Laboratory consulting companies provide strategic guidance that enables labs to get from their current state to their desired state. This process can include everything from finances to space planning. However, an experienced clinical laboratory advisory team will be doing more than just improving processes—it will help executives look ahead to the future of their company and plan out a robust midterm and long-term strategic plan.
For example, say a health system is interested in getting into the molecular and genetic testing space. There is a huge opportunity in that space, with high-revenue yields. However, there are many success factors that need to be in place in order to take advantage of that opportunity. Unless a lab has appropriate expertise and scale, expansion can generate more costs than profits. A health care advisory consultant can help leaders weigh the pros and cons of such an important call.
It may come as a surprise, but the laboratory sector in the US is valued at $8 billion. It is big business, and it takes a lot of business analytics to make the most of an organization’s opportunities. Having a strategic partner can also help hospital lab consulting organizations navigate challenges, such as a historically tight labor market. From fine-tuning patient care to recruiting laboratory personnel, advisory services can simplify and streamline operations.
A hospital lab consultant is a professional who can advise lab directors and technicians on both tactical and strategic aspects of operations. On the tactical side, a lab consultant might redesign a quality management program or improve the productivity of the lab by introducing a new layout. On the strategy side, a consultant will help the lab director evaluate and commit to long-term decisions that impact the bottom line. Perhaps the most important thing a consultant can do is provide genuine due diligence for lab strategies. They can help lab directors match expertise with opportunity to enhance the quality, efficiency, and profitability of their unit.
Hospital lab consultants work in tandem with a number of experts. A good advisory service will be comprised of many experts in the business, compliance, quality, safety, supply chain, and efficiency aspects of lab operations. This allows consultants to subject lab operations to a detailed review that takes account of multiple perspectives. By drawing on this expertise, lab consultants provide valuable feedback and insight that helps labs move closer to achieving their strategic goals. Then, they work hand in hand with lab directors and staff to develop and implement new processes and methods that align with up-to-date medical standards.
A good hospital lab consultancy will tailor its services to the unique needs of its clients. Just like an NFL team has a different game plan when it plays different teams, hospital lab consultants will take a different approach to every challenge that clients bring their way. As a result, hospital lab consultant fees vary from project to project. A project that only involves a single tactical issue, such as the reorganization of a lab’s layout, will cost less than a job involving a long-term strategy that impacts many different areas of operations.
Hospital lab consultants offer labs their knowledge. Some labs may already have the expertise needed to fully optimize their approach to quality, productivity, cost optimization, and compliance. However, many labs may struggle with some, or even all, of these areas. That is where hospital lab consultants come in. Hospital lab consultants have broad experience with many companies, so they can take the lessons they’ve learned and apply them to new challenges. They also employ the latest management techniques and key performance metrics to deliver unbiased quantitative and qualitative recommendations. These services are tailor-made for the unique challenges facing health care executives.
It makes sense to hire a hospital lab consultant whenever your organization is faced with a challenge that requires specialized expertise. This is especially true whenever a large investment is being considered. If a health system is preparing to spend tens or even hundreds of millions of dollars in the hopes of increasing future profits, it’s a good idea to subject that decision to the most rigorous due diligence possible. A health care advisory service can evaluate the investment and point out any potential flaws. That way, health care executives can be sure that they are making the best use of their organization’s resources.
Authentic feedback. Especially when the consultant is being asked to address issues of strategic importance, they should be expected to take the lab’s perspective and identify the actions that will truly move the organization closer to reaching its strategic goals. In some cases, that will mean that the consultant will have to point out systemic issues that require thoroughgoing changes. Of course, in order to identify and ameliorate these issues, the consultant needs to have expertise in lab operations. They also need to be able to work as a team with other consultants to evaluate operations from many different angles.
Many lab directors might be tempted to focus on revenue generation, but that’s only half of the picture. Profitability is as much about reducing and controlling costs as it is about revenue growth. In fact, many labs can endanger their revenue base by expanding too fast. Just because it seems like the lab can bring in tens of millions of dollars by adding a new type of testing to its service list does not mean that those revenues will outpace costs. A lab that doesn’t have the appropriate expertise or staffing to handle an expansion into a new type of testing is likely to doom its operations, causing both staff and customers to question the trustworthiness of lab leadership. This means that success factors must be in place for revenue growth to improve the bottom line.
Cost cutting is both a science and an art. Most of the over two thousand diagnostic tests offered by clinical laboratories are very low yield, and they have low throughput. However, that doesn’t mean that labs can’t capitalize on economies of scale. If a technician is putting fifty test tubes onto a tray, very little is required for them to double that to one hundred. So one way to cut costs is to look for ways to increase the efficiency of everyday lab operations. The supply chain is another place to look to for cost-cutting opportunities. An experienced supply chain expert will be able to draw on a wide variety of suppliers and negotiate effectively to bring costs down.
One way to increase ROI is to optimize the physical layout of the lab. Oftentimes, labs are poorly organized, and technicians have a hard time moving about the lab safely. There should always be at least four feet of walkway to let people move past one another quickly. That being said, it would be best for people to move as little as possible. Wasted motion not only reduces the productivity of the lab but also demoralizes technicians. People want to be productive at work, and nothing will sap their energy like wasted time. As a result, it’s recommended to group similar types of equipment together so that technicians won’t have to move very far in order to access the tools they need to perform tests.
From a purely financial perspective, hospital lab ROI is just a matter of revenues and costs. However, it’s worth noting the crucial role that trust plays in driving lab ROI. Patients and health systems trust hospital labs to deliver reliable and timely diagnostic services. That trust is the foundation of clinical lab operations. As a result, no attempt to improve ROI can endanger the trust that people have placed in a clinical lab. That being said, there are many tactical and strategic improvements that a lab can make to reduce costs and increase output. These range from optimizing layout to getting assistants to complete higher-value tasks during their shifts.
It may not seem like it, but hospital laboratories are an $8 billion business in the United States. That’s big business. However, not every hospital lab is profitable. In fact, due to increasing regulatory burdens and competitive pressures, many hospital labs are being closed as health systems consolidate. For many health systems, it makes sense to capitalize on economies of scale with one high-throughput lab. This means that labs that want to remain open have to be as profitable as possible. It’s worth noting in this connection that diagnostic testing is recession proof. It doesn’t matter what’s happening in the broader economy; people still need to take tests, which typically creates a steady revenue stream. As a result, the way for most labs to increase profits is to control their costs and improve productivity.
About three quarters of all medical decisions are based on laboratory results
Unnecessary supply chain spending cost hospitals more than $25B in 2018 – an increase of more than 10% over 2017 levels
Overutilization of lab testing is at an all-time high, with an overall mean rate of 20.6%.
Jeff Myers, CPA, is the Vice President of Strategic Advisory Services for Accumen and provides expertise on Lab Operations, Consolidation, Strategy, Outreach, and Performance Improvement. Jeff has over 20 years experience in health care finance, focusing on financial analysis, decision support, strategic guidance, and operational improvement analysis. His industry experience includes physician practice management, health insurance, commercial laboratory, and academic health care systems. A Certified Public Accountant (CPA), Mr. Myers graduated with honors from the University of Tennessee with a Bachelor of Science degree in Accounting and Business Law.
Jeff Downs is the Vice President and General Manager of Accumen’s Strategic Advisory Services team. Strategic Advisory Services advises health systems on a wide variety of consulting topics from cost assessments / benchmarking and test utilization management to strategic planning, core lab concepts, outreach market analysis and space planning. Jeff has 24 years clinical laboratory experience including 10 years consulting with Health Systems and 10 years as a lab Chief Financial Officer. In addition, he has related experience in both physician practice management, population health/disease management, reagent / instrument manufacturing and research and development activities. Jeff received his MS in Biomedical Diagnostics from Arizona State University and a B.S. in Accounting from Elon University. Additionally, Jeff is a Certified Public Accountant and an alumni of LabCorp, Deloitte and CVS/Caremark.
Kim brings over 10 years of laboratory experience as both technician and leader in military and civilian clinics and hospitals. Prior to joining Accumen, Ms. Zunker worked as a Medical Technologist and later, Supervisor of the growing laboratory at Soin Medical Center, part of the Kettering Health Network, where she led day-to-day operations as well as multiple process improvement initiatives.Prior to Kettering Health Network, Ms. Zunker served as a Laboratory Officer in the Biomedical Sciences Corp of the United States Air Force. She managed two Air Force Laboratories, winning multiple awards and earning several military decorations. Ms. Zunker earned a Bachelor of Science in Clinical Laboratory Science from Midwestern State University and a Master in Business Administration from the University of Dayton. She is a nationally certified Medical Laboratory Scientist by the American Society of Clinical Pathologists and holds a CAPM certification (Certified Associate in Project Management) from the Project Management Institute.
Nora has more than 15 years of healthcare consulting experience with Chi Solution Inc (part of Accumen since 2016). Prior to consulting she was an Administrative Laboratory Director for a Florida health system for 12 years. Prior to that she worked as a Medical Technologist in laboratories in Florida and Massachusetts. Nora has extensive experience in strategic planning, process redesign, laboratory consolidation/integration, regulatory compliance, quality management and cost reductions initiatives. She has worked with hospitals and health systems across the US, providing consulting expertise to meet the individual requirements of each client. She also is a regular speaker at the annual Laboratory Quality Confab, speaking on topics related to Quality and Regulatory Compliance.Nora earned her Bachelor’s degree in Medical Technology from Northeastern University in Boston MA and an MBA from the University of Sarasota in Sarasota FL.
In the role of Healthcare Consultant at Accumen, Dori is able to combine her financial background with the clinical knowledge she has gained from working with laboratory clients over the last 20 years. Dori received her BBA in accounting from Eastern Michigan University in 1993.
Her accounting background provides a foundation to provide in depth financial analysis to assist Accumen partners with understanding the financial impact of decisions they are facing. Her experience in finance, data analytics, and project management have provided an opportunity to work with hundreds of hospitals and health systems across the country to profoundly impact healthcare.
Loria Green, Business Analyst at Accumen for the Strategic Advisory Services team. She is responsible for financial analysis, performance analytics, and market opportunity assessments. Loria has more than 25 years of experience in financial analysis. While at Chi Solutions, now an Accumen Company, she performs a variety of assessments for laboratories, hospitals and health systems. Loria earned a BAcc from Michigan State University.
As a Healthcare Consultant for Accumen, Stephen routinely advises clients in the areas of operations, strategy, space design, and regulatory compliance. His background in laboratory management, operations, process improvement, and medical science, offers clients a unique and integrated blend of insights. Stephen is a California licensed Clinical Laboratory Scientist with certification from the American Society for Clinical Pathology. Stephen holds a bachelor’s degree in Clinical Laboratory Science from Loma Linda University. He graduated from the University of Redlands with a Master of Business Administration, as well as a Master of Science in organizational leadership. In addition, Stephen holds professional certificates in lean six sigma and project management from the University of California, Riverside.