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Sonic Healthcare Acquires Propath, while PathGroup Buys Pathology Consultants in More Signs of a Consolidating Market

An estimated 80 pathologists will now work for larger pathology superlabs as part of the deals, bringing stiffer competition to independent anatomic pathology groups

This story comes from the desk of The Dark Report. If you’re not a subscriber, sign up for a free trial and read exclusive insider content for laboratory directors and pathologists.

Consolidation among private practice anatomic pathology groups continues with news that two large regional pathology groups decided to sell to larger pathology companies. The first transaction announced was on Dec. 16, 2021, when Sonic Healthcare of Sydney, Australia, disclosed that it had acquired Dallas-based ProPath. Sales price and other terms were not announced. 

The second transaction happened last month. On Jan. 24, Nashville-based PathGroup announced it had bought Pathology Consultants of Greenville, S.C. Price and terms of this transaction also were not disclosed. 

Pathology Consolidation Continues

The decision by two of the nation’s leading regional pathology groups to sell themselves to larger pathology entities confirms that the trend of consolidation is continuing within the pathology profession. It is also a sign that smaller pathology groups will find it increasingly difficult to compete and stay profitable as new technologies transform the surgical pathology profession, such a digital pathology platforms.

ProPath was considered a financially strong regional super-group, as it operates facilities in three states and has 50 pathologists and 500 employees. Sonic noted that ProPath’s annual revenue was about $110 million. 

Sonic Healthcare has been a major acquirer of anatomic pathology practices in the United States. In early 2011, it purchased Physicians Automated Laboratory, and just six weeks earlier, acquired CBL Path for $123.5 million. 

Sonic Healthcare also purchased Aurora Diagnostics in 2018 for $540 million. That deal brought it 32 pathology practice sites and added 220 pathologists to its roster. 

With its acquisition of Pathology Consultants, PathGroup adds 30 pathologists and 100 employees. Prior to this acquisition, PathGroup said it had 225 pathologists. 

PathGroup CEO Ben Davis, MD

“We will continue providing highly specialized pathology expertise, as well as a broad range of clinical and molecular pathology services,” PathGroup CEO Ben Davis. MD, said of the Pathology Consultants acquisition. (Photo copyright: ProPath)

Maintaining Independence Gets Tougher

Anatomic pathologists will want to understand why two major regional pathology groups have decided to give up their independence and sell to a larger company. The reasons are several and include: 

  • Need for cash to purchase the equity of retiring baby boomer pathologist partners in the group. 
  • Challenges in recruiting new pathologists to the group. 
  • Need for capital to acquire digital pathology capabilities and other needed advanced diagnostic technologies.
  • Access to managed care contracts as private health plans continue to narrow their provider networks. 

It should be noted that graduating pathology residents and fellows are tech-savvy and want to work in practices that have all the latest technologies in histology, scanning, and digital pathology. This observation plays into the consolidation of the market.

Robert Michel

Related Information:

Sonic Healthcare Acquires ProPath, a Texas-Based AP Company

PathGroup Acquires Pathology Consultants, Continuing Expansion Across the Southeastern United States

Attention All Surgical Pathologists: Algorithms for Automated Primary Diagnosis of Digital Pathology Images Likely to Gain Regulatory Clearance in Near Future

Sonic Healthcare Buys California Clinical Pathology Laboratory Company

Six Practices for Effective Managed Care Contracting

Medscape Report on Physician Salaries in 2020 Shows Pathologists at Middle in Pay, but Near Top in Job Satisfaction

Though pathology salaries rank 16th among 29 medical specialties, it is in the top 10 among specialties that attract women and respondents say that comes with a lot of paperwork

Despite “hardships” brought on by the COVID-19 pandemic, 18,000 physicians in more than 29 medical specialties who participated in Medscape’s 2021 Physician Compensation Report said that, overall, their 2020 income was similar to prior years. Pathologists reported earnings in 2020 of $316,000, $28,000 below the average specialist’s salary of $344,000.

The average pathologist’s salary ranked 16th among medical specialty salaries.

Compared to 2019, medical specialists on average made $2,000 less in 2020. The average salary for primary care doctors was $242,000 in 2020, down $1,000 from 2019, according to a Medscape news release.

“Physicians experienced a challenging year on numerous fronts, including weathering the volatile financial impact of lockdowns,” said Leslie Kane, Senior Director, Medscape Business of Medicine, in the news release. “Our report shows that many were able to pivot to use telemedicine and focus on tactics that would protect their practices.”

Medscape, a health information provider that is part of the WebMD network, said that in addition to telehealth, doctors turned to MACRA (Medicare Access and CHIP Reauthorization Act of 2015) value-based payment reward programs and other strategies to minimize the effects of office closures last year.

“COVID took a terrible emotional toll on physicians and healthcare workers, and many are still struggling financially, but our findings showed that physicians will innovate and change quickly to meet the needs of patients through extremely difficult times,” said Leslie Kane (above), Senior Director, Medscape’s Business of Medicine, in the news release. Pathologists who were at the center of the nation’s COVID-19 pandemic response would likely echo her sentiments. (Photo copyright: Medscape.)

Pathology Salary Unchanged

To complete its study, Medscape asked physicians to take a 10-minute online survey. The reported findings included responses from 17,903 physicians (61% male, 36% female) practicing in more than 29 specialties between October 2020 and February 2021.

Pathologists who participated in the survey reported no change in their annual salary since 2019. Other specialties that reported no salary change include:

  • Family medicine,
  • Infectious diseases,
  • Ophthalmology, and
  • Orthopedics/orthopedic surgery.

Top 10 Medical Specialty Salaries

Medscape’s report listed these top-10 medical specialties as earning the highest salaries (see the graphic below for the full list of medical specialties surveyed):

Specialist Salary Increases and Decreases

Contrary to what many specialists reported, plastic surgeons did not experience slowdowns in appointments during the COVID-19 pandemic. In fact, not only did plastic surgeons earn the most, at 10% they are the medical specialists who got the biggest increase in pay of previous years as well.

According to the American Academy of Facial Plastic and Reconstructive Surgery (AAFPRS), which conducted its own salary survey of its member surgeons, “70% of AAFPRS surgeons report an increase in bookings and treatments over the course of the COVID-19 pandemic, with nine in 10 facial plastic surgeons indicating an increase of more than 10%. Surgical procedures are the most common procedures as part of this upsurge, perhaps cancelling out any decreases that might have resulted from the economic crisis and lockdowns.”

Other specialist salaries which Medscape found increased in 2020 include:

  • Oncology: up 7%
  • Rheumatology and cardiology: up 5%
  • Diabetes/endocrinology: up 4%
  • Neurology, critical care, psychiatry: up 3%
  • General surgery, urology, public health/preventive medicine: up 2%

Medical specialties that reported reductions in salary included:

  • Otolaryngology and allergy/immunology: down 9%
  • Pediatrics and anesthesiology: down 5%
  • Dermatology: down 4%
  • Pulmonary medicine, physical medicine, gastroenterology, and radiology: down 3%
  • Emergency medicine and internal medicine: down 1%

About 92% of physicians surveyed indicated that the COVID-19 pandemic caused their income to decline. Also, 22% of doctors noted they experienced loss of work hours.

Pathologists Received Low Average Bonuses

Reporting on receipt of incentive bonuses, Medscape ranked pathology in the bottom half of its list with $42,000 as an average bonus. The top incentive bonuses went to those practicing:

  • Orthopedics/orthopedics surgery: $116,000
  • Ophthalmology: $87,000
  • Otolaryngology: $72,000

About 59% of primary care physicians and 55% of specialists surveyed reported receiving an incentive bonus.

Pathologists Rank High in Job Satisfaction

In responding to a question about compensation, pathologists ranked near the top (seventh position) with 64% saying they are content with their pay. Others expressing salary satisfaction included:

  • Oncology: 79%
  • Psychiatry: 69%
  • Plastic surgery: 68%
  • Dermatology: 67%
  • Public health/preventive medicine: 66%
  • Radiology: 65%
  • Pathology: 64%

Pathology Popular Among Women MDs

Medscape found that women MDs chose certain medical specialties more often than others, including pathology, which ranked eighth. The top eight specialties employing female physicians are:

  • Pediatrics: 61%
  • Obstetrics/gynecology: 59%
  • Diabetes/endocrinology: 50%
  • Family medicine: 47%
  • Dermatology: 46%
  • Infectious diseases: 46%
  • Internal medicine: 44%
  • Pathology: 43%

Specialties with the fewest female physicians are:

  • Plastic and general surgery: 20%
  • Cardiology: 14%
  • Urology: 11%
  • Orthopedics/orthopedics surgery: 9%

Pathology a Leader in Paperwork

Medscape also surveyed physicians as to the estimated hours they spend per week on paperwork and administration. Here, pathology ranked the fifth highest with 19%, while radiologists and hospital-based physicians were third from the bottom with 11.6%.

Specialists that reported the highest hours spent on paperwork include:

  • Infectious diseases: 24%
  • Public health/preventive medicine: 20.7%
  • Nephrology: 19.8%
  • Internal medicine: 19.7%
  • Pathology: 19%

If They Could Do It Again, Most Would

Amid a trying year, the Medscape survey respondents made an encouraging point: 78% of them said they would choose medicine as a career again. And 85% of pathologists said they would choose the same specialty.

Medscape’s report may be helpful to hospital-based clinical laboratory leaders preparing salary budgets and to pathologists in salary negotiations and determining professional responsibilities.

—Donna Marie Pocius

Related Information:

Medscape Physician Compensation Report: The Recovery Begins 2021

Medscape Physician Compensation Report Shows Salaries Held Steady Despite Pandemic

A Pandemic of Dysmorphia: “Zooming” into the Perception of Our Appearance

AAFPRS Announces annual Survey Results, A Look at How COVID-19 Disrupted Facial Plastic Surgery

Hospital-based Clinical Laboratory Scientist is Suing Her Former Employer After Being Fired Due to Long-Haul COVID-19 Illness

Medical laboratory employee alleges healthcare system discriminated based on her medical condition, failed to accommodate her disability, then retaliated and created hostile working conditions

What is a clinical laboratory’s obligation when an employee is infected with the SARS-CoV-2 coronavirus and does not make a speedy recovery? Medical laboratory executives should ponder this question now that a California hospital system is being sued by a 33-year laboratory employee who was terminated after missing too many workdays due to “long-haul” COVID-19 illness.

According to court documents obtained by Dark Daily, clinical laboratory scientist (CLS) Kathleen Hamada filed a lawsuit March 22 in Fresno County Superior Court alleging Community Hospitals of Central California (parent company of Community Medical Centers in Fresno, Calif., where Hamada worked):

  • Discriminated based on her medical condition,
  • Failed to accommodate her disability,
  • Retaliated in violation of medical leave laws,
  • Created hostile working conditions, and
  • Wrongfully terminated her, among other charges.

Hamada’s attorney, Amanda Whitten JD of Bryant Whitten LLP in Fresno, told The Fresno Bee that “ [California] state law allows an employee to take up to 12 weeks of leave a year to deal with a serious medical condition,” and that, “It’s also illegal for an employer to retaliate against an employee for requesting and taking that leave.”

Michelle Von Tersch, Senior Vice President of Communications and Legislative Affairs at Community Medical Centers, told the Fresno Bee in a statement that she could not comment on the pending litigation. But she added, “During the COVID-19 pandemic, Community Medical Centers expanded employee assistance programs, including extended time off for employees to care for themselves and their loved ones.”

Community Medical Centers (CMC) is a not-for-profit healthcare system in the greater Fresno area. It operates four hospitals and a cancer institute, and several long-term care, outpatient, and other healthcare facilities. CMC has more than 8,800 employees, according to a hospital fact sheet.

Was Hamada Wrongfully Discharged?

The lawsuit states Hamada worked for Community Hospitals of Central California as a clinical laboratory scientist from July 1, 1987, until Oct. 13, 2020, when she was “wrongfully discharged.” In the filing, Hamada’s attorney noted that Hamada received “good performance reviews and salary increases and was not subject to discipline for her job performance” during her more than 30 years of employment.

After Hamada became sick with COVID-19 in mid-April 2020, she followed her doctor’s recommendation and went on medical leave for roughly six weeks. However, when she returned to work in June 2020, she “still suffered from the effects of the coronavirus” and was considered a “long-haul” COVID-19 patient, the lawsuit states. As a result, her healthcare provider suggested she request “intermittent medical leave” due to her continued illness and underlying medical conditions, including diabetes, cardio-pulmonary disease, and traumatic brain injury.

Plaintiff Alleges Threats and Intimidation

The lawsuit contends Hamada’s request for additional medical leave resulted in her supervisor telling her, “you better not” file the request. In addition to this threat, the plaintiff alleges she was shunned by her supervisor and coworkers and then subjected to discipline based on attendance when she was absent from work due to her medical condition. In October, she was terminated due to violating the “employer’s attendance policy,” the lawsuit states.

The complaint outlines eight causes of action:

  • Discrimination based on medical condition, disability, or perceived disability.
  • Failure to accommodate a disability.
  • Failure to prevent discrimination and discrimination based on medical condition, disability, or perceived disability.
  • Retaliation for requesting accommodation.
  • Retaliation for exercising rights under the California Family Rights Act.
  • Wrongful termination in violation of public policy.
  • Defamation.

The California Family Rights Act provides most employees in California with the right to take up to 12 weeks of leave from work to care for themselves or family members with a serious health condition or bond with a new child.

Hamada is requesting a jury award for:

  • general damages above the jurisdictional minimum of the Court,
  • special damages,
  • punitive damages,
  • interest on lost earnings,
  • deferred compensation and employee benefits,
  • reinstatement of her job, and
  • reimbursement of attorneys’ fees.

Should Long-Haul COVID-19 Be Considered a Disability?

David Fram, JD, Director of ADA services with the National Employment Law Institute (NELI) in Golden, Colo., told the Society for Human Resource Management (SHRM) that COVID-19 “long haulers” may have a “disability” as defined under Americans with Disabilities Act of 1990 (ADA), meaning employers would have to provide accommodations.

David-Fram-JD-at-event
In an article on the Society for Human Resource Management (SHRM) website, David Fram, JD (above), Director of ADA Services with the National Employment Law Institute (NELI), said, “If someone has COVID-19 for two weeks and there are no lingering effects, he or she still could be regarded as having a disability. While an employer doesn’t have to reasonably accommodate someone it merely regards as having a disability, it must refrain from discriminating against that person.” Additionally, he noted, “An employer must not discriminate against and must reasonably accommodate someone who has an impairment that substantially limits a major life activity, which could include a COVID-19 long hauler.” (Photo copyright: National Institutes of Health.)

Are Clinical Laboratories Legally Obligated?

In the same article, S. Leigh Jeter, JD, Senior Counsel with Michael Best and Friedrich in Chicago, said, “Unfortunately, there is no bright-line test for determining whether someone is disabled for purposes of the Act.” She added, “I encourage employers to err on the side of assuming that the employee may be covered under the ADA and then consider those resulting legal obligations.”

Removal of nonessential functions of the position might be a reasonable accommodation, Jeter noted.

According to court records, the case has been assigned to Superior Court Judge D. Tyler Tharpe. A case management conference has been scheduled for July 22 in the Fresno Superior Court.

Clinical laboratory executives would be wise to follow this COVID-19-related lawsuit closely and review their employment policies to better understand their obligation toward their workers under the Americans with Disabilities Act. This case may open the door to additional lawsuits related to COVID-19 firings.

Andrea Downing Peck

Related Information:

Kathleen Hamada vs. Community Hospitals of Central California

CV-48 Notice of Case Management Conference and Assignment of Judge for All Purposes

Fresno Lab Worker Who Had Long-Term COVID Is Suing Hospital, Says She Was Fired for Illness

Comply with ADA, FMLA When Worker Is a ‘COVID-19 Long Hauler’

University of Vermont Microbiology Laboratory Identifies Inefficiencies When Performing Pooled Testing for COVID-19

The key to success with pooled testing, says the lab’s director, is having the right personnel and equipment, and an LIS that supports the added steps

Experts believe pooled testing for COVID-19 could reduce the number of standard tests for SARS-CoV-2 by conserving testing resources and cutting lab spending on tests and testing supplies. However, some clinical laboratories have found pooled testing causes inefficiencies due to the lab’s lack of staff, limitations of existing equipment, and biosafety hood space, as well as not having a laboratory information system (LIS) that can manage the large volume of specimens and retesting involved in pooled testing.

One such example is the microbiology lab at 562-bed University of Vermont Medical Center (UVMC) in Burlington, Vt. After evaluating the pooled-testing method, Christina M. Wojewoda, MD, pathologist, Director of Clinical Microbiology at UVMC and an Associate Professor at the Larner College of Medicine at University of Vermont, decided last summer not to do pooled testing, due to the manual steps that the process requires.

The manual steps include having clinical laboratory scientists work under protective hoods to limit the virus’ spread, and both hood space and med techs are in short supply at UVMC, she explained during an exclusive interview with The Dark Report, Dark Daily’s sister publication.

“Our evaluation then is the same as it is now,” she commented. “The barriers to pooling still hold true. Instead of pooling, we keep up with the volume of COVID-19 samples by balancing in-house SARS-CoV-2 testing and send-out testing.”

Low Viral Load a Problem in Pooled Testing for SARS-CoV-2

Another problem, Wojewoda added, is when one patient’s sample in a pool of specimens has a low viral load of SARS-CoV-2. Clinical labs in some states have found that when the prevalence of the novel coronavirus in the population is below 5%, then pooled testing could be an effective testing strategy. However, although Vermont has a relatively low presence of the COVID-19 virus in the population, Wojewoda remains concerned about the viral load in a pooled sample.

“For us, it is less of an issue with prevalence in the population than an issue with low viral load in one patient sample, and that can happen with any prevalence level,” she said. “If there is a low level of virus in one sample, and that sample is combined with samples from four other patients to create the pool, you could dilute the virus below the assay’s level of detection. That means you could miss low-level positive patients.

“When we first considered pooling, we worried about missing those patients, but since then we’ve learned more about the SARS-CoV-2 virus,” she continued. “Now, we now know that patients start producing high levels of virus quickly and that low virus levels often occur toward the end of their infection, after they’ve probably been tested or identified.

“That means we’re less concerned with low levels of virus now than we were initially, at least when pooling five specimens in one tube. But it’s still something to watch for,” she noted.

What About Too Much Virus?

The opposite of this problem also is a concern. If the incidence of infection is too high in a population, then pooled testing could produce too many positive results. The required retesting then makes the process inefficient.

Wojewoda has heard similar concerns from her colleagues at other medical laboratories. They said they were not doing pooled SARS-CoV-2 testing for some of the same reasons.

“When we looked into pooled testing, a number of complications made it impractical,” she said. “Instead, we have been testing each patient individually.”

Since the spring, UVMC’s microbiology lab has run 200 to 500 molecular COVID-19 tests per day on two Hologic Panther instruments and has run a laboratory-developed test (LDT) from the federal Centers for Disease Control and Prevention (CDC) on the ABI 7500 from Applied Biosystems of Waltham, Mass., a Thermo Fisher Scientific (NYSE:TMO) company.

When patient COVID-19 samples exceed 500 in a day, UVMC sends those specimens to the Broad Institute in Cambridge, Mass., for testing.

During the summer, the rate of COVID-19 infections in Vermont was at about 1%, Wojewoda noted. In the last week of December, the Vermont Department of Health reported the seven-day average percentage of positive tests was 2.2%.

Laboratory Information System Challenges When Doing Pooled Testing

In addition to her concerns about the level of detection, UVMC’s laboratory information system (LIS) was another worry. “Clinical laboratories are designed to test one sample and get one result, and that one result goes into one patient’s chart,” she explained. “But when the lab makes a pool of, say, five patients’ samples, those five results need to go into five patients’ charts.

Wojewoda estimates that manual data entry for each of those results takes a solid minute per sample. “That’s not a lot, but it adds up over time, and it’s not something we do normally.”

Normally, lab test results get filed automatically into the patient’s chart, and then those results are available to patients online, she noted.

“There may be multiple fixes for this problem of accurately and efficiently getting pooled test results into the LIS, then reported to each individual patient, but for us the current state of our computer system requires that we enter each result into each patient’s chart manually. We try not to do that as much as possible because of the potential for errors from manual entry,” she said.

When Automation Falls Short

In addition, Wojewoda said that pooled testing cannot be automated the way most standard clinical laboratory tests are run.

“With routine testing, we put a sample on the instrument and let the test run,” she explained. “When we get the result, it goes into the patient’s chart. But, for pooled testing, we have to collect five samples and then pause to manually put a little bit of each of those five samples into one tube. Then, we put that tube on the instrument.

“After we get the results, we manually report the negative results into each patient’s chart,” she continued. “But if they’re positive, then lab staff must find the five tubes and test each one individually. Therefore, we’re doubling the time it normally takes to produce and report a positive result for SARS-CoV-2.”

Any positive results in a pooled sample, she explained, are held up at the instrument so that the lab staff can pull those five samples from the pool and test each one individually. “Then those individual results go into each patient’s chart, because potentially only one of the five might be positive. We don’t want all five of those patients to be labeled as positive if only one is positive,” she added.

UVMC lab Director Christina M. Wojewoda, MD
Pooled testing for COVID-19 adds a layer of complexity that the UVMC lab does not normally do, noted the lab’s Director Christina M. Wojewoda, MD (above), a pathologist and Director of Clinical Microbiology at the University of Vermont Medical Center (UVMC) in Burlington, in an interview with The Dark Report. She added that the lab’s staff is already stretched thin and doing as much as possible. “In all these ways, pooled testing is different from how we usually run clinical lab tests. It’s clear that the idea behind pooled testing is to improve efficiency, and yet the need for manual data entry and pulling pooled samples apart create inefficiencies,” she commented. (Photo copyright: University of Vermont.)

Shortage of Lab Techs and Hood Space Compound Inefficiencies of Pooled Testing

Another problem is the requirement to pipette each specimen, she noted. “All infectious samples require hood space and a lab technician to do the work under the hood. But both hood space and lab techs are in short supply.”

Wojewoda explained that some tests being run at the UVMC lab are not being tested from the primary tube.

“There’s often a step where we take some of the primary sample and put it into a tube or cartridge for the test. Then, we put multiple samples together, and we have to pipette each one into the tube without cross contaminating the other samples,” she explained.

“At the same time, we have to track the five patient samples so that we can find the original specimen for testing if we need to do so later. All those steps take more staff time.

“So, while pooled testing saves reagents, it also takes more staff time for pipetting and data entry and the need to record which samples are in which tubes,” she noted. “That might require a spreadsheet or other electronic means to track which samples come from which patients.

“An automated way to do the pipetting would be helpful and would increase staff safety,” she added. “I worry when we’re working with something as infectious as SARS-CoV-2, because the lab techs must dig swabs out of liquid media before discarding them, while being careful not to contaminate anything around them.”

Pooled testing for COVID-19 clearly has potential. But, as Wojewoda explained, it brings complications that can cause inefficiencies. Clinical laboratory managers will want to evaluate existing instrumentation, automation, staffing, and laboratory informatics capabilities to determine if and how their labs would experience similar inefficiencies before a final decision to begin a program of pooled testing for COVID-19.

—Joe Burns

Related Information:

Is COVID-19 Pooled Testing Good for Labs, Bad for IVDs?

Officials Differ on Value of COVID-19 Pooled Testing

Memphis Path Lab Pivots to COVID, Pooled Testing

NY Hospital Lab Succeeds with Pooled COVID-19 Testing

Healthcare Companies and Health Systems Continue to Grow Through Mergers and Acquisitions Despite COVID-19 Pandemic

Consolidation of hospitals and health systems means consolidated medical laboratory services as well, and that impacts laboratory revenue and staff

Though COVID-19 shifted many healthcare systems’ priorities in 2020—including quite dramatically altering the priorities of the nation’s clinical laboratories—the SARS-CoV-2 pandemic does not appear to have slowed the pace of healthcare mergers and acquisitions. Many such deals are kept secret until closed by Dec. 31. They are then then announced after Jan. 1, so we may see additional big and surprising healthcare acquisitions announced in coming weeks.

Leaving aside the shock waves brought about by COVID-19, transformational changes to the healthcare community have been underway for a while.

In his article on HealthManagement.org, healthcare consultant Paul D. Vitale, MPA, FACHE, noted that for the past several years, health systems have set records in the mergers and acquisitions space. In 2017, he noted, there were more than 115 deals, and by 2019, there was a series of “mega” mergers, each worth more than $10 billion. The pattern continued in 2020, even with economic concerns brought about by the pandemic.

“According to many health systems, acquiring another organization, or merging with it, holds the key to future success. Faced with intense pressure to cut back on costs, mergers and acquisitions can leverage the economies of scale,” he wrote.

Below are several “deals” that closed in 2020 or are expected to close in 2021.

Atrium Health and Wake Forest Baptist

North Carolina’s Atrium Health and Wake Forest Baptist Health—including the Wake Forest School of Medicine—have completed a merger, Healthcare Finance News reported. The resulting organization will be called Atrium Health and Eugene A. Woods, President and CEO of Atrium Health, will head the combined enterprise.

Pre-merger, Atrium Health’s network included 41 hospitals and 900 care locations, while the Wake Forest Baptist Health system was comprised of 42 hospitals and 1,500 care locations. Plans are underway to build a second campus for the school of medicine, where 3,500 students will be trained in more than 100 specialized programs.

Julie Ann Freischlag, MD, CEO of Wake Forest Baptist Health and Dean of Wake Forest School of Medicine
“The impact of the strategic combination will be far-reaching, elevating North Carolina as a clear destination of choice to receive medical care for people all across the nation,” Julie Ann Freischlag, MD (above), CEO of Wake Forest Baptist Health and Dean of Wake Forest School of Medicine, told Healthcare Finance News. “Through our combined, nationally recognized clinical centers of excellence in multiple specialties, we will be able to expand our research in signature areas, such as cancer, cardiovascular, regenerative medicine and aging, and target bringing research breakthroughs to the community in less than half the time of the national average.” Freischlag will serve as Atrium Health’s Chief Academic Officer as well. (Photo copyright: Triad Business Journal.)

Doctors Acquire a Controlling Stake of Steward Health Care

In June, physicians in Dallas purchased a controlling stake of Steward Health Care through a structured recapitalization transaction. Though not strictly a merger and acquisition, the deal represents a similar transformational change of a health system. The change makes Steward the largest physician-owned-and-operated health system in the country, noted a news release.

Ralph de la Torre, MD, CEO and founder of Steward
Ralph de la Torre, MD (above), CEO and founder of Steward, says the industry is in the midst of a transformational moment. “The COVID-19 global pandemic has exposed serious deficiencies in the world’s healthcare systems, with a disproportionate impact on underserved communities and populations,” he stated in the news release. “We believe that future healthcare management must completely integrate long-term clinical needs with investments. As physicians first, we will focus on creating structures and timelines that meet the long-term clinical needs of our communities and the short-term needs of our patients.” (Photo copyright: The Boston Globe.)

Harrington Healthcare System and UMass Memorial Health Care

In January 2020, Harrington Healthcare of Massachusetts announced it was pursuing a corporate affiliation with UMass Memorial Health Care. The transaction was expected to be finalized by 2021.

Ed Moore, President and CEO of Harrington Healthcare
“When we entered into our initial agreement with UMass Memorial in January, we had no idea what the next several months would bring,” said Ed Moore (above), President and CEO of Harrington Healthcare, in a news release. “Our team performed exceptionally well, and the community supported us every step of the way, but we could not have provided the outstanding care we did without the partnership and support of the clinical team at UMass Memorial. This experience redoubled our confidence that becoming part of the system would offer maximum benefit to our community at a time that requires flexibility, scale, and resources.” (Photo copyright: Worcester Telegram.)

Will More Announcements Come in 2021? Probably

For clinical laboratory managers and pathologists, the healthcare mergers and acquisitions of greatest interest are those that involve hospitals and health systems. When two big health systems merge—such as the transaction involving Atrium Health and Wake Forest Baptist Health—one of the first clinical services to undergo rationalization and consolidation is the clinical laboratory. One reason for this is because it is much easier to move more lab test specimens around the system than it is to move patients. So, many healthcare merger and acquisition deals directly affect the medical laboratory professionals employed by the institutions involved in the transaction.

Despite the pandemic—or because of the financial stresses created by it—there continue to be strong buyers and financially-weak sellers. For this reason alone, pathologists and clinical laboratory administrators should expect to see a regular flow of merger or acquisition announcements involving major healthcare organizations during 2021.

—Dava Stewart

Related Information:

Healthcare Mergers and Acquisitions—Making Waves in 2020

Atrium Health and Wake Forest Baptist Health Complete Merger

Team of Steward Doctors Acquire Controlling Stake of Steward Health Care

Harrington HealthCare System and UMass Memorial Health Care Approve Definitive Terms for Corporate Affiliation

10 Major Healthcare Merger and Acquisition Deals Announced in 2020

Critical Shortages of Supplies and Qualified Personnel During the COVID-19 Pandemic is Taking a Toll on the Nation’s Clinical Laboratories says CAP

As demand for SARS-CoV-2 coronavirus testing increases, leaders of the College of American Pathologists meet online to brainstorm possible solutions to the crisis

In September, the College of American Pathologists (CAP) began its series of “virtual media briefings” given by leading pathologists and physicians at the forefront of COVID-19 testing which are designed to “offer insights and straight talk” on the crisis confronting today’s clinical laboratories.

During the third virtual meeting on December 9, presenters discussed how the ever-increasing demand for COVID-19 testing has placed an enormous amount of stress on clinical laboratories, medical technologists (MTs), and clinical laboratory scientists (CLSs) responsible for processing the high volume of SARS-CoV-2 tests, and on the supply chains medical laboratories depend on to receive and maintain adequate supplies of testing materials.

The CAP virtual meetings, collectively titled, “The Rapidly Changing COVID-19 Testing Landscape: Where We Are/Where We Are Going,” are available for viewing on YouTube and Facebook.

Critical Supply Chain Deficiencies Hamstring Nation’s Clinical Laboratories

“As soon as we get one set of supplies, then it’s another set of supplies that we can’t get our hands on,” said Christine Wojewoda, MD, Clinical Pathologist and Associate Professor at the University of Vermont Medical Center, during the third CAP virtual briefing. “Right now, we’re very concerned that our lab can’t get pipette tips that have a certain filter in them to transfer patient samples into the tubes that we need, or the plates that we need to do the testing. If we can’t get the patient sample into where it needs to go, safely, without contaminating other patient samples, that’s a big issue.” 

Other members of the CAP panel concurred with Wojewoda and indicated that their clinical labs also are encountering supply chain challenges.

“It’s a daily battle,” said Amy Karger, MD, PhD, Clinical Pathologist and Associate Professor at University of Minnesota Physicians. “One of our managers spends hours a day making sure our lab has enough supplies, plastics, and chemicals to do the testing that we want to do. And he is often having to look for alternative solutions for COVID-19 testing, making phone calls, trying to find alternative products, and so we have a consistent worry about that.”

A June survey of CAP-accredited laboratories for COVID-19 testing found that more than 60% of lab directors reported difficulties in procuring critical supplies needed to conduct COVID-19 testing. The respondents indicated they encountered substantial barriers to obtaining equipment needed for SARS-CoV-2 testing—particularly test kits (69%), swabs (66%), and transport media (62%).

Staff Burnout and Shortages at Many Medical Laboratories

Karger also indicated that she is concerned about staff burnout and the toll the workload is taking on medical technologists at her laboratory. 

“Lab staff have been working full throttle since March. I think that is often lost on people. They kind of assumed that when cases were low with COVID-19, that maybe the lab staff got a break. Well, that wasn’t the case,” she stated, adding, “They [the medical technologists] were planning for this surge that we’re experiencing now and have been working often seven days a week, double shifts to get us to this point of high testing capacity [to respond to the demand for COVID-19 testing].” 

Another member of the CAP panel echoed Karger’s concerns.

“We worry about that as well,” said Patrick Godbey, MD, Founder and Laboratory Director at Southeastern Pathology Associates and current CAP President. “This demand for COVID-19 testing has made an already bad situation worse because there’s an absolute shortage of medical laboratory personnel and the increased demands on clinical labs have made this shortage even more acute.” 

Almost all of the surveyed CAP-accredited laboratories reported losses in revenue and financial stress since the pandemic started. But few had applied for any of the available funds offered through federal assistance programs. The survey found that the top issues among pathologists reported by laboratory directors were:

  • reduced work hours (72%),
  • reductions in pay (41%),
  • increased burnout (21%), and
  • increased work hours (20%).

According to the survey, the top stresses affecting non-pathologist professionals working in clinical labs were:

  • reduced work hours (69%),
  • reduced staff capacity (36%),
  • temporary furloughs (34%), and
  • increased burnout (31%).

‘An Overwhelming Sense of Doom’

Of course, clinical laboratory managers have been dealing with dwindling availability of qualified personnel for years, as one medical technologist training program after another closed and the supply of MTs and CLSs tightened. Dark Daily’s sister publication The Dark Report covered this trend as far back as 2012. (See, “GHSU Graduates Med Techs Using Distance Training: Medical Laboratory Scientist training program helps laboratories to recruit and to train MLSs.)

The diminishing labor pool trained for COVID-19 testing—coupled with high stress/burnout among existing staff—is a major impediment to ongoing expansion in the daily number of molecular COVID-19 tests that can be performed by the nation’s labs.

Also, the already-tight supply of med techs means many metropolitan area labs—particularly hospital labs—are operating with just 75% of the number of staff they are authorized to hire, because there are no techs available. Thus, existing staff are working lots of overtime, and vacant FTE positions are being temporarily filled by MTs placed by employment agencies.

A New York Times (NYT) article in December, titled, “‘Nobody Sees Us’: Testing-Lab Workers Strain Under Demand,” revealed that testing teams across the country are dealing with “burnout, repetitive-stress injuries, and an overwhelming sense of doom.” The article reported on the shortages of supplies needed to perform testing and states there is a “dearth of human power” in the field of pathology as well.

The supply of MTs and CLSs, molecular PhDs, clinical pathologists, MLTs, and other laboratory scientists available to work in the nation’s labs is finite and training programs take years to produce qualified workers to perform laboratory testing. 

Karissa Culbreath, PhD, Scientific Director, Infectious Diseases at TriCore Reference Laboratories
In the NYT article, microbiologist Karissa Culbreath, PhD (above), Scientific Director, Infectious Diseases at TriCore Reference Laboratories, and Assistant Professor of Pathology at the University of New Mexico, said that when shortages arise, “there are workarounds for almost everything else, but people are irreplaceable.” In addition to the large volume of COVID-19 tests that labs are expected to perform, they also must keep up with the other tests that are sent to them for analysis. Some facilities are even transitioning to 24/7 testing to keep up with the demand. “Labs are trying to maintain our standard of operation with everything else, with a pandemic on top of it,” said Culbreath. (Photo copyright: KOB 4/NBC.)

Should Clinical Lab Workers Be First to Receive the COVID-19 Vaccine?

In the third CAP virtual media briefing, the panel suggested that medical laboratory workers should be among the first to receive the COVID-19 vaccine.

“They are encountering and handling thousands of samples that have active live virus in them,” Karger said. “We are getting 10,000 samples a day [for SARS-CoV-2 testing]. That’s a lot of handling of infectious specimens and we do want them to be prioritized for vaccination.”

She added, “From an operational standpoint, we need to keep our lab up and running. We don’t want to have staff out such that we would have to decrease our SARS-CoV-2 testing capacity, which would have widespread impact on our health system and our state.”

Since the pandemic began nearly a year ago, there have been more than 18 million cases of COVID-19 confirmed in the US and more than 300,000 people have died from the virus, according to data from the federal Centers for Disease Control and Prevention (CDC).

And, as we move into flu season, the number of new COVID-19 cases is reportedly increasing, which adds more stress to clinical laboratories and their supply chains. As this is unlikely to end anytime soon, clinical lab managers must find new ways to do more with less.  

—JP Schlingman

Related Information:

The Rapidly Changing COVID-19 Testing Landscape: Where We Are/Where We Are Going

‘Nobody Sees Us’: Testing-Lab Workers Strain Under Demand

Clinical Laboratory COVID-19 Response Call

Pathologists Explore COVID-19 Testing Challenges, Breakthroughs

Labs Brace for Impact of Infection, COVID-19 Testing Surge as Thanksgiving Looms

Help Wanted at COVID-19 Testing Labs

Pathologists Want First Crack at COVID Vaccines

Clinical Laboratories Need Creative Staffing Strategies to Keep and Attract Hard-to-Find Medical Technologists, as Demand for COVID-19 Testing Increases

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