“May 12, 1997 Intelligence: Late Breaking Lab News”

Beth Israel Medical Center in New York City is throwing a coming out party for their automated laboratory. Beth Israel is producing a two-day seminar on May 18-19 to demonstrate all aspects of their “totally automated core facility.” It was Carl Teplitz, M.D. who championed the automation project. He is Chairman of the Department of Diagnostic Pathology and Laboratory Medicine at Beth Israel.

The two-day seminar includes a presentation titled “ Cost-Benefits and Outcome Analysis. ” If it is a candid and detailed summary of the real costs incurred to automate compared with the actual cost savings and productivity gains which were realized, then it would probably be the first honest look at the economics of laboratory automation. That would be invaluable for the laboratory industry because such numbers have not been readily available.


Apparently some ex-clinical laboratory executives joined Chicago-based Physicians Laboratory Management Company (Phylab) with the goal of acquiring physician office laboratories. That seems like a strange strategy at a time when lab reimbursement is declining and the regulatory burden on labs is about to become onerous.

Good news for those who believe Medical Savings Accounts (MSAs) may be the the way to restore consumer choice to healthcare. According to the Wall Street Journal, MSAs “are off to a roaring start in the private insurance market.” Estimates are that 100,000 policies may have already been written since Congress authorized the program last summer. Demand is so strong that large insurers such as American Community Insurance, Time Insurance of Milwaukee and even some Blue Cross / Blue Shield companies are rushing MSA products to the market.

On April 22, Physicians Clinical Laboratories (PCL) in Sacramento issued a press release reporting that their Chapter 11 bankruptcy reorganization was approved by the court. Although this may be a positive step for the executive team, THE DARK REPORT believes that lenders such as Oak Tree Financial will insist that PCL be tightly managed. If PCL were to encounter further setbacks, the lenders may insist on radical changes to management.

Oak Tree Financial may become the key player in California’s commercial laboratory marketplace. Not only does Oak Tree hold a significant chunk of PCL’s debt, but during the second half of 1996 it purchased a sizeable portion of Unilab’s debt. If Unilab were to violate debt convents, Oak Tree would be in a position to restructure Unilab. Many observers feel that Oak Tree’s ultimate goal is to wait for that event, then cause a merger of Unilab and PCL. Were that to happen, it would drastically change the way laboratories compete in California.


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