genetic Cancer Test Results

Wait times blamed on the Irish National Health System’s ‘overstretched’ services and ‘under-resourced’ commitment to cancer genetic testing done by medical laboratories

Histopathologists in the UK and anatomic pathologists in the US understand the important role predictive genetic testing can play in helping patients understand their risk for certain types of breast, bowel, and ovarian cancers. While timely access to cancer testing may be routine in the United States, a report out of Ireland reveals patients in that country’s government-run healthcare system may have to wait up to two years or more for genetic counseling and testing.

The report, titled, “The Unmet Need in Cancer Genetic Services:

Conducting an Environmental Scan of the Cancer Genetics Services in an Irish Context Underpinned by a Mixed Methods Approach,” was prepared for the Irish Cancer Society (ICS) by researchers at the University of College Cork (UCC). The researchers found that genetic services have been “starved of investment and resources,” leaving healthcare workers involved in cancer genetics and follow-on services “doing incredible work,” but “completely overstretched.”

UK Patients in Need of Genetic Services Are Switching from Public to Private Healthcare

While early access to genetic testing can provide opportunities for preventative treatments or earlier diagnosis of cancer, many patients in Ireland with a family history of cancer must wait months or years for genetic services. UCC Nursing Professor and Physiologist Josephine Hegarty, PhD, lead author of the ICS report, stated in a news release that “public cancer genetic services are overstretched. Waiting lists exist at every point on the pathway for people who need genetic services.”

She added, “Many patients spoken to seemed to abandon the waiting for overstretched public services in favor of paying for private testing and treatment.” 

While the ICS report’s survey sample size was small—154 patients, family members, or members of the public—the data revealed:

  • One in seven respondents waited 13-24 months and one in 27 waited over 24 months for counseling and testing appointments.
  • Many people had changed from the public health system to private healthcare to speed up access to genetic testing.
  • The cumulative waiting time from referral to counseling, testing, receipt of genetic test results, and onwards to screening, surveillance, or prophylactic treatments [aka, preventive healthcare] can be up to four years, which patients see as time lost in terms of cancer prevention and early intervention.

Barriers to Genetic Services Affect Treatment Decisions

A separate survey of 52 healthcare professionals highlighted barriers for accessing services with six in 10 respondents saying they are under-resourced and four in 10 concerned about access to follow-up surgery for patients deemed to be at high risk.

In the ICS news release, breast cancer patient Margaret Cuddigan said genetic testing was not available to her at diagnosis.

“In those 13 months waiting for a result, I went through chemotherapy, a lumpectomy, and radiotherapy on my breast, only for a double mastectomy to be required once the BRCA mutation was known. Had I known this earlier, my course of treatment could have been very different,” Cuddigan said.

“I had to postpone a radiation treatment to go up to Dublin from Cork to do the genetic test, as it would have taken up to another 12 months in Cork, and then I waited over four months for the results. Once I received the news of the gene mutation, I had to navigate a path of risk-reducing surgeries,” she noted, adding, “I researched and sought out a surgeon myself.”

Long Waits for Genetic Testing Are Common in Single-Payer Healthcare

The waiting list for genetic cancer testing has long been an issue in Ireland. A 2017 article in the Irish Examiner, titled, “Woman Faces 18-month Wait for Vital Cancer Test,” brought to light the 18-month waiting time for BRCA1 and BRCA2 mutation testing for breast cancer. While the COVID-19 pandemic has further exacerbated the backlog of cancer treatment services, such issues are not new in single-payer healthcare systems.

Across the Irish Sea in Great Britain, some patients have experienced delays of six months before getting cancer test results. In “Shortage of Histopathologists in the United Kingdom Now Contributing to Record-Long Cancer-Treatment Waiting Times in England,” Dark Daily reported how prolonged wait times for cancer test results in the United Kingdom’s National Health Service are one disadvantage of a government-run, single-payer health system. With limited funds, frequently the government health program under invests in certain clinical services. It is not until several years later that the underinvestment reveals itself in the form of lengthy wait times.

Meanwhile, it is cancer patients and their families who pay the price for underinvestment because delays in their cancer test results then delay timely treatment decisions. This is particularly true when an immediate start of therapy for an aggressive form of cancer is imperative.

ICS Executive Director, Advocacy and External Relations, Rachel Morrogh, argues the solution is prioritizing cancer prevention within the Health Service Executive, which runs Ireland’s national healthcare system.

“The reality is the focus must be on urgent care, but we’re missing chances to keep people healthy (through genetic testing),” Morrogh told the Irish Independent. “We can prevent four in 10 cancers, but we have to prioritize prevention. There needs to be a significant investment and the expansion of capacity across all the follow-on services that someone with a genetic risk of cancer may need, focusing on the development of a dedicated and resourced pathway for them.

Rachel-Morrogh-and-Donal-Buggy-standing-together
Irish Cancer Society’s Director of Advocacy and External Affairs Rachel Morrogh (above left with Donal Buggy, Director of Services, Delivery and Innovation at ICS) maintains that “Patients [in the Irish healthcare system] need a dedicated group of multi-disciplinary doctors following them so that they can be offered options and psycho-oncology support when they need it.” She added, “The government must now listen to patients and those working in our hospitals and provide more resourcing and staffing.” (Photo copyright: Irish Examiner.)

The ICS report found that limited access to timely genetically-guided health and oncology services is the result of multiple barriers to care.

“It is apparent from engaging directly with service users that waiting lists exist at every point on the pathway for people who need genetic [cancer testing] services,” the report states. “For those who may have a genetic risk of cancer, the wait times for access to [genetic cancer] testing alone (before counselling treatment, prophylactic surgery, etc.) can be up to two years. Barriers to accessing cancer genetic services include costs of tests, long processing time for referrals to tests, restrictive referral criteria, and difficulty in accessing information on cancer genetic services.”

In the forward she wrote for the ICS report, ICS Chief Executive Officer Averil Power said her organization would continue its push for improved access to genetic testing services. “Government needs to not only expand capacity for testing and counselling, but also ensure that the follow-on services that are needed by people diagnosed with a genetic risk of cancer are in place and can be accessed swiftly.”

The ICS report is another reminder to histopathologists in the UK—as well as anatomic pathologists in the US—that a single-payer healthcare system comes with its own flaws and access-to-care issues.

Andrea Downing Peck

Related Information:

Some People Waiting Over a Year for Cancer Risk Tests: Report

The Unmet Need in Cancer Genetics Services: Conducting an Environmental Scan of the Cancer Genetics Services in an Irish Context Underpinned by a Mixed Methods Approach

People with Family History of Cancer Waiting Two Years for Genetic Testing, Study Finds

Woman Faces 18-Month Wait for Vital Cancer Test

Irish Cancer Society: €30m Needed for ‘Stretched’ Services

Shortage of Histopathologists in the United Kingdom Now Contributing to Record-Long Cancer-Treatment Waiting Times in England

Federal Prosecutors Signal That Accuracy of Theranos’ Blood Tests Will Be Centerstage in August Fraud Trial

Pregnant former Theranos CEO Elizabeth Holmes makes her first court appearance in 15 months as pre-trial maneuvering continues in court case involving clinical laboratory tests

During pre-trial hearings for the August fraud trial of former Theranos CEO, Elizabeth Holmes, federal prosecutors signaled that the accuracy of Theranos’ blood tests will be center stage in their arguments. This latest installment in the continuing saga of defunct medical laboratory testing company Theranos took place when a now-pregnant Holmes made her first in-person court appearance in 15 months.

Clinical laboratory scientists have watched with interest as the often-delayed fraud trial inched closer to its new August 31 start date. After being delayed multiple times by the COVID-19 pandemic, United States District Court Judge Edward Davila ruled in March that the trial would be postponed from mid-July to late August due to Holmes’ pregnancy. She is due to give birth in July.

Do Prosecutors Lack Proof Theranos’ Blood Testing Technology Is Inaccurate?

As Dark Daily previously reported, Holmes faces 12 counts of wire fraud charges for alleged false claims that Theranos created a revolutionary technology for performing a wide range of clinical laboratory tests using a tiny amount of blood.

In its 2015 investigative report, The Wall Street Journal (WSJ) alleged Theranos had not disclosed publicly that the vast majority of its tests were performed with traditional machines purchased from Siemens AG and other companies, not its so-called breakthrough proprietary technology.

The recent three-day hearing provided Holmes’ attorneys and federal prosecutors with an opportunity to present arguments regarding what evidence can be presented at the upcoming trial.

In a recent article, the WSJ reported that Holmes’ attorneys argued the US Attorney’s Office for the Northern District of California built its case on anecdotal evidence.

According to the WSJ article, Holmes’ defense team is trying to block the government from calling patients and medical professionals to testify about the accuracy of Theranos’ blood test results. At the hearing, attorney Amy Saharia, a Williams and Connolly LLP partner, maintained prosecutors lack scientific proof Theranos tests were inaccurate. She called this lack of scientific evidence a “gigantic hole” in the government’s case.

“This trial is going to be a sprawling mess of irrelevant, prejudicial evidence,” she told the court, the WSJ reported.

Saharia added, “We have all become very familiar with testing this year. Testing involves many different variables,” CNBC reported. “What the government offers is without scientific basis, they have to establish Theranos technology was responsible for erroneous results. Just because it happened doesn’t mean it was because of Theranos technology.”

pregnant-elizabeth-holmes-leaving-courthouse
Pregnant Elizabeth Holmes (above), who is due to give birth in July, is seen entering the courtroom for a pretrial hearing in San Jose, Calif., in the US government’s fraud case against the former Theranos CEO. In the hearing, federal prosecutors indicated the accuracy of Theranos’ clinical laboratory tests will be at the center of their arguments. (Photo copyright: Mercury News.)

Defense Tries to Block Pathologists’ Testimony

During the second day of hearings, federal prosecutors responded to defense attorneys’ efforts to block clinical pathologist Stephen Master, MD, PhD, from testifying. Defense attorneys argued the government is using Master as a “parrot” and argue his views on Theranos’ blood tests are “based on emails and customer complaints” not personal familiarity with the tests, CNBC reported. Master is Division Chief and Director, Metabolic and Advanced Diagnostics at Children’s Hospital of Philadelphia, and an Associate Professor of Pathology and Laboratory at University of Pennsylvania’s Perelman School of Medicine.

Assistant US Attorney Robert Leach, however, said, “Miss Holmes went out, told the world and told investors: we have tests with the highest accuracy rate,” adding that testimony from their expert witness “puts the lie to that,” CNBC reported.

Before Theranos was dissolved in 2018, Holmes rose to rock star status in Silicon Valley. She graced magazine covers, rubbed elbows with VIPs, and became known for her Steve Jobs-like signature black turtleneck.

In his summary of Holmes’ 2016 presentation at the annual meeting of the American Association of Clinical Chemistry (AACC), titled, “After AACC Presentation, Elizabeth Holmes and Theranos Failed to Convince Clinical Laboratory Scientists and the News Media about Quality of Its Technology,” Robert Michel, Editor-in-Chief of Dark Daily and its sister publication The Dark Report, wrote, “It would be safe to summarize most reactions as skeptical.”

Holmes’ presentation, Michel noted, was met with suspicion as her credibility with the media and clinical laboratory scientists eroded. “Holmes did not fool many in the audience.”

One clinical chemist who attended the AACC meeting said, “I came to see scientific data about this remarkable technology that could do up to 70 medical laboratory tests on a single drop of capillary blood. Instead, I heard her talk about the new corporate strategy at Theranos, including the details as to how their analyzer works. The data that followed had nothing to do with anything but their new analyzer.”

Prosecutors Claim Fraud Paid for Holmes’ Extravagant Lifestyle

Holmes’ celebrity status helped fuel Theranos’ rapid valuation growth, which reached a high of $10 billion in 2015. But her gold-plated lifestyle became a point of contention during the recent pre-trial hearing. Prosecutors maintained that Theranos’ fraud propelled Holmes’ extravagant spending.

“In addition to her salary, the company provided for her luxurious travel on private jets and expensive lodging,” Assistant US Attorney John Bostic told CNBC. “The point here is the so-called success of Theranos was entirely the product of fraud.”

But according to CNBC, the judge “pushed back” on the government’s argument, stating Holmes’ benefits likely were on par with other CEOs. “What’s the value that she’s at the Four Seasons or a Motel 6?” the judge asked the prosecutors.

CNBC reported the two sides also sparred over whether jurors will learn about Holmes’ private text messages and regulatory reports.

Holmes and former Theranos President and Chief Operating Officer Ramesh Balwani have both pleaded not guilty. Balwani will face a separate trial after Holmes’ court case concludes.

Clinical laboratory scientists will watch with interest as the Holmes and Balwani trials finally get under way, since the accuracy of Theranos’ blood tests will be under the microscope along with Holmes’ participation in the alleged fraud.

Andrea Downing Peck

Related Information:

Elizabeth Holmes Makes First Courtroom Appearance in Over a Year

Hot Startup Theranos Has Struggled with its Blood-Test Technology

Elizabeth Holmes Lavish Lifestyle Looms over Theranos Fraud Case

Accuracy of Theranos Blood Tests at Heart of Elizabeth Holmes’ Criminal Case

Elizabeth Holmes Reappears in Court for First Time in 15 Months Putting Silicon Valley Culture Under Scrutiny

After AACC Presentation, Elizabeth Holmes and Theranos Failed to Convince Clinical Laboratory Scientists and the News Media about Quality of its TechnologyFederal Prosecutors Add a 12th Felony Fraud Charge in Latest Criminal Indictment Against Theranos Founder Elizabeth Holmes

Community Anatomic Pathology Groups Show Increased Interest in Adopting Digital Pathology and Whole-Slide Imaging, But Can They Do It on a Budget?

Acceptance of digital pathology and whole-slide imaging is now almost universal among academic health center pathology departments and the nation’s largest pathology companies

Across the United States, many private practice anatomic pathology groups now recognize that digital pathology is the path forward for the entire profession. During the past decade, most academic pathology departments and large pathology lab companies have incorporated digital pathology (DP) and whole-slide imaging (WSI) into many of their labs’ daily activities.

However, in community hospital-based anatomic pathology groups, there have been barriers to even the partial adoption of digital pathology. The two biggest barriers are well-known and discussed frequently at conferences and in the literature.

Some Pathologists Reluctant to Give Up Light Microscopes

One recognized barrier to wider adoption of DP is the reluctance of many long-serving pathologists to give up their familiar light microscopes and glass slides so they can make the transition to reading pathology images on a computer screen. These pathologists remain loyal to the tools and workflows that have served them well throughout their careers.

They generally oppose their group’s move to digital pathology when the subject is discussed in partner meetings and strategic retreats. Since many pathology groups require 100% of partners or shareholders to approve major business decisions, even one recalcitrant and stubborn pathologist-partner can block the motion to adopt digital pathology that is supported by most partners.

The second barrier is the fully-loaded cost to acquire, validate, implement, and use a digital pathology system with whole-slide imaging. A full-featured scanner can cost $250,000 or more and acquiring all the software, systems, and tools needed by a group to fully incorporate digital pathology into daily workflow can easily total $500,000 to $1,000,000.

This substantial commitment of a pathology group’s capital can trigger the same intense debates as the original question of whether the pathologists in the group should adopt DP and WSI. And, not surprisingly, in most pathology groups the same dynamics come into play when votes are tallied on the motion for the pathology group to commit the funds necessary to acquire a digital pathology system, the scanners, and associated tools.

Just one or two partner holdouts can block the decision to spend the money, despite that most of the pathologist partners are ready to make the commitment.

More Community Pathology Groups Considering Digital Pathology

Yet, the momentum in favor of adopting DP and WSI continues to build. “Those pathology labs that are early adopters report multiple clinical and financial benefits. These can include generating positive financial outcomes—including the ability to attract new clients, increasing case referrals, and generating new sources of revenue to the group. In turn, the increased revenue can allow the group to increase pathologist compensation,” said Robert L. Michel, Editor-in-Chief of Dark Daily and its sister publication The Dark Report.

Every day, more anatomic pathologists in the United States use a digital pathology system with a workstation (like above) to view whole-slide images and manage their daily caseload. Most academic center pathology departments use digital pathology, as do many of the nation’s largest pathology lab companies. (Photo copyright: WizardHealth.)

“We are in a time when health insurers are hammering away at the reimbursement paid to anatomic pathologists,” Michel continued. “Year after year, payers cut reimbursement for technical component and professional component services. They exclude many pathology groups from payer networks. That is why more community pathology groups are recognizing several important benefits with the use of DP and WSI that can increase a pathology group’s revenue and boost its pathologist compensation.

Community Pathology Groups Can Use Digital Pathology to Add Value

Equally important, there are specific ways that digital pathology and whole-slide imaging increase the value of the clinical services pathologists deliver to their client physicians. These dual benefits of DP are often overlooked—or not discussed—when community pathology groups conduct their annual retreats and debate the key points of when to adopt—and how to fund—a digital pathology system for their group. These benefits range from giving physicians a faster diagnostic answer on their cancer cases to helping the group’s subspecialist pathologists get more case referrals from physicians in other states.

“It’s important for all surgical pathologists to recognize several realities in today’s pathology marketplace,” Michel noted. “First, almost every sector in healthcare is digitizing itself. Reinforcing this trend is the federal government’s mandates for interoperability across EHRs, HISs, and LISs. Any private pathology group practice that lags in its adoption of digital capabilities and digital images will find itself falling farther and farther behind as physicians switch their case referrals to other pathology labs that have converted to digital pathology and whole-slide images.

“Second, pathology groups that adopt DP and WSI put themselves in a position to build market share in their service region, while at the same time increasing case referrals for their in-house subspecialist pathologists from throughout the United States,” Michel continued. “Also, when the histology is done locally, the local pathology group can deliver faster diagnostic answers and provide digital images as appropriate to referring physicians and hospitals in that region without the need to transport glass slides by couriers.

“Third—and this is an often-overlooked benefit of digital pathology—the local pathology group with DP and WSI can recruit today’s graduating pathology residents and fellows who have trained on DP and WSI. These new pathologists typically limit their job search to pathology groups that have gone digital,” Michel noted. “Millennial pathologists trained with digital images in their residency program. They are eager to work with the automated image analysis algorithms now coming to market.”

To help pathology groups better understand the opportunities and challenges associated with implementing digital pathology and whole-slide imaging, Dark Daily is presenting a special webinar, “Adopting Digital Pathology on a Budget: Getting Started, Knowing What’s Feasible, and Funding Your DP from Overlooked Sources,” on Thursday, May 27, from 1:00 PM to 2:30 EDT.

On Thursday, May 27, at 1:00 PM EDT, Keith Kaplan, MD, Chief Medical Officer of Corista (left), Andrew Evans, MD, Medical Director of Laboratory Medicine at Mackenzie Health (center left), William DeSalvo, President of Collaborative Advantage Consulting and Manager of Histology Operations at Sonora Quest Laboratories in Tempe, Ariz. (center right), and Lisa-Jean Clifford, COO and Chief Strategy Officer at Gestalt Diagnostics (right) will present “Adopting Digital Pathology on a Budget: Getting Started, Knowing What’s Feasible, and Funding Your DP from Overlooked Sources.” Anatomic pathologists, clinical laboratory directors, laboratory managers, clinical pathologists, and laboratory technicians will gain a critical understanding of which components a fully integrated digital pathology system requires, the differences between your lab’s existing LIS and a digital pathology system, budget-minded approaches to buying the components of a digital pathology system and implementing them in a stepwise fashion, and much more! (Photo copyright: Dark Daily.)

Recognizing the significant capital investment needed to acquire and deploy digital pathology and WSI, one goal of the webinar’s panel of experts is to identify ways that pathology groups can go digital on a budget. “We will do our best to identify different ways that pathology groups with limited financial resources can get into digital pathology,” said Keith Kaplan, MD, Chief Medical Officer at Corista in Concord, Mass., who will chair the upcoming webinar. “This may be the first public presentation where there is candid information about different financial strategies that your pathology group can utilize to acquire the scanners, the DP systems, and the associated tools needed for a full conversion to daily digital pathology.”

Don’t overlook how your participation in this webinar can be the foundation for helping your pathology group practice develop a timely, cost-effective path forward to introduce digital pathology and whole-slide imaging. Use of DP and WSI can become an important factor in helping your group offset payer prices cuts, develop new clients and sources of revenue, and increase pathologist compensation.

Click HERE to register today (or copy and paste this URL into your browser: https://www.darkdaily.com/webinar/adopting-digital-pathology-on-a-budget/). Make sure to have your pathology practice administrator and your histology manager join you for this important webinar.

—Michael McBride

Related Information:

Digital Pathology Launched in the ‘Era of COVID-19’: Memphis Lab Company Makes the Business Case for Scanning Slides to Cut Costs, Boost Productivity

Anatomic Pathology at the Tipping Point? The Economic Case for Adopting Digital Technology and AI Applications Now

Digital Pathology Systems Will Create Opportunities: Community Pathologists Discuss Benefits of Being Early Adopters of Digital Pathology

Even as Digital Pathology Is Poised to Be Disruptive in Primary Diagnosis, Most Anatomic Pathology Groups Are Unprepared for How Their Incomes Will Change

Twenty Years of Digital Pathology: An Overview of the Road Travelled, What Is on the Horizon, and the Emergence of Vendor-Neutral Archives

Next Generation Diagnostic Pathology: Use of Digital Pathology and Artificial Intelligence Tools to Augment a Pathological Diagnosis

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