What’s Next For Regional Laboratory Networks?

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SINCE THE CONCEPT OF REGIONAL LABORATORY NETWORKS burst on the scene in 1995, I have ardently believed in their potential to help hospital laboratories remain relevant in the world of managed healthcare. The early victories of Pittsburgh’s Regional Laboratory Alliance and San Francisco’s Bay Area Hospital Laboratory Network inspired all of us.

Indeed, in 1995, 1996, and 1997 there was a flurry of activity throughout the United States to organize similar laboratory networks. But potential did not convert into reality. Pittsburgh’s network died two years ago. San Francisco’s network withered and barely clings to life. More attempts to organize a viable network have failed than succeeded.

With the hindsight of these years, I would like to point out a simple truth. The economic potential of a properly-designed regional laboratory network is unquestionable. Given this fact, I believe that the “regional lab network” movement is ending one market cycle and about to embark on another.

In this next market cycle, an emerging class of regional laboratory networks will become operational. They will be successful, because they studied and copied the handful of regional lab networks which got it right during the first market cycle. They will copy the best aspects of PacLab Network Laboratories in Washington; of Joint Venture Hospital Laboratories (JVHL) in Detroit; of Middle Tennessee Healthcare Network (MTHN) in Nashville; of Regional Laboratory Alliance in Kansas City; and other solid operational networks.

In the coming year, THE DARK REPORT will write about these networks. Like PacLab, they will blend the best of local commercial laboratory resources with those of participating hospital laboratories. They will incorporate modern business management methods into their operation plan. This new class of networks will go outside the laboratory industry for their executive directors, marketing managers, and sales people.

Most importantly, both the business design and the ongoing management of these regional laboratory networks will make them winners in their service area. As a local laboratory resource, this new class of regional laboratory network will provide competitive laboratory testing services to physicians and MCOs in their service area. In the process, this new class of regional laboratory networks will prove that the movement has come finally come of age.


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