May 7, 2018 Intelligence: Late Breaking Lab News

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In Sebastopol, Calif., the financially-troubled Sonoma West Medical Center (SWMC) dropped a controversial drugs-of-abuse testing program. The following month, without the revenue from the drug testing program, 37-bed SWMC lost $1.4 million. In 2017, the hospital entered into a pass-through billing arrangement with a Florida attorney, Aaron Durall and his lab company, Reliance Laboratory Testing. Earlier this year, SWMC received a letter, dated Jan. 9, from health insurer Anthem demanding repayment of $13.5 million that the insurer had paid the hospital for urine drug test claims. (See TDR, March 5, 2018.)

MORE ON: Sonoma West

In its letter to Sonoma West Medical Center, Anthem described the pass-through billing arrangement (sometimes called “hospital outpatient department”–HOPD) involving Durall and Reliance. It threatened legal action and demanded repayment of the $13.5 million. On March 28, in a separate lawsuit filed in Georgia involving urine drug testing, pass-through billing, and Aaron Durall, Anthem sued him and other individuals, several lab companies, and two small Georgia hospitals.


On April 16, MAWD Pathology of Kansas City announced its acquisition of the local Cytocheck Laboratory. As a subsidiary of MAWD, Cytocheck provides technical pathology, cytology, and laboratory services. MAWD provides professional pathology services for both entities.


  • PathGroup of Nashville, Tenn., appointed Randal Sanderson as its Vice President of Business Development. Sanderson previously held business development positions at McKesson (now Change Healthcare) and PSA, LLC.
  • Neogenomics, Inc., of Ft. Myers, Fla., announced that William Bonello was its new Vice President, Treasurer, and Director of Corporate Development. Bonello’s prior experience includes working at: Craig Hallum Capital Markets, RBC Capital Markets, Laboratory Corporation of America, Wachovia Capital Markets, and Piper Jaffray.
  • Pathologist Elaine Jeter, MD, retired as Director of MolDX at Palmetto DBA. She is forming her own consultancy.

That’s all the insider intelligence for this report.
Look for the next briefing on Tuesday, May 29, 2018.

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…how and why some hospitals are starting concierge care clinics, where patients pay a regular fee to have frequent access to physicians. Hospitals say these clinics are a necessary way to increase revenue and serve their local market.

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