Standardizing Laboratory Services in an Integrated Health Network

July-August 2019 - Vol.8 No. 7 - Page #8
Category: Laboratory Information Systems
While laboratorians tend to be an introverted group, we all would all do well to face head on the external forces shaping the future of our labs. Three forces in particular—the reductions in the clinical laboratory fee schedule (CLFS), the current/impending clinical laboratory scientist (CLS) workforce shortage, and the increase in hospital and health system mergers and acquisitions are of particular concern to most clinical laboratories today.
To flourish as a laboratory while managing these and other external forces, hospital laboratories must remain nimble and continue to adapt. Standardization of some or all laboratory services across a health system is one adaptation that can provide significant benefits. At Norton Healthcare in Louisville, Kentucky, our health system has successfully completed several substantial strategic growth initiatives in the last two decades, and here we discuss our path to standardization, the advantages realized, and the challenges faced.

Approaching Standardization Over Time

Almost twenty years ago, Norton Healthcare continued its growth through the acquisition of three hospitals. With this acquisition came the question of how best to manage laboratory services in the newly expanded system. While the existing Norton hospitals at the time were serviced by a hospital-run laboratory, the acquired hospitals’ laboratories were managed by a commercial diagnostic laboratory. This led to two competing proposals: One to outsource all laboratory operations to the commercial lab, and the other to insource all laboratory services.

Ultimately, the clinical benefits and the potential for future growth and financial returns made insourcing all laboratory services the choice. Essential to this decision, particularly with regard to the potential for financial savings, was the standardization of laboratory services across the health system. This project involved an initial standardization of equipment, and the centralization of microbiology, immunology, and non-essential chemistry testing. These strategic and forward-thinking decisions made almost twenty years ago continue to yield substantial financial and clinical benefits to our health system today.

Offsetting External Forces

Standardization has allowed our laboratory services to thrive in spite of those external forces squeezing clinical labs: shrinking reimbursements, workforce shortages, and continued growth and service expectation. Without standardization, our laboratory would not have been as prepared to meet these challenges. Through standardization the laboratory has leveraged improved operational efficiency to meet the challenge of shrinking reimbursements. We realized substantial savings during the initial standardization process simply due to bulk purchasing power. Although the advantage of buying in bulk is something we all inherently understand, nonetheless, many labs within health systems continue to purchase small volumes of creatinine reagent, for example, from separate vendors.

Standardizing our laboratory instruments to the same vendor increased our volume commitment and lowered our per test cost. Over the long run, these per test cost savings have continued to pay dividends as our volumes have continued to grow (see FIGURE 1). Beyond the financial benefits, standardization enabled us to share reagents and supplies across system labs, helping to insulate operations from inventory shortages at any one site.

We also have realized financial savings from standardization via unexpected sources. When the laboratories began consolidating, a supply chain group was convened to evaluate and standardize the supplies used by the various sites. This included items as minor as pipette tips. By evaluating and selecting a single preferred supplier that was then standardized across the system, we were able to exercise leverage and reduce overall expenses. This supply chain group continues to meet regularly and evaluate new ways to optimize supplies cost, which has the overall effect of reducing per-test cost in our laboratory.

Evaluating New Technologies

It should be noted that the dwindling of cost-per-test reductions in recent years (see FIGURE 1) coincides with the introduction of new, more sophisticated and expensive technologies. In 2018, for instance, our laboratory sites introduced molecular flu testing to support the emergency department at each of our hospitals. While this testing added substantially to our laboratory costs, these costs were offset by continued improvements in our operational efficiency. Part of this was a benefit of being a standardized lab system; any single hospital laboratory budget would have been stressed with the addition of this testing, but the larger system was able to absorb the added cost.

Apart from financial benefits, molecular flu testing can provide substantial support to patient management.1 The addition of this testing allowed our laboratory to offer the service our clinicians need to provide the highest quality patient care. This introduction of molecular testing at each site illustrates that a standardized laboratory system does not need to be rigidly centralized. Sometimes the clinical demands justify the financial cost of decentralizing some testing. This, in many ways, represents exactly what a standardized, hospital-run laboratory should do: offer the highest quality clinical service in a fiscally responsible manner. This has been and continues to be the goal of our laboratory system.

Cross-Competency Staffing and Centralization

While the CLS workforce shortage is an ongoing threat to clinical labs, standardization of our health system laboratories has helped alleviate this issue. Since our laboratories use the same equipment and practice largely the same procedures, we are better able to maintain cross-competencies among our staff members. Thus, a CLS at one site can address a short-term, critical staffing shortage at another site practically at will. This ability to cover schedule gaps has helped prevent us from functioning at dangerous staffing levels and to avoid hiring temporary staff not familiar with the system or the laboratories’ workflow.

Furthermore, we have been able to reduce the workload and staffing needs across the system by centralizing non-essential chemistry testing (eg, vitamin B12, vitamin D, etc). This centralization means that only a single site needs to perform the work involved in maintaining this testing (ie, quality control, calibration, proficiency testing, six-month reportable range/comparability of methods, etc). Through regular courier runs between hospitals and 24/7 operation of the site performing the abovementioned work tasks, we are able to maintain excellent turnaround time.

Recent Standardization

The past 10 years have seen substantial growth in the health system and in the resulting laboratory volume. The addition of another hospital, five infusion centers, and an outpatient testing laboratory has highlighted the downstream value of standardization. For one, the purchase of additional instruments was accomplished with an amendment to an existing contract with our vendor. There was no need to draft an additional contract, saving substantial time and hospital resources. In addition, the laboratory information system (LIS) interface with existing-vendor instrumentation was straightforward and all of the relevant LIS parameters (linearity, critical values, etc) were already well-defined and built.

Finally, we were able to disseminate best practices to these sites in a codified manner. This is an oft-overlooked benefit of standardization; what one site learns about necessary quality practices can benefit all sites. As every laboratorian knows, there is no perfect vendor. Every vendor will inevitably have some instrument and/or assay issue that will challenge operations. The solution is for the laboratory to identify the issues specific to their instruments/assays and to implement quality systems that prevent those issues from causing inaccurate testing results. As a standardized system, we have multiple sites and CLSs training on and using a wide range of system instruments/assays, so if one site encounters an issue, it can be shared with the others, and in most cases, an existing quality system can be shared to manage that issue. As a result, from the moment our laboratory goes live at a new site, we already have a wealth of experience on the instruments we will be using.


While the benefits have greatly outweighed the negatives, standardization has come with some challenges. These include an increased vulnerability to issues with the contracted vendor, inefficiencies of addressing diverse patient populations, and patient-specific assay interferences.

As mentioned, there are no perfect vendors and every lab will eventually encounter an issue. Unfortunately, in a standardized laboratory system these issues can have a substantially greater impact. The ups and downs of your laboratory will be closely tied to the ups and downs of your vendor. While we have been fortunate to have good vendor partners, we have certainly encountered these issues. When a recall occurred, it meant that every site in our system was unable to report results for the impacted assay. Laboratories considering multi-site standardization need to carefully consider how they will mitigate these issues and should draft action plans and ensure their contract provides for vendor support in such situations.

A standardized laboratory operation also can struggle with the demands of meeting diverse patient populations. For example, what is considered a critical value at one site might not be considered critical at the other sites. The laboratory (and medical board) are then faced with deciding how to handle this: set all sites to call critical values at that level (with the associated lost operational efficiencies) or carve out an exception for individual sites. While lost operational efficiencies may appear to be the more critical factor, this has to be balanced against maintaining a culture that values and emphasizes standardization. Cultivating such a culture can be particularly difficult within a health system of newly acquired care sites.

Finally, patient-specific assay interferences can become an exacerbated problem in a standardized laboratory system. Take, for example, a patient with a human anti-reagent anti-body (HAAA, sometimes called a human anti-mouse antibody or HAMA). Since all sites in our system use the same reagents, this patient is susceptible to having inaccurate immunoassay results at every laboratory site in the system. This can be especially problematic, as providers may mistakenly believe that congruency of results across the systems suggests it is a real result.

Beyond individual issues, if good communication does not exist between the laboratory and health system clinicians, it is not uncommon for a clinician to check a suspicious result by having it measured at another site. This can prove disastrous, as the results will almost invariably confirm each other (given that each site uses the same reagents), which would lead to a false assurance that the inaccurate result is reliable. These situations demand the laboratory have wide and transparent lines of communication with both the clinicians and the systems in place to prevent releasing potentially spurious results for patients with known interferences (our laboratory utilizes patient-specific middleware rules for this purpose). While managing patient-specific interferences is a challenge for every laboratory, if left unaddressed in a standardized health system, they can become exponentially problematic.


While our laboratory has been on the path to standardization for some time, there remains a significant amount of work to be done. Standardizing laboratory instrumentation, operations, and workflow is not a once-and-done activity; rather, it requires continual effort and improvement. In a coming article, we will highlight ongoing standardization projects and provide recommendations for others considering undertaking this task.


  1. Soto M, Sampietro-Colom L, Vilella A, et al. Economic Impact of a New Rapid PCR Assay for Detecting Influenza Virus in an Emergency Department and Hospitalized Patients. PLoS One. 2016;11(1):e0146620. doi:10.1371/journal.pone.0146620 

Joshua Hayden, PhD, DABCC, FAACC, is the chief of chemistry at Norton Healthcare in Louisville, Kentucky. Prior to joining Norton, he was an assistant professor of pathology at Weill Cornell Medical College and director of the toxicology and therapeutic drug monitoring laboratory at New York Presbyterian Weill Cornell Medical Center. Joshua has special expertise developing and overseeing mass spectrometry assays in the clinical laboratory.

Kenette Pace, MT(ASCP), is the system director for laboratory services for Norton. She has been with Norton Healthcare most of her career in various positions from microbiology manager to central laboratory director to her current role as system director. Kenette also worked as the senior director for laboratory operations at Cincinnati Children’s Hospital.

Zora Pyevac, MT(ASCP), is the recently retired system laboratory director for Norton Healthcare. She began her career at Norton as a laboratory scientist and held multiple positions, including chemistry supervisor, assistant laboratory director, laboratory director, and ultimately, system laboratory director, before retiring in 2019.


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