Way back in 2018, mergers of healthcare systems and laboratories were in full swing. Once the COVID-19 pandemic made landfall in the United States, American healthcare was consumed by finding testing, treatments, ICU beds and ventilators. Today, many feel that, with the available vaccinations, treatment options and continued research, this pandemic may be manageable by the end of 2022. In preparation for “the light at the end of the tunnel”, right now maybe the time to consider a strategic plan to join another healthcare system, create your own integrated laboratory or hospital system, or even build your own system reference laboratory. If you are considering such an endeavor, please allow us to guide you through a few strategic touchpoints Alverno Laboratories has learned along our integration path.
Alverno Laboratories as an Integration Partner
Alverno Laboratories began its journey as an integrated laboratory in 1999. Along the way, our team has learned how to successfully integrate health care laboratories into our system and how to avoid certain pitfalls. During Alverno’s multiple integrations, now spanning over 20 years, we identified several areas that should be considered prior to moving forward with a laboratory integration to ensure a successful transition.
First Things First
One of the most important considerations in creating any type of system is to identify and define your vision of the organizational culture. This task is made more difficult if separate systems are joining together as a conflict of cultures will most likely occur. Which culture will win? How do you blend two cultures into one? Failure to define your vision of the new culture will yield a strong possibility that employees and leaders alike will create a new culture for you- one that may not suit your ultimate goals. We have found that meeting with all employees to identify what a successful corporate culture embodies to them helps create focus and alignment. Coupling those results with a focus on patient care will allow the newly formed team to have a common, unified vision of what the new company wants to accomplish. Throughout the entire integration, transparency is a must! If big decisions are made, it is best to share them prior to implementation to allow all individuals involved to process what the expectations will be moving forward.
While the primary consideration for most healthcare systems is financial, the benefits of the complex process of integrating laboratories can go far beyond the financial implications. A large disruption will occur when implementing such a large project; using the disruption to implement standardization across human resources, billing, compliance, policy retention, competency management and courier services should be strongly considered before starting the integration. Prior to any action, clearly defined goals of your integration must first be established to help focus the project. A common pitfall is identifying additional goals mid integration that can extend the project past the original timeline and require buy-in once again.
One of the most important and first goal should be is to identify the structure of your laboratory system. Before you decide if a centralized reference laboratory is the most beneficial for you, meet with clinical and medical staff to establish the rapid response or time dependent test menu for each hospital. These test menus will allow you to identify the non-time dependent testing that can (a) a new reference laboratory you create, (b) move this testing to your largest hospital laboratory, or (c) partner with an established reference laboratory. With this knowledge, making the decision will be more successful. When looking at the test menus, remember the key is not to reduce service levels but to strive for improved service and care. If you chose option (a), you will need to identify which tests create a high enough volume to bring in-house. Integrating laboratories allows you to expand the reference lab test menu which often positively impacts the bottom line. Another goal should be to standardize equipment, policies and procedures, as well as personnel management, across the new system. While this is often a component that is overlooked in the beginning, utilizing economy of scale and offering options to share reagents and personnel across sites can be very valuable clinically and financially. Standardization does require financial support leading to dependency on the overall financial health of the organization and may require a long-term planning process tied to resource availability. Through its multiple integrations, Alverno identified excellent vendor partnerships to accomplish many standardizations and we have much knowledge to share. Don’t underestimate the power of standardization- the sooner you can get there the better.
Remember Who is Affected
Although you may only consider the most senior leaders of the involved organizations as stakeholders, laboratory consolidations affect medical directors, pathologists, and staff at all levels. It is prudent to consider the impact integration will have on each of these populations; identifying this group of stakeholders in your specific situation is essential. Defining desired outcomes that benefit the community and your laboratory at as many levels as possible will help address the potential concerns of stakeholders and may help you alleviate any backlash that could arise. While you will not eliminate everyone’s concerns and fears, you will be able to gather a greater level of support down the road. Further, including as many of these stakeholders as possible in the design phase will create team buy in and lead to ‘champions’ of the project who will aid in encouraging others to support the integration. As the senior decision maker, the more transparent you can be to the entire team the better- surprises once implemented are difficult to manage. When defining your ‘systemness’, it is essential that your reference laboratory is considered an equal to the hospital laboratories. Each has a specific function and is essential to the success of the system.
Information system implications vary considerably dependent on the number of IT solutions in place. In regards to Alverno’s experience, our IT system encompasses connecting five different Laboratory Information Systems (LIS), yielding an extremely high complexity. If you are integrating owned hospital laboratories within your system that utilize a single common LIS, IT may not provide a big obstacle as along as everyone is using the same solution and same database. However, if you are adding or creating a reference laboratory in your laboratory integration strategy, EMR connectivity and added cost needs to be considered. Remember to ensure that the LIS you choose can accommodate large testing volumes and can support growth through test additions as well as Pathology, Histology, and Cytology. Mapping out how testing samples, and information will flow back and forth, is an imperative part of the process.
So if it’s a go, what’s next?
If the decision is made to move forward with an integration, having a proven project management solution is a must. Your clearly defined goals and desired outcomes can only be accomplished if the project moves forward with as few deviations as possible. Although leaders in your organization may be skilled managers, you will find that integration is too large for any single individual who has other responsibilities. Alverno Laboratories partnered with Integrated Project management Company, INC. (IPM) and was rewarded with a smooth integration because the IPM team’s sole focus was keeping the project moving forward correctly and in a timely fashion. The value of project management cannot be overemphasized as these are highly complex projects with many layers. A strong project management team such as IPM, will yield a successful project, while allowing your organization to continue providing exceptional patient care.
A separate, but imperative, focus is managing change. Hospital laboratories will experience a reduction in test volume, while the opposite will occur at your identified central laboratory. Inherently, laboratory teams have been groomed to believe that growth in volume equals success, meaning that moving to an acute care test menu will feel like a giant step backwards to your staff. While the central laboratory may experience growing pains and staffing shortages, the reduction of the test menu at the hospital sites may cause staff to feel that their job security is threatened. Change management must address these concerns proactively and quickly. The messaging around change should emphasize that it is occurring to best serve the patient and the community, not to harm employees. Although positions may move from the hospital setting to the central laboratory, being creative yet honest in communicating these changes will go a long way in garnering their acceptance. Alverno found that some techs who had considered retiring but hadn’t found the right time to do so, took this opportunity leading to a shift in seniority that had a positive effect on the remaining staff.
Let say it’s a perfect world. You have done everything right; great project management and change management, you believe all parties involved agree on the top premises you want to accomplish, and leadership believes that transparency and communication of a key executive message will create and foster alignment. However, often in consolidation and integration, alignment of stakeholders is rarely present at the early stages. The reality is that often there is much buy-in but the dirty secret is that for some, alignment never occurs. Depending on where the misalignment is taking place, the negative impact could create barriers to success. There is a critical need for leaders to recognize the disconnect that may occur through different departments across the organization and develop mechanisms to manage the impact or disruption. While it is often difficult, what is most important is to stay the course and to not let the project veer off path.
Although we are always looking to have new members join our cooperative, we feel it is our duty to impart our knowledge with the laboratory community by sharing our insights. Our hope is that you enjoyed our thoughts and the perspective shared here on laboratory integration and have found this article helpful. If you desire to discuss our consulting services, we hope you will reach out to us. Alverno Laboratories’ leadership enjoys discussing all things laboratory and integration. Feel free to drop us a line and tell us a bit about you via our website https://alvernolabs.com/integration-services/. We look forward to having you join us in a conversation today!