Genomics experts say this is a sign that clinical laboratory genetics testing is maturing into a powerful tool for population health
Faced with lagging sales and employee layoffs, genomics companies in the genealogy DNA testing market are shifting their focus to the healthcare aspects of the consumer genomics data they’ve compiled and aggregated.
Recent analysis of the sales of genetic tests from Ancestry and 23andMe show the market is definitely cooling, and the analysts speculate that—independent of the consequences of the COVID-19 pandemic on consumer behavior—the two clinical laboratory genetic testing companies may already have done testing for the majority of consumers who want to buy these tests.
“I think the consumer market is going to become more integrated into the healthcare experience,” Joe Grzymski, PhD, told GenomeWeb. “Whether that occurs through your primary care doctor, your large integrated health network, or your payor, I think there will be profound changes in society’s tolerance for using genetics for prevention.”
In February, Ancestry, the largest company in the home DNA testing space, announced it was laying off 6% of its workforce or approximately 100 people, across different departments due to a decline in sales, CNBC reported. Several weeks earlier, 23andMe, the second largest company in this market, also announced it was laying off about 100 people or 14% of its workforce due to declining sales.
“I wasn’t surprised by the news,” said Linda Avey, a 23andMe co-founder who is now co-founder and Chief Executive Officer at Precisely Inc., a genomics company headquartered in San Francisco. She was commenting to GenomeWeb on the recent restructuring at her former company. “The level of expensive advertising has been insane here in the US. Those [customer acquisition costs] are not a sustainable model.”
CNBC surmised that the lull in at-home genetic testing is due mainly to:
A drought of early adopters. Individuals who were interested in the testing for genealogical and health reasons, and who believed in the value of the tests, have already purchased the product.
Privacy concerns. Some potential customers may have reservations about having their DNA information collected and stored in a database due to concerns about how that data is safeguarded and its potential uses by outside companies, law enforcement, and governments.
COVID-19 May or May Not Be a Factor in Declining DNA Testing Sales
The COVID-19 pandemic may be playing a role in the decline in sales of at-home DNA testing kits. However, there are indications that the market was cooling before the virus occurred.
An article in MIT Technology Review reported that 26 million people had purchased at-home DNA testing kits by the beginning of 2019. The article also estimated that if the market continued at that pace, 100 million people were expected to purchase the tests by the end of 2020.
However, data released by research firm Second Measure, a company that analyzes credit and debit card purchases, may show a different story, reported Vox. The data showed a general decline in test kit sales in 2019. Ancestry’s sales were down 38% and 23andMe’s sales were down 54% in November 2019 compared to November 2018. The downward trend continued in December with Ancestry sales declining 15% and 23andMe sales declining 48% when compared to December 2018.
Second Measure, however, compiled data from the two companies’ websites only. They did not include testing kits that may have been purchased through other sources such as Amazon, or at brick and mortar locations.
Nevertheless, the measures being taken by genomics companies to shore up their market indicates the Second Measure data is accurate or very close.
Rise of Population-level Genomics
This decline in genealogical sales seems to be behind DNA-testing companies shifting focus to the healthcare aspects of consumer genomics. Companies like 23andMe and Ancestry are looking into developing health reports based on their customers’ data that can ascertain an individual’s risk for certain health conditions, or how they may react to prescription medications.
“We are seeing the next wave of maturity of the genetics market,” Othman Laraki, co-founder and CEO of Color Genomics, told CNBC. “If expensive diagnostic testing was genomics’ equivalent of mainframe computers, direct to consumer ancestry genetics was the hobbyist use. While the early adopter wave is petering out, we are seeing the real market (the equivalent of a PC in every home and a phone in every pocket), which is population-level use of genetics, taking hold.” (Photo copyright: San Francisco Business Times.)
For some genomics companies like 23andMe, the at-home DNA testing market was never specifically about selling testing kits. Rather, these companies envisioned a market where consumers would pay to have their DNA analyzed to obtain data on their ancestry and health, and in turn the testing companies would sell the aggregated consumer data to other organizations, such as pharmaceutical companies.
“Remember that 23andMe was never in the consumer genomics business, they were in the data aggregation business,” Spencer Wells, PhD, founder and Executive Director of the Insitome Institute, a US-based 501(c)3 nonprofit think tank focused on key areas in the field of personal genomics, told GenomeWeb. “They created a database that should in principle allow them to do what they promised, which is to improve people’s health through genomic testing.”
Even with clinical laboratory testing currently focused on COVID-19 testing, there remains an opportunity to sequence large numbers of people through at-home DNA testing and then incorporate those findings into the practice of medicine. The hope is that sales will again accelerate once consumers feel there is a compelling need for the tests.
Pathologists and clinical laboratory managers will want to watch to see if the companies that grew big by selling ancestry and genealogy tests to consumers will start to send sales reps into physicians’ offices to offer genetic tests that would be useful in diagnosing and treating patients.
Two major clinical laboratory conferences reschedule, as the SARS-CoV-2 pandemic continues to disrupt long-planned events; Many labs are losing money as fewer patients visit physicians
This week, the ongoing Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2) pandemic was responsible for two important developments in the clinical laboratory industry. Both involved the rescheduling of major annual conferences. In both cases, conference organizers are placing different bets on when they think the COVID-19 outbreak, the illness caused by the SARS-CoV-2 coronavirus, will have passed and when they believe some semblance of normalcy will return to both social interaction and business activities.
On Monday, the American Association of Clinical Chemistry (AACC) announced that it would reschedule its 2020 AACC annual meeting and exhibition—originally scheduled for July 26-30, 2020, at McCormick Place in Chicago—to Dec. 13-17, 2020, also at McCormick Place.
On the same day, Dark Daily’s sister publication, The Dark Report, announced it had rescheduled the 25th annual Executive War College on Laboratory and Pathology Management to new dates and to a new hotel. This conference will now take place on July 14-15, 2020, at the Hyatt Regency Hotel in New Orleans. This is a change from the originally scheduled date of April 28-29, 2020, and from the original location, the Sheraton New Orleans Hotel.
On its website, AACC stated: “Based on input from all stakeholder groups, and in close collaboration with host city officials, the organization is pleased to announce that AACC will be able to preserve the complete Annual Scientific Meeting and Clinical Lab Expo experience to which its members, exhibitors, and the entire laboratory medicine community have been looking forward. The 2020 AACC Annual Scientific Meeting and Clinical Lab Expo will now be held December 13-17, 2020, at McCormick Place in Chicago, IL, USA.”
Each conference claims to be “the largest” in some
dimension. Each year, AACC’s annual conference attracts more than 20,000
attendees, as measured by clinical chemists and other visitors to its Expo,
which features more than 750 lab companies.
While the Executive War College claims to be the largest conference serving the business, management, operations, and financial health needs of clinical laboratories and pathology groups. Each year, it hosts almost 900 attendees—generally senior administrators, lab executives, pathologist-business leaders, consultants, and in vitro diagnostics (IVD) manufacturers. The conference is supported by more than 50 corporate benefactors and sponsors.
AACC’s rescheduling of its conference from July to December
will delay two important activities:
Many lab scientists planning to attend were hoping to participate in the first assessments of the novel coronavirus pandemic, assuming that the pandemic had passed by mid-summer.
During AACC is when the nation’s major IVD manufacturers and companies that sell lab automation, instruments, test kits, reagents, and other products introduce their latest-generation solutions. Now, many of those product launches will be pushed back to December.
Meanwhile, organizers of the Executive War College are betting that the novel coronavirus pandemic will taper down, possibly synchronized with the end of the annual influenza season in North America, which is typically sometime in April or early May.
If this proves true, then conducting the conference on July 14-15, 2020, will give lab leaders the opportunity to gather and share lessons learned during this COVID-19 outbreak in time to prepare for a possible second outbreak of COVID-19 when the next influenza season arrives in the fall. It will also be an important opportunity for lab managers and pathologists to learn ways to restore revenue lost during the pandemic.
Clinical Laboratories, Pathology Groups, Hospitals, at
Brink of Financial Ruin
“What has gone unrecognized by the national news media is how the novel coronavirus pandemic is causing financial devastation to the finances of the nation’s clinical laboratories and anatomic pathology groups,” stated Robert L. Michel, Editor-in-Chief of The Dark Report and Founder of the Executive War College. “In absolute terms, the pandemic is a growing financial disaster to the medical lab industry, and it will take years for many labs to rebuild the staff that they have laid off or terminated in recent months in order to stay operational.
“Why are all labs losing money at this time?” asked Michel.
“The answer is simple—beginning early in March, patients stopped visiting their
doctors. Hospitals ceased to admit patients for elective procedures. Fewer
patients per day means fewer lab test referrals per day and loss of the revenue
generated by those claims that pays the salaries and expenses of the labs
performing those tests. Laying off or furloughing staff is one way labs lower
costs in response to lower income.
“Many clinical labs, pathology groups, and the hospitals
they serve are steadily approaching financial ruin,” he continued. “Every week
the pandemic continues, and North American citizens are advised to shelter in
place, forces labs to draw down their dwindling financial reserves to keep
their doors open.”
Robert Michel (above), Editor-in-Chief of The Dark Report and Dark Daily and Founder of The Dark Intelligence Group, will host the 25th anniversary Executive War College on Lab and Pathology Management on July 14-15, 2020, in New Orleans. Attendees from clinical laboratories and pathology groups will gain critical insights from such learning opportunities as: “Preparing Your Lab for a Second Outbreak of COVID-19,” and “Rapidly Building Cash Flow and Restoring Your Lab’s Financial Stability Post-Pandemic.” (Photo copyright: The Dark Report.)
This crisis has created three big questions that labs need
to answer:
How much longer will the COVID-19 pandemic last
before some degree of normalcy is restored (meaning patient office visits resume
and physicians begin ordering lab tests every day)?
If there is a second outbreak of SARS-CoV-2 this
fall, what does every lab need to know to be ready?
As American society and business return to
normal, how can labs quickly build up cash flow, collect more revenue, and
restore financial stability?
“Given the unknown aspects of the SARS-CoV-2 coronavirus,
the answer to the first question is a crap-shoot. But to reschedule the
Executive War College to dates that are 14 weeks away seems a reasonable bet,”
noted Michel. “The pay-off to that bet is the ability to provide the owners and
leaders of the nation’s labs answers to the second and third questions.
“The 14 weeks between now and mid-July give us the
opportunity to organize sessions and invite speakers who can provide answers
and information to help labs with their two most pressing needs: to be prepared
for another COVID-19 outbreak later this year, and to restore cash flow and
financial health as soon as possible,” said Michel. “This will be the very
first opportunity for lab managers and pathologists to assemble, learn the
COVID-19 lessons from successful labs, gain financial insights, and network
with their peers.”
The Executive War College team is inviting suggestions for
speakers and session topics for the July 14-15 conference. The original agenda
that was taking shape for the planned dates of April 28-29 will be revised so
as to include presentations now directly relevant to the state of the clinical
lab and pathology professions for mid-year 2020. Send your suggestions for
topics and speakers to info@darkreport.com.
Information on registering for the 25th annual Executive War College, and on placing reservations at the Hyatt Regency Hotel in New Orleans, is available on the EWC website (or copy and paste this URL in your browser: https://www.executivewarcollege.com.)
People already registered for Executive War College 2020
will have their registrations automatically applied to the new July 14-15
dates.
Bioeasy stands behind the accuracy of its coronavirus test kits and, in a statement, questioned whether they were being used correctly
How accurate are the SARS-CoV-2 test kits being offered by different in vitro diagnostics companies, as well as the internally-developed COVID-19 tests developed by individual medical laboratories, both here in the United States and in other countries? It’s a question that has not been addressed by the news media nor by healthcare regulators.
That
is why a recent news story reported complaints by authorities in several
European countries that COVID-19 tests they had purchased were “unreliable.”
The source of the COVID-19 test kits was a Chinese company.
On Wednesday, government officials in China announced that manufacturers of test kits for SARS-CoV-2, the novel coronavirus that causes the COVID-19 illness, can no longer export their tests unless China’s National Medical Products Administration (NMPA) has licensed and registered those tests, the South China Morning Post (SCMP) reported.
China issued the new rules after receiving complaints from buyers in Europe about the quality and accuracy of tests kits and other products, including personal protective equipment (PPE), ventilators, and infrared thermometers, SCMP wrote. Previously, Chinese exporters were required only to have CE certification to indicate that their goods conformed to the health and safety standards required for sale in the European Economic Area, SCMP added.
In a joint statement issued March 31, China’s Ministry of Commerce, General Administration of Customs (GAC), and the National Medical Products Administration said the new rule applies to all companies seeking to export test kits, face masks, protective clothing, ventilators, and infrared thermometers.
Spain
Discontinues Use of Rapid Diagnostic Tests from Bioeasy
The new rules came after health authorities in Spain stopped using a rapid diagnostic test (RDT) kit that required a nasopharyngeal (NP) swab to collect specimens to diagnose patients for the SARS-CoV-2 virus, saying the test kits from Shenzhen Bioeasy Biotechnology were unreliable. Turkey also rejected the Shenzen Bioeasy test kits after finding similar problems, according to The Middle East Eye. Ukraine and Georgia also bought kits from Bioeasy, according to published reports.
The low accuracy rate of the Bioeasy coronavirus test kits raises questions about the rapid rate of development for new tests in the United States and worldwide, said Michael Noble, MD, FRCPC, Chair of the University of British Columbia (UBC) Clinical Microbiology Proficiency Testing program and the UBC Program Office for Laboratory Quality Management, in Vancouver.
“There’s
an inherent problem with building a test during a crisis,” Noble said in an
interview with Dark Daily. “Clinical laboratory test developers are
being forced into building tests in a hurry, and the highest likelihood is that
they will fail because these tests take a lot of time if the aim is to get them
right.
“When
a company or a lab feels the need to go too fast, it is likely to take
shortcuts,” he added. “And every time a shortcut is taken, an opportunity for
error is created.
“Also,
the federal Food and Drug Administration (FDA) may be going too fast to issue
emergency use authorizations (EUAs). If laboratory test developers and the FDA
go too fast, then both could make mistakes,” Noble noted.
“The lesson for labs in the United States and everywhere is you can’t go too fast and you don’t want to go too slow either,” Michael Noble, MD (above), Chair of the University of British Columbia Clinical Microbiology Proficiency Testing Program, told Dark Daily. “Instead, you need to proceed as quickly as you can, but also take as long as you need to ensure you follow all the steps accurately.” (Photo copyright: The Dark Report.)
Bioeasy
Questions Whether Tests are Being Used Correctly
On
March 27, SCMP reported that Shenzhen Bioeasy would send new kits to
ensure that “patients get the best diagnostics” and to “ensure the test kits’
sensitivity and specificity.” The company also raised questions about whether
the tests were used properly and promised to send a video explaining how those
administering the tests should collect specimens using NP swabs.
“As
it [is a] rapid test kit, following the protocol is very important,” the
company added, according to SCMP.
Last
week, Zhu Hai, a manager at
Shenzen Bioeasy, said reports that the test kits had a low accuracy rate were
untrue, SCMP reported. A more detailed explanation would be given via
official Chinese government channels, he added.
Shenzen
Bioeasy also issued a statement about the tests, saying, “The production export
of our CE products to Spain has been done according [to] regulations. All
Bioeasy COVID-19 rapid test [kits] are officially CE-IVD approved, so we are free
to [export] and sell in [the EU],” SCMP reported.
The company exported 337,000 tests to South Korea and more than 420,000 test kits to at least 10 countries, including Italy, Qatar, and Ukraine, the company added. It had five million such kits under production, the company said.
Spain
Purchased More than Half a Million Bioeasy Test Kits
One
of the first publications to report the inaccuracy problems was El País, a Spanish
language daily newspaper in Madrid.
The
Shenzen Bioeasy tests functioned much like pregnancy tests, the newspaper
wrote. Once the sample is taken, the NP swab is diluted and placed into a
cartridge with a lined test strip showing whether the result is positive,
negative, or invalid. “The tests detect the presence of antigen and the result is obtained in 10
or 15 minutes,” El País wrote.
Based
in part on a claim that the medical laboratory test kits have an 80% accuracy
rate, the government purchased 640,000 kits to screen health workers and the
elderly. If the Chinese tests were of sufficient quality, negative or doubtful
results would require a confirmatory molecular diagnostics test, the
newspaper added.
The
Chinese embassy in Spain also responded, saying on Twitter on March 26 that
the country’s National Medical Products Administration had not approved the
tests, and that they were not included in the medical supplies the Chinese
government sent to Spain, SCMP reported. “The Chinese Ministry of
Commerce offered Spain a list of approved suppliers, in which Shenzhen Bioeasy
Biotechnology was not included,” the embassy added.
After
the low accuracy rates were reported, the Spanish government said it ordered
€432 million (US$468 million) worth of medical supplies from China, 5.5 million
test kits, 550 million face masks, and 950 ventilators, SCMP added. But
none of the kits in this order were from Shenzen Bioeasy, the government said.
SCMP quoted Professor Leo Poon
Lit-man, BSc, MPhil, DPhil, FFPH, an expert in the SARS-CoV-2 coronavirus
who helped design a testing protocol for the COVID-19 illness, and who is a
Professor and Division Head of the Division of Public Health Laboratory
Sciences at The University of Hong Kong. A claim of 80% accuracy
for a test using nasal swabs was perplexing, because such tests are known to be
inaccurate, Poon said. “It would be dangerous if it’s used on a large scale,
since patients who are supposed to be positive might not be detected,” he
added.
Pathologists
and clinical laboratory scientists know there are many reasons why a clinical
laboratory test can be unreliable or inaccurate. For example, during the
production of a batch of tests, one step in the manufacturing process may have
gone awry and that problem was not detected before those tests were shipped to
a medical laboratory.
Unfortunately,
when lab tests are proved to be “unreliable” or inaccurate, the public or the
medical laboratory profession seldom learn the reasons for these problems and
what steps were taken to resolve them.
This is an opportunity for top-producing sales reps from medical laboratories, anatomic pathology groups, and lab vendors to achieve national recognition at the upcoming Executive War College
Nominations are now open for The Dark Report’s 5th
Annual National Lab Sales Excellence Awards. This awards program recognizes
those laboratory sales professionals who exceed sales goals and successfully
help their lab organization win new clients and expand market share.
Nominating applications are available at Executive War College/5th Annual National Lab Sales Excellence Awards and should be submitted by the sales professional’s sales manager based on the sales rep’s 2019 performance. Winners will receive an all-expense paid trip to New Orleans for the 25th Annual Executive War College on Lab and Pathology Management on April 28-29.
Each winner will also receive a check for $2,000!
“This is the fifth year for this first and only national recognition program in the United States for sales professionals involved in the clinical laboratory profession,” stated Robert L. Michel, Editor-in-Chief of The Dark Report. “It’s important for our industry because it shows the leaders and pathologists in other labs that, despite negative trends in the lab marketplace, there are sales professionals who continue to generate substantial volumes of new clients, new specimens, and new revenue for the clinical labs and pathology groups they represent.
“Moreover, as the sales team in your lab learns what some of
their top-performing peers have accomplished, it raises the bar and motivates
them to achieve more and reach for stretch goals that benefit them personally
and contribute to the success of the lab that they represent,” emphasized
Michel.
“Each year, the winners of the National Lab Sales Excellence
Award tell us that this recognition was not only important for them, but that
their hospital CEO and senior administrators took notice and it raised the
profile of the lab throughout the entire hospital because of the national
recognition for the accomplishments of the lab’s top sales producer. In some
cases, the local newspapers picked up the story and reported it—another
positive benefit for the lab in the community. Some award winners report that
just the news coverage of the award led to new accounts from physicians who
wanted the top service these lab sales professionals deliver.”
Winners are selected in each of three categories that represent
the major sectors of the lab testing marketplace. The sectors are:
Hospital Laboratory Outreach;
Independent Clinical/Anatomic Pathology
Laboratory (including molecular and genetic testing); and
Robert L. Michel, Editor-in-Chief of The Dark Report, is shown above with Tammy W. Mullen, Sales Representative with HealthLab in Aurora, Ill., a full-service, pathologist-directed clinical laboratory that is part of Northwestern Medicine. Mullen received her award during the 2019 Executive War College on Laboratory and Pathology Management in New Orleans. Each year, Laboratory Sales professionals are recognized for their achievements with the National Lab Sales Excellence Award. (Photo copyright: The Dark Report.)
Nominations for National Lab Sales Excellence Awards
“We are asking that the sales managers and sales VPs of
these sales reps nominate their top candidates. Nominations of these
high-achieving medical lab industry sales professionals for the National Lab
Sales Excellence Award are being accepted now. Details and the nominating form
are available by clicking here
or by copy and pasting this URL into your web browser: https://www.executivewarcollege.com/lab-sales-excellence-award-contest/.
To be considered, nominee applications should encompass
actual sales results, feedback from nominating managers, and references from
clients. Lab sales professionals will also be judged on other variables, such
as:
The competitive environment;
Compliance with all state and federal
regulations; and
Ethical behavior.
“A panel of judges will evaluate each nomination,” noted
Michel. “These are individuals with their own impressive track record in sales
and marketing. They understand the techniques of ethical selling, the unique
aspects of marketing laboratory tests, and how much effort is required to build
the number of clients, specimen volume, and revenue from assigned territories.”
It’s the medical laboratory industry’s first and only National Laboratory Sales Award program. Sales representatives employed by clinical laboratories, anatomic pathology groups, specialty molecular and genetic testing lab companies, in vitro diagnostics companies, and laboratory information technology companies will be competing for national recognition as The Dark Report announces the winners of its 5th annual National Lab Sales Excellence Awards during the Executive War College on Laboratory and Pathology Management, which takes place April 28-29, 2020, in New Orleans. (Image copyright: The Dark Report.)
2020 Lab Sales Awards to Be Announced on April 29 in New
Orleans
Nominations for the National Lab Sales Achievement Award are
to be submitted to the offices of The Dark Report by Friday, March 20,
2020. Winners in each of the three categories will be notified by April 3 to
allow them time to make arrangements to travel to New Orleans to be at the
Executive War College for the award ceremony.
“Lab CEOs and hospital/health network lab administrators should recognize how having a winner from their sales team can turbo-charge their entire clinical laboratory sales program,” observed Michel. “By their nature, the 20% of the sales reps in your marketing program who do 80% of the business are highly competitive. We’ve had the sales vice presidents who nominated their top sales producer tell us, a year later, that having a National Lab Sales Excellence Award winner motivated the entire sales team, and that their lab saw substantial increases in specimen volume and revenue because other sales reps wanted to step up to the plate and show what they could produce.”
Michel also took the time to address the long-standing
popular wisdom in the clinical laboratory industry that every lab wants to keep
its top sales producers under wraps, because if competitors knew how much new
lab business they were generating, competitors would recruit them away.
“This is one of those clinical lab industry widely-held beliefs that
needs to disappear,” he explained. “The reality is that, in every community,
competing labs (and competing sales reps) always know who the top producers
are. Good lab leaders know how to retain their top performers and one way to do
that is to boost their reputations and recognize their sales achievements by
nominating these high-energy, result-driven producers for the unique
recognition that comes from the National Lab Sales Excellence Award.”
Lab CEOs, administrators, Sales VPs, and Sales Managers—you can click here to get the nominating form for the 5th Annual National Lab Sales Excellence Awards (or by pasting this URL into your browser: http://www.executivewarcollege.com/wp-content/uploads/National-Lab-Sales-2020-Nomination-Form_02-13-2020.pdf).
Online reputation management is increasingly becoming a critical function that all providers, including clinical laboratories, must address or risk losing revenue
Recent surveys cite growing evidence that Facebook (NASDAQ:FB) and online review sites such as Yelp (NYSE:YELP) are swiftly becoming healthcare consumers’ preferred sources for researching doctors, hospitals, medical laboratories, and other medical service providers.
Healthcare consumers are using the Internet to review information
on healthcare providers prior to visits. More important, data show a majority
of Americans share their healthcare experiences publicly online following
visits with providers.
This should serve as a wakeup call for clinical laboratories and anatomic pathology groups that have not developed effective social media strategies, as they are clearly among the health services being evaluated.
More than half of Americans (51%) reported sharing their healthcare experiences online, an increase of 65% over just one year ago;
Among Millennials (people born between 1981 and 1996) that number jumps to 70%, a 94% increase over last year;
70% of Americans overall say online ratings and reviews influenced their choices of physicians and facilities;
More than 40% of respondents admitted they researched doctors online even after being referred to them by another healthcare professional.
“The survey results underscore the significance of online ratings and reviews as online reputation management for physicians becomes ever-more important in today’s healthcare environment,” said Aaron Clifford, Senior Vice President of Marketing at Binary Fountain, in a statement. “As patients are becoming more vocal about their healthcare experiences, healthcare organizations need to play a more active role in compiling, reviewing, and responding to patient feedback if they want to compete in today’s marketplace.”
Healthcare Dive also noted that Millennials are likely to consider online reviews and ratings of healthcare professionals to be trustworthy.
97% of 24- to 34-year-olds report believing
online comments are reliable;
While 100% of the 18- to 24-year-olds surveyed felt
similarly.
Pathologists and clinical laboratory administrators should
consider the two findings above as evidence that a major change has already
happened in how the younger generations look for—and select—their hospitals,
their physicians, and their clinical laboratory providers. Thus, every
pathology group and clinical laboratory should have a business strategy for
managing the Internet presence of their labs. Failure to do so means that
competing labs that do a good job of managing their Internet presence will be
more successful at winning the lab testing business of Gen Xers (born
1965-1980), Millennials (Gen Y, born 1981-1996), and Gen Z (born 1997-2009).
In addition, the survey discovered that the most important
qualities consumers look for in a doctor are:
Friendly and caring attitudes;
Physicians’ ability to answer questions; and
Thoroughness of examinations.
Those polled reported the most frustrating issues when
dealing with healthcare professionals were:
Office wait times;
Cost and payment concerns;
Wait times for exam and medical laboratory
results; and
Scheduling appointments.
It’s All in a Word
Earlier this year, Healthcare Dive also reported on research that examined online reviews and their content conducted by Penn Medicine. Researchers at the University of Pennsylvania used digital tools and data analytics to help healthcare providers better understand and improve the patient experience.
The researchers analyzed 51,376 online reviews about 1,566
hospitals posted on Yelp over a 12-year period. They published their findings in
the Journal
of General Internal Medicine (JGIM).
They concluded the word most often found in positive Yelp
reviews was “friendly.” Their example of how positive review writers used this word:
“The doctors, nurses, and X-ray technician who helped me out were all so cool
and friendly. It really restored my faith in humanity after I got hit on my
bike.”
Other words the researchers commonly found in good online
reviews include “great, staff, and very.”
“Told” was the word most often found in negative reviews. The
researchers’ example: “I constantly told them that none of that was true and
the nurse there wouldn’t believe me.” It appears from the JGIM study
that Millennials often felt healthcare professionals did not listen to them.
The researchers identified “worst, hours, rude, said, no and
not” as other words often found in negative reviews.
“As providers, we need to take a moment to think about how we talk in hospitals, but also what patients are hearing,” said lead author of the Penn Medicine study Anish Agarwal, MD, Assistant Professor of Emergency Medicine at the University of Pennsylvania. “I may say something, but the way it’s heard and interpreted and then processed within patients when they’re going through a vulnerable time can be different.” (Photo copyright: University of Pennsylvania.)
Half of Millennials Prefer Internet Research and Online
Virtual Healthcare
Another survey conducted by Harmony Healthcare IT, a health data management firm based in South Bend, Ind., found that more millennials are researching the Internet for medical advice in lieu of actual doctor visits.
PC Magazine reported Harmony Healthcare IT’s survey found:
73% of Millennials reported following medical
advice found online instead of going to a doctor; and
93% reported researching medical conditions
online in addition to a doctor visit.
The survey also found that 48% of millennials trust online
resources for medical information and that 48% prefer virtual doctor office
visits over in-person visits.
In addition, 24% of this age group have gone five or more years without a physical and 57% prefer high-deductible health plans (HDHPs).
“With an emphasis on convenience, low cost, and technology, it will be interesting to see how this generation helps shape the future of health and how both patients and providers will adapt to those changes along the way,” Harmony Healthcare IT wrote in a blog post.
The results of these surveys illustrate why clinical laboratories
and anatomic pathology groups must have a social media strategy for managing
their reputations and presence on the Internet, especially where Millennials
are concerned.
That strategy should include easy and informative ways for
patients to learn about medical laboratory services, pricing of lab tests,
quality of work, and methods consumers can use to leave online feedback and
receive responses to their comments.
Sale of respected laboratory information system company may be an early sign that investors believe clinical laboratories and pathology groups are ready to upgrade their LISs and add needed capabilities
In the past 10 years there has been little disruption to the
laboratory
information systems (LIS) market that clinical
laboratories and anatomic
pathology groups use. Yet, over that same 10-year period, almost every
hospital and physician group practice adopted an electronic
health system (EHR), primarily because of federal financial incentives that
encouraged such adoption.
For medical
laboratories and pathology groups, this widespread—nearly
universal—adoption of EHRs by the nation’s hospitals and physicians was
disruptive. Labs were required to expend resources building digital interfaces
to the EHRs of their parent hospitals and client physicians to support
electronic test ordering and test reporting.
However, because that wave of EHR adoption is now over,
clinical labs and pathology groups have an opportunity to assess the current
state of the health
information technology (HIT) that they use daily, primarily in the form of
the classic laboratory information system that handles nearly all the primary
functions needed to support testing and other operational needs.
This opportunity to help medical laboratories enhance and/or
upgrade the capabilities of their laboratory information systems may be one
motivation behind the recent sale of a well-known LIS company.
Private Equity Firm Buys Orchard Software
On Oct. 7, 2019, Orchard Software Corporation of Carmel,
Ind., announced its acquisition by Franciscan Partners, a private equity firm
based in San Francisco.
Orchard Software, founded in 1993, has grown steadily over
the past 20 years, primarily by serving physician office laboratories,
community hospital labs, and independent clinical laboratory companies. With each
stage of growth, Orchard added functionality to its LIS and related software
offerings and moved up-market to serve larger hospitals and larger labs.
The purchase price and the terms of the sale were not
announced. Orchard’s Founder, President and CEO, Rob Bush, will retire. The new
CEO is Billie Whitehurst, who came to Orchard from Netsmart Technologies, where she was Senior
Vice President. The remainder of Orchard’s management team will be kept in
place.
“Francisco Partners will provide capital and expertise to enable Orchard to grow at a faster pace and continue to develop its newer web-based products in an industry that has lagged behind in adoption of cloud-based software,” says Rob Bush (above), Orchard Software’s Founder and exiting CEO, in a press release. (Photo copyright: Twitter.)
Is the LIS Market Heating Up?
What makes the purchase of Orchard by a multi-billion-dollar
private equity company noteworthy is the fact that it is the first significant
transaction in the LIS sector probably since the mid-2000s, which saw several
significant mergers and acquisitions.
Other acquisitions or investments involving LIS companies
need to happen before it would be appropriate to say that investor interest in
the LIS sector is heating up. However, it is accurate to say that many
professional investors will be watching to see whether Franciscan Partners
succeeds with its investment in Orchard Software. If Orchard’s revenue and
operating profits increase substantially in the next few years, that may
encourage other investors to look for LIS companies and products that they can
buy.
If this were to happen, that would be a positive development
for both clinical laboratories and anatomic pathology groups, because these
investors would have a motive to add new functions and capabilities to their
LIS products. It would also wake up a sector of lab information technology that
has been relatively quiet for several years.
