Ibex To Focus On U.S. Market For AI-Assisted Pathology

by Jondavid Klipp | Oct 15, 2021 | Artificial Intelligence, Ibex Medical Analytics

Ibex To Focus On U.S. Market For AI-Assisted Pathology

Ibex Medical Analytics (Tel Aviv, Israel and Boston, MA) has hired Douglas Clark, MD, as its Chief Medical Officer, Americas. Ibex also announced that Joseph Mossel, its co-founder and CEO, is relocating to the United States to lead the company’s expansion in North America from its Boston headquarters.

Prior to joining Ibex, Clark was Chief Medical Officer at TriCore Reference Labs (Albuquerque, NM), where he led the transition to digital pathology. Before that, Clark was Chair of the Department of Pathology at the University of New Mexico School of Medicine and was previously Professor of Pathology and Oncology at The Johns Hopkins Medical Institutions.

Ibex develops AI algorithms and digital workflows that help detect and grade cancer in biopsies. The company’s AI-powered Galen algorithm is currently being used by CorePlus Services in Puerto Rico (see LE, September 2020) and Alverno Clinical Labs in Indiana (see LE, August 2021).

Earlier this year, Ibex’s Galen platform was granted Breakthrough Device Designation by the FDA, which will help fast-track clinical review and regulatory approval.

Ibex raised $38 million from a Series B financing private equity round in March. Lead investors included Octopus Ventures and 83North, with additional participation from aMoon, Planven Entrepreneur Ventures and Dell Technologies Capital, the corporate venture arm of Dell Technologies. Ibex has now raised a total of $52 million since its inception in 2016.

Tips For Negotiating Your Lab’s Next Reference Testing Contract

by Jondavid Klipp | Oct 15, 2021 | CLFS, Laboratory Economics, Laboratory Market Research, Reference Testing

Tips For Negotiating Your Lab’s Next Reference Testing Contract

Reference (aka send-out) testing expenses average between 5% and 10% of the overall budget at most hospital laboratory departments. “Everybody thinks they are getting a good deal, but most have not wrung out the lowest prices available from their reference lab,” notes Steve Mattice,
President of the hospital lab consulting firm J.A. Mattice & Associates (Portland, OR). Below we highlight some of Mattice’s key tips and observations.

What’s the “hot list” in terms of send-out tests?
This is the list of 10 to 100 higher-volume send-out tests that the big reference labs (ARUP, Labcorp, Mayo and Quest Diagnostics) will discount the most in order to win a contract. But it’s a diversion because they offset their lower prices on the recognizable tests with much higher prices on lower-volume send-out tests. Each of the major reference labs is most focused on the overall profitability of their reference testing contracts.

How can hospitals negotiate for the best overall reference testing contract?
The key is knowing the lowest price that the major reference labs are willing to provide for each specific send-out test. We have helped negotiate more than 100 reference testing contracts over the past 30 years and have maintained a database of the lowest prices we have found for send-out tests from the four largest reference labs. Every time we find a lower price for the same test code, we keep track of it, and it becomes our new standard price for negotiations. When negotiating a new send-out testing contract, we will typically analyze the total annual costs for all send-out tests at a hospital client.

What kind of pricing variation is there?
There is a wide variation (see table). For example, we have found that some hospitals pay their reference lab as little as $9 for Lyme Disease Antibody tests (CPT 86618), while others pay as high as $101. It’s not like shopping at the supermarket where you can easily compare prices. In reference testing, like most of healthcare, nobody knows what the other guy is charging.

What kind of savings are you typically able to achieve?
Historically, we have averaged in the range of 23% to 27% savings for each new three-year reference testing contract. However, over the past year, labs have begun to experience inflationary pressure on wages, reagents, paper supplies, courier services, etc. As a result, we’ve started to see the big reference labs draw a harder line on pricing.

Have there been any new entrants in reference testing to challenge the “big four?”
There are a handful of large health systems and academic medical centers competing on a regional basis and Sonic Reference Laboratory has been making some inroads into the market over the past few years.

Cancer Diagnoses Declined Sharply During First Year of Pandemic

by Jondavid Klipp | Sep 15, 2021 | COVID-19, Quest Diagnostics

Cancer Diagnoses Declined Sharply During First Year of Pandemic

New diagnoses of eight common cancers (prostate, breast, colorectal, lung, pancreatic, cervical, gastric and esophageal) significantly declined during most of the first 13 months of the pandemic (March 2020-March 2021), according to a study by Quest Diagnostics published August 31 in JAMA Network Open, Oncology. It is believed to be the largest and most comprehensive analysis of cancer diagnosis rates during the pandemic.

Lockdown measures and fear of going to doctor’s offices and hospitals are believed to have led many people to put off preventative care like routine screenings that could have resulted in diagnosis of cancer during the first year of the pandemic, the study suggests.

The Quest study included 799,496 patients (45% women/55% men) with an average age of 68. Data over four time periods was analyzed: prepandemic, March to May 2020, June to October 2020, and November 2020 to March 2021.

Prepandemic, January 2019 to February 2020, the average monthly number of new diagnoses for the eight cancers was 32,407. During March to May 2020, the monthly average fell by 30% to 22,748 cases. It fell by 10% to 29,304 cases in the next period, June to October 2020. Finally, new cancer diagnoses fell 19% to an average 26,204 cases in the last period, November 2020 to March 2021.

Delayed cancer diagnosis can lead to more advanced disease, more aggressive and costly treatment, and worse outcomes, noted the Quest study.

ACLA Study Cites Emerging Crisis of Undiagnosed Diseases and Delayed Treatment
A separate study of Medicare claims data found that clinical lab test utilization overall fell by 18% from 2019 to 2020, even when taking into account the large volume of Covid-19 testing conducted in 2020. The study was sponsored by the American Clinical Laboratory Association and performed by Braid Forbes Research (Silver Spring, MD). The analysis compared the volume of CLFS tests for Medicare beneficiaries in the first nine months of 2020 to the volume of tests performed in the same period of 2019. Key findings included:

Cancer testing decreased by 31% on average across key tests, including:

• EGFR test volume for non-small cell lung cancer fell by 47%
• BRCA test volume for breast and ovarian cancer fell by 35%
• Prostate specific antigen (PSA) test volume fell by 16%

Diabetes testing decreased by 29% on average across key tests, including:

• A1c test volume fell by 20%
• Glucose test volume fell by 36%

Other tests seeing substantial volume declines included chronic kidney disease (-31%), liver disease (-23%), lipid panel (-22%) and drug testing (-21%).

The Pandemic Intensified Chronic Lab Worker Shortage

by Jondavid Klipp | Sep 15, 2021 | American Society for Clinical Pathology, COVID-19

The Pandemic Intensified Chronic Lab Worker Shortage

There are approximately 338,000 clinical laboratory technologist and technician jobs in the U.S., according to the U.S. Bureau of Labor Statistics. Hospitals account for 47% of these jobs; independent labs, 20%; physician offices, 9%; schools and universities, 6%; and other settings, 18%. While the Covid-19 pandemic has increased the visibility of the clinical lab industry, it has also intensified the chronic shortage of lab workers. A new report (The Clinical Laboratory Workforce: Understanding the Challenges to Meeting Current and Future Needs) published by the American Society for Clinical Pathology (ASCP) and the Center for Health Workforce Studies at the University of Washington, provides an in-depth look at the lab worker shortage and strategies to increase the pool of qualified personnel. For more insight, Laboratory Economics spoke with the study’s lead author Edna Garcia, MPH, Director, Scientific Engagement and Research at ASCP.

How has the pandemic worsened the lab worker shortage?
It’s made it difficult for students studying medical laboratory science to get onsite at clinical rotation sites. Many sites didn’t want students due to Covid-19, and some programs turned away students weeks before they were scheduled to start rotations. As a result, the pipeline of new histotechnicians, medical laboratory technicians and phlebotomists entering the workforce has been disrupted.

There were steep declines in the number of new histotechnicians, histotechnologists, medical lab technicians and especially phlebotomists last year [see table].

At the same time, labs have experienced higher-than-average staff departures mainly due to early retirement taken by employees with health concerns. Some lab employees in the age range of 55-64 have retired early because of burnout and/or fear of catching Covid.

Finally, there has been increased demand for lab workers due to the high volume of Covid-19 testing, demand for rapid turnaround time, and the thousands of new Covid-19 testing labs that have

What’s your take on the high sign-on bonuses being used to attract lab workers?

For more than 20 years, labs have competed for workers by offering sign-on bonuses. What’s new is the size of the bonuses, which have increased from roughly $1,000 to $5,000 in the past, to as much as $10,000 to $20,000 currently. Labs are also now frequently tying sign-on bonus payouts to required employment of two years or more to prevent “lab jumping.” We’ve also seen institutions that offer to pay for licensure fees, discounts on car/homeowners insurance and cellphones.

Which positions are in highest demand?
Medical lab technicians, histotechnicians, and phlebotomists have the highest vacancy rates. We also see many opportunities in molecular pathology departments, and the need for technologists with molecular biology (MB) and molecular pathology (MP) certifications.

The long-term trend in new clinical laboratory science program graduates is flat.
Yes, the total number of new graduates for all lab degrees (HT, HTL, MLS/MT, MLT, etc.) has been stable for the past 10 years (see chart). But stable isn’t good enough to keep up with the growing demand.

Will increasing technology and automation alleviate the worker shortage in the lab?
From our data and conversations with lab staff and managers, the role of lab professionals is going to change with automation, but it’s not going to reduce the number of techs required. There will be a need for staff who are knowledgeable in using and operating these machines in the near future.

What can be done to increase the pool of qualified personnel?
Our report outlined three strategies. Number one, we’ve got to raise awareness of lab career opportunities at an earlier age. Specific activities and program content geared toward elementary and middle school students are needed. Incentives should be offered to encourage lab employees to participate in educational and awareness-building activities at elementary schools.

We’ve also got to do more to improve workforce retention. Too many lab employees leave the field to pursue new careers by enrolling in nursing or medical school. We need to keep existing employees by providing more opportunities for career growth through tier levels, increases in pay, and
elevated titles.

Finally, we’ve got to encourage diversity in academic recruitment by partnering with STEM programs to recruit students from underrepresented groups, developing more scholarships, and recruiting more men, the non-dominant gender in this field.

New Law For Medi-Cal Aimed At Eliminating Retroactive Recoupments

by Jondavid Klipp | Aug 15, 2021 | Laboratory Regulations, Medi-Cal

New Law For Medi-Cal Aimed At Eliminating Retroactive Recoupments

On July 27, California Gov. Gavin Newsom signed a comprehensive health care budget trailer bill (AB 133), which prevents future retroactive reimbursement reductions and recoupments from labs and pathology groups that occur due to “a lack of timeliness in Medi-Cal updating their rates.” In the past, Medi-Cal fee schedule rate changes have been chronically delayed, which has often led the program to seek retroactive recoupments from labs and pathologists—a major administrative and billing headache.

In addition, the new law has made a minor adjustment to the methodology used for setting MediCal fee schedule rates for clinical lab tests and pathology services. Beginning on July 1, 2022, Medi-Cal rates will be based on the lowest of the following: 1) the amount billed; 2) the charge to the general public; 3) 100% of the lowest maximum allowance established by the federal Medicare program for the same or similar services; or 4) a reimbursement rate based on an average of the lowest amount that other payers and other state Medicaid programs are paying for similar clinical laboratory or laboratory services.

The California Department of Health Care Services (DHCS) will not adjust rates currently established on the Medi-Cal fee schedule that do not exceed the limitations mentioned above, according to a DHCS spokesman. Some labs and pathologists had hoped the new law would raise their Medi-Cal rates to 100% of Medicare rates next year, but it does not.

The DHCS spokesman confirmed that the DHCS will continue to conduct its triennial rate survey and adjust rates based on the average of the lowest amounts third-party payers are paying. The next rate survey will be based on third-party payer data collected from calendar year 2021, reported in 2022 and effective in July 2023.