CEO SUMMARY: What happens when 100 lab experts interact with an audience of more than 850 lab administrators, pathologists, and IVD executives from across the United States and seven other nations? A consensus of sorts emerges and during this 2016 edition of the Executive War College on Lab and Pathology Management, that consensus was how: 1) the pace of change in healthcare is unprecedented … and increasing; and, 2) genetic knowledge is poised to swiftly transform medicine.
TWO IMPORTANT LAB MARKET INSIGHTS EMERGED from the more than 60 sessions and 100 speakers at this year’s Executive War College on Lab and Pathology Management.
The first market insight involves the ongoing revolution in how healthcare is organized, how clinical care is delivered, and how providers are reimbursed. Not only is the current rate of change happening at an unpredecented pace, but there was consensus among the experts that lab executives and pathologists should expect changes to come even faster during the next 24 to 48 months.
The second market insight centers upon the expert consensus that both the profession of laboratory medicine and the house of medicine are poised for a revolution in clinical care. This will come as a direct result of the tsunami of knowledge that is emerging from research into human genetics, proteomics, microbiomics and other related “omics.”
These conclusions are credible. They reflect not just the opinions of the 100 speakers at this year’s program, but also the reactions to these presentations by the more than 850 lab executives, pathologists, IVD managers, and IT vendors in attendance at this year’s meeting in New Orleans on April 26-27.
Clinical labs and anatomic pathology groups would be well served to review their existing clinical, business, and financial strategies informed by these two market insights. It is timely to assess how a faster pace of change will influence the transformation of healthcare and of lab testing services. A swifter rate of change has the potential to significantly influence the effectiveness of the lab’s current clinical and financial strategies.
That influence can be both negative and positive. A lab that doesn’t respond to changes in clinical practices will be vulnerable. On the other hand, a lab can benefit from those same changes if it tracks this clinical transformation and introduces new diagnostic testing services that help physicians achieve better patient outcomes.
Multiple examples of significant transformation of hospitals and health systems were visible at this year’s Executive War College. For example, in Arizona, Banner Health, the state’s biggest health system, based in Phoenix, recently acquired the two-hospital University of Arizona Health Network in Tucson. It is now integrating those hospitals so they have the same EHR and IT systems.
Achieving Lab Integration
These developments were described in a keynote presentation by David A. Dexter, President and CEO of Sonora Quest Laboratories, a joint venture owned by Banner Health and Quest Diagnostics Incorporated. His laboratory has been working to fully integrate the laboratories of the University of Arizona Health Network with those of Sonora Quest and Laboratory Services of Arizona, the Banner inpatient lab organization.
Another development in Arizona is the growth of accountable care organizations (ACOs). Banner Health participates in multiple ACOs and has been successful with Medicare’s Pioneer ACO program. Dexter discussed how Sonora Quest Laboratories is changing in the ways needed to support physicians delivering care to ACO patients.
Dexter emphasized that it is important for all lab organizations to understand the Triple Aim of the Centers for Medicare & Medicaid Services in order to succeed during the ongoing transformation of healthcare. He then explained that, “at CMS, the Triple Aim focuses on the following:
- “Improve population and community health;
- “Seamless coordination of care; and,
- “Reduce per capita costs through improvement.
Medicare’s Triple Aim
“Sonora Quest Laboratories is working to support the Triple Aim,” he continued. “ACOs need data analytics in real time that is delivered to care coordinators to make it actionable. This data also needs to support providers’ key metrics for CMS.
“The ACO data load into the population health software is typically four to 12 weeks behind real time,” he continued. “That creates an opportunity for Sonora Quest Laboratories to provide its data in real time to both the ACOs and the clinicians treating the ACO patients. We are investing significantly in information technology so as to provide such data in real time.”
On the East Coast, the laboratory division of Northwell Health (formerly North Shore-Long Island Jewish Health), is dealing with most of the same changes happening to healthcare in Arizona. As the nation’s largest urban health system, Northwell Health operates 21 hospitals and more than 450 practice locations.
Lab Services at Northwell
In his keynote presentation, James M. Crawford, MD, PhD, Executive Director and Senior Vice President for Laboratory Services at Northwell Health, shared his lab’s strategies to add value that contributes to improved patient outcomes while helping reduce the cost-per-encounter.
Similar to the laboratory integration happening in Arizona as hospitals and health systems merge into ever-bigger organizations, in the New York metro, Northwell’s lab division has formed a laboratory joint venture. “The CLNY Alliance Network now includes, not only the lab testing sites of Northwell, but also another four core laboratories and 12 hospital labs of the other JV partners,” noted Crawford. “The goal of this laboratory joint venture is to compete for outreach business while returning clinical and financial benefits to the JV partners.
Large-scale, Whole-Human Genome Sequencing Underway in UK and at Human Longevity, Inc.
ONE SPECIAL HAPPENING at this year’s Executive War College was the back-to-back keynote presentations by leaders of two organizations that have already sequenced the largest number of whole-human genomes in the world.
Human Longevity Inc., of San Diego, was first to present. This presentation was followed by the 100,000 Genomes Project of the United Kingdom. HLI has already sequenced 25,000 whole human genomes. The 100,000 Genomes Project has sequenced about 8,000 whole human genomes.
Human Longevity, Inc., is a company established by J. Craig Venter, PhD, Peter Diamondis, and Robert (Bob) Hariri, MD, PhD. The company’s goal is to assemble the “world’s largest and most comprehensive database of whole genome, phenotype and clinical data.” It will use this data to “extend and enhance the healthy, high-performance lifespan and change the face of aging.” It will do this by solving “the diseases of aging” and by “changing the way medicine is practiced.”
In contrast, the 100,000 Genomes Project was organized by the National Health Service (NHS) of the United Kingdom. Its focus is on cancer and rare diseases and the goal is to use the knowledge gained from a study of the genome data base to create useful clinical care pathways that benefit UK patients.
Metabolome and Microbiome
“It is important to understand that HLI is working to combine information from the human genome with that of the metabolome and microbiome,” stated Brad Perkins, MD, Chief Medical Officer at HLI. “One primary tool we are using is machine learning in order to make sense of the huge amounts of data that are being generated.”
Perkins surprised the audience by describing the role of imaging, including MRI and DXA, as part of the data collected on individuals. “Among other things, we use this data to create an avatar of the individual. The avatar is then used by the individual to look at the different aspects of his or her health.
“Currently, our comprehensive service is priced at $25,000,” said Perkins. “For each individual, we are identifying a growing range of findings that are significant and/or actionable.”
100,000 Genomes Project
In the following keynote presentation, Sue Hill, OBE, PhD, Chief Scientific Officer for the National Health Service England, described how this program is establishing a national infrastructure to collect specimens, perform the sequencing, then store and analyze the data.
“The types of specimens collected for gene sequencing include formalin-fixed tissue, fresh frozen tissue, and blood,” stated Hill. “Typically these specimens come from patients with cancer or a rare disease, and their family members.
“In this current phase, researchers are focusing on these cancers: breast, prostate, colorectal, ovarian, lung, and CLL,” she continued. “Study is commencing on renal cancers and sarcomas.
“To make genetic medicine a reality, over the next 10 years the 100,000 Genomes Project will be fostering the development of resources such as a genomic laboratory infrastructure and centers of excellence while informing new pathways and models of care,” stated Hill. “A major goal is to apply whole-genome sequencing routinely in cancer and in other clinical conditions in support of a functional genomic pathway that is fully deployed, both in real-time care and also for monitoring.”
Taken collectively, the presentations of Perkins and Hill gave the audience a behind-the-scenes look at the rapid progress being made in whole-human gene sequencing and the interpretation of that data.
Regional Lab Network in NY
“For example, combined, the labs in the CLNY Alliance Network produce 34 million billable tests per year and have an operating budget in excess of half a billion dollars!” he exclaimed. “Through standardization and some consolidation, the JV is on track to deliver $40 million in savings to the partners in the next 30 months. It is also positioned to expand its market share of office-based physicians in the region.”
In fact, the Northwell Health lab division is at the front of the curve in using collaborations to advance its clinical mission in ways that also deliver substantial financial benefits. “Like all health system labs, we recognize the need to be at the cutting edge in molecular diagnostics and genetic testing to support population health management and personalized medicine,” noted Crawford.
“That raises a critical question: where does the lab get the capital needed to acquire state-of-the-art gene sequencing instruments?” he asked. “It is the classic ‘make or buy’ decision that confronts every lab that wants to offer a new test.
Partner for Genetic Testing
“Our decision was to partner with an organization that is already at the front edge of genetic testing and was willing to collaborate with us in ways that fully support our clinical mission to our parent health system,” noted Crawford. “We then spent almost three full years visiting potential partners, developing a request for qualifications (ROQ); then doing site visits of the respondents to the ROQ.
“Late last year, we wrapped up negotiations with our choice of a business partner,” he continued. “In January, we launched a shared genetic testing partnership with Bio-Reference Laboratories, Inc., of Elmwood Park, New Jersey.
“This is a limited liability corporation (LLC),” noted Crawford. “The master agreement for what we describe as a strategic alliance addresses several important issues. There is a Laboratory Service Agreement (LSA) that governs laboratory testing. It covers genetic counseling with test selection, test interpretation, and standard reporting requirements.
“For enhanced genomics, Northwell signs out the reports,” he added. “Other elements address genomic tumor boards, strategic teaching, the generation of data, who owns that data, and how market value will be defined.”
Crawford next discussed how the Northwell lab division is positioning itself to contribute to the further integration of clinical care. “Population health management and precision medicine both require labs to master information technology in sophisticated ways,” observed Crawford. “When lab data is combined with other types of clinical data, it becomes possible for pathologists, PhDs, and the lab team to collaborate with physicians in innovative and productive ways that directly benefit patients.
“One of our early successes with the use of enriched lab test data was in acute kidney injury (AKI), which is under-recognized and under-diagnosed,” he observed. “In a pilot program with one Northwell hospital, we instituted a ‘delta creatinine’ alert pilot program. Better use of this low-cost lab test helped to achieve earlier diagnosis of more cases of AKI.
“Not only did patient outcomes improve, but more accurate diagnosis and coding for AKI generated additional revenue of $2.7 million to Northwell in 2015,” said Crawford. “The AKI program is now being implemented systemwide.”