Short-Term Investment for Long-Term Gain

Short-Term Investment for Long-Term Gain

Where should clinical labs invest their limited money to best position themselves for the future?

It's tempting to funnel money to areas that managers already understand—such as upgraded equipment for doing specific tests or adopting the next version of the laboratory information system—but they should really be looking at investments that tax their comfort level, says Brian Jackson, Associate Professor of Pathology, University of Utah and Chief Medical Informatics Officer, ARUP Laboratories.

“A lot of academic labs have put tons of money into expensive, next-generation sequencing instrumentation, because it's frankly a really sexy area right now, and a lot of lab leaders have enough familiarity with genetic testing to feel comfortable," he says. “But in many cases, that's just not the area that is strategic for a particular lab." For large national reference labs, their existing sequencing instrumentation might be adequate for the moment, and the lab should consider increasing its bioinformatics capabilities in order to take advantage of the data being collected, or increasing capacity and throughput by automating.

Article highlights:

 
  • Clinical labs must invest for the future despite tight resources.
     
  • The best investments may be outside the lab leaders' comfort zone.
     
  • Evaluate new investments for their impact on both current and future capabilities.
     

 

Contributing Lab Leaders

Brian Jackson

Brian Jackson, MD

University of Utah and ARUP

 

Terry Carroll

Terry Carroll

SPRING Network

 

 

 

Invest in value

For smaller labs, Jackson explains, that massive investment in sequencing probably doesn't make sense, and money might be better spent looking outward, investing in the ways they communicate with their customers. “I'd like to see many labs making bigger investments in their physician and customer-facing communication platforms," Jackson says. They can minimize the cash outlay by using off-the-shelf software. The biggest investment is in staff time to redesign workflows and procedures to take advantage of the new capabilities.

Labs can invest more effectively by keeping an eye on their core mission of providing diagnostic testing for patient care, and not overreacting to new reimbursement models that seem to affect their position as a profit center for their institutions. “A common mistake is for health systems to think of their labs as profit centers," notes Jackson, "and then when things like MACRA come along, they panic and sell off their labs to one of the big commercial labs, which is totally short-sighted." Labs should focus on investments that improve their ability to provide value to their organization regardless of payment model.

A four-quadrant model

Labs can use a four-quadrant model to analyze where they are, where they want to be, and how to get there, says Terry Carroll, a long-time health system CIO who's now a principal with the SPRING Network, advising healthcare organizations on how to position themselves for the future. The horizontal access goes from “traditional" to “revolutionary," and the vertical axis goes from “current/legacy technology" to “advanced technology."

The four quadrants of the model can help labs evaluate any particular investment, and identify:

1. Which investments in current technology will support how the lab currently operates

2. Which investments in current technology will allow the lab to innovate.

3. Which investments in advanced technology can help with current operations.

4. Which investments in advanced technology will pay off in innovation.

Stay flexible

The ability to adapt an investment plan to changing conditions is as important as the ability to make a plan in the first place, Carroll says. He compares it to a military model. “You can plan how a battle will be executed, but the minute you step on the battlefield, it changes."

“If you took a static approach, you would miss the mark" by the time you reached the end of a long-term plan, Carroll adds. “You have to be highly adaptive, constantly measure the performance of the plan, and fix things before they get too far out of hand."

 


Additional resources

  • Project management: importance for diagnostic laboratories
    By A.Croxatto and G.Greub
    The need for diagnostic laboratories to improve both quality and productivity alongside personnel shortages incite laboratory managers to constantly optimize laboratory workflows, organization, and technology.

  • Eight pitfalls of healthcare project management
    By Reda Chouffani
    Healthcare project management can be a long and involved process. To keep a project on course, learn how to communicate long and short-term goals and concerns properly.

  • All for one, one for all? Laboratory consolidation
    By Anne Paxton
    Consolidation among hospitals and laboratories can sometimes seem like too massive a tide for independent and hospital-based laboratories to effectively resist. What are the advantages that large size provides to a hospital system or national lab in a competitive marketplace? And will there be any space left in which smaller laboratories can survive?

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