Chi Solutions, Inc. (Chi), an Accumen company, has conducted a national survey tracking and analyzing hospital and health system laboratory and outreach developments through key metrics for sixteen years. In this report, Accumen Inc. (Accumen) and its subsidiary Chi Solutions, Inc. (Chi) present observations on key findings from their latest 2017 Annual National Hospital/Health System Laboratory and Outreach Survey. This report provides a comprehensive analysis of laboratory industry trends for health system executives and those responsible for laboratory outreach programs.
In April 2015, the first in a series of two blogs (Observations of Large Laboratory Outreach Programs – Part 1) shared results of research conducted by Chi and presented at the 2015 G2 Intelligence Lab Revolution conference on how hospital-based outreach programs are confronting the new demands of healthcare. The April blog provided insights on revenue size, growth, and sources; medical staff employment; strategy focus; use of in-office phlebotomists; and types of sales representatives. Below are additional study findings with regard to the typical large laboratory outreach business:
Answer each of the following three questions to test your knowledge of the value of hospital laboratory outreach programs:
- What is the profitability of your laboratory outreach program compared to hospital peers and the national laboratories (Quest Diagnostics and LabCorp)?
- True or False: Outreach is a low margin business compared to other hospital departments.
- True or False: Hospitals cannot compete with the national laboratories as evidenced by lower growth rates year over year. Continue reading
Early this year, Chi Solutions, Inc. was asked to present at the G2 Intelligence Lab Revolution conference on how hospital-based laboratory outreach programs were confronting the new demands of healthcare. Chi took a comprehensive approach to address the issue by enlisting a number of vendors and consultants to provide programs that they knew were “large and successful.” There were 26 programs suggested and interviewed by Chi’s senior consultants. Of these, 20 were determined to meet the criteria of large and successful. The 20 were from locations scattered throughout the U.S. with seven of nine American Hospital Association regions being represented. Information was gleaned from one-hour interviews with the key leader of each program. Continue reading
We are all familiar with the expression “killing the goose that laid the golden egg.” Outreach is the goose of our industry—it can generate up to 50% of hospital EBITDA (earnings before interest, taxes, depreciation, and amortization) or profits. And the best part is that it keeps on laying golden eggs year after year!
Yet some hospitals have shot and dressed their “goose” because of:
- Short-term capital restraints.
- Need to reduce operating costs.
- Lack of understanding or belief about profitability.
- Inability to execute on the business.