News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel

News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel
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Offsetting the Rising Costs of Hospital Laboratory Reference and Send-out Testing

Baystate harvests annual savings of 20%+ from simple strategies and steps

In today’s depressed economy, hospital laboratories are scrambling to control costs, reduce unnecessary spending, and get more for every dollar they spend. That is why the constantly-rising cost of reference tests and send-out referrals are now a prime target for laboratory budget-cutters across the United States.

Every laboratory’s reference/send-out test program is a potential budget-buster, for three reasons familiar to every lab director.

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Seattle’s Valley Medical Center says: “Quest Out, PACLAB In!”

Today in Renton, Washington, Valley Medical Center announced a new comprehensive contractual relationship involving medical laboratory services with PACLAB Network Laboratories of Bellevue, Washington. This is a significant development in the Greater Seattle market for several reasons.

First, it means that Quest Diagnostics Incorporated (NYSE:DGX) has lost another important hospital relationship in Greater Seattle, once again to PACLAB. It was back in December, 2003, when 244-bed Evergreen Hospital Medical Center of Kirkland, Washington, similarly terminated its comprehensive laboratory testing relationship with Quest Diagnostics and became part of the PACLAB regional laboratory network.

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U.S. Hospital Employment Declines for First Time Since 2004!

First-ever Gathering of Lab CFOs, Controllers to take place on April 28-29, 2009

News that the number of hospital jobs in the United States fell for the first time since June 2004 reveals several useful insights for clinical laboratory managers and pathologists. The U.S. Bureau of Labor Statistics reported that, for March 2008, the number of hospital jobs declined by 700, against a total hospital workforce of 4.71 million.

This small decline-less than one-tenth of one percent-demonstrates that demand for hospital services continues to be relatively resistant to economic declines. However, other Labor Bureau statistics highlight a darker picture for the long-term fortunes of hospitals. The entire healthcare sector picked up a net increase of 16,500 jobs, with most of this coming from the ambulatory services sector. For example, physicians’ offices added a net of 3,200 workers. By contrast, the overall U.S. economy shed 663,000 jobs in March, with the national unemployment rate ending the month at 8.5%.

As reflected in these numbers for March, hospital employment declined by a tick while overall employment in healthcare increased in spite of the economic recession. This illustrates two fundamental trends in healthcare. First, demand for health services during this recession remains robust enough that hospitals continue to need almost all their workers. Second, growth in outpatient demand for services continues to outstrip growth in demand for inpatient services.

To understand the implications of these trends on clinical laboratories and pathology laboratories, the first-ever national gathering of laboratory CFOs (chief financial officers), controllers, and financial experts is taking place in New Orleans on April 28-29, 2009 at the Executive War College on Laboratory and Pathology Management. This unique session will be led by Kurt Rogers, CFO of Pathology Associates Medical Laboratories (PAML) of Spokane, Washington. Access the full agenda with this agenda link.

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California Whistleblower Lawsuit Ensnares Major Lab Companies

Allegations of false claims implicate discounted client billing practices

It’s the first major whistleblower lawsuit in the laboratory industry in recent years. On March 20, California State Attorney General Edmund G. Brown Jr. announced that his state had joined a qui tam lawsuit that alleges a number of laboratories have filed false claims on a “massive” scale, thus defrauding the California Medi-Cal program of “hundreds of millions of dollars.”

The unusual twist in this whistleblower lawsuit is that it was originally filed by the owner of a California-based laboratory. In 2005, Chris Reidel, owner and CEO of Hunter Laboratories, in Campbell, California, initiated the legal action, alleging what AG Brown characterized as “massive Medi-Cal fraud and kickbacks. Medi-Cal is the state’s Medicaid health program for the poor.

The original lawsuit filed by Reidel seeks to recover at least $100 million. However, one of his attorneys, Joe Cotchett, of the San Francisco-based law firm of Cotchett, Pitre & McCarthy, believes the state’s actual losses could be more than $1 billion. The lawsuit is pending in San Mateo Superior Court and was filed under seal in 2005.

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Family History “Remains Most Valuable Genetic Test”

Pathologists Discuss State of Genetic Testing at World Congress of Pathology

Dateline: Sydney, Australia- New-fangled technology is making genetic testing and molecular diagnostics ever more precise tools to aid clinicians, but at least two internationally-respected experts in genetics still consider family history to be a primary-if not the most useful-source of knowledge about a patient’s genetic risk factors. Both experts were in Sydney, Australia, to speak at the XXV World Congress of Pathology which took place on March 13-15, 2009.

“Family history remains the most valuable genetic test available to us today,” declared Michael S. Watson, Ph.D., Executive Director of the American College of Medical Genetics in Rockville, Maryland, in his presentation titled “Translation of Genetic Information into Healthcare Use.” He discussed the importance of building a multi-dimensional health record that included family history and would follow the patient from cradle to grave. (more…)

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