Outsourcing of Academic Clinical Laboratories: Experiences and Lessons From the Association of Pathology Chairs...

American hospitals are increasingly turning to service outsourcing to reduce costs, including laboratory services. Studies of this practice have largely focused on nonacademic medical centers. In contrast, academic medical centers have unique practice environments and unique mission considerations. We sought to elucidate and analyze clinical laboratory outsourcing experiences in US academic medical centers. Seventeen chairs of pathology with relevant experience were willing to participate in in-depth interviews about their experiences. Anticipated financial benefits from joint venture arrangements often eroded after the initial years of the agreement, due to increased test pricing, management fees, duplication of services in support of inpatients, and lack of incentive for utilization control on the part of the for-profit partner. Outsourcing can preclude development of lucrative outreach programs; such programs were successfully launched in several cases after joint ventures were either avoided or terminated. Common complaints included poor test turnaround time and problems with test quality (especially in molecular pathology, microbiology, and flow cytometry), leading to clinician dissatisfaction. Joint ventures adversely affected retention of academically oriented clinical pathology faculty, with adverse effects on research and education, which further exacerbated clinician dissatisfaction due to lack of available consultative expertise. Resident education in pathology and in other disciplines (especially infectious disease) suffered both from lack of on-site laboratory capabilities and from lack of teaching faculty. Most joint ventures were initiated with little or no input from pathology leadership, and input from pathology leadership was seen to have been critical in those cases where such arrangements were declined or terminated.