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Laboratory costs and utilization: a framework for analysis and policy design

D F Hardwick, J I Morrison, J Tydeman

    Journal of Medical Education
    |April 1, 1981
    PubMed
    Summary

    Laboratory test ordering costs are escalating, impacting hospital budgets. A new conceptual framework helps analyze and control these complex laboratory systems to manage expenses effectively.

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    Area of Science:

    • Healthcare Management
    • Clinical Laboratory Science
    • Health Economics

    Background:

    • Laboratory test ordering is a complex system with significant financial implications.
    • Escalating costs of laboratory testing represent a substantial portion of overall hospital expenditures.
    • Effective management of laboratory resources is crucial for healthcare cost containment.

    Purpose of the Study:

    • To introduce a conceptual framework for analyzing laboratory test-ordering patterns.
    • To evaluate the input, process, and output phases of the laboratory inquiry system.
    • To provide a basis for developing cost-reduction strategies in laboratory services.

    Main Methods:

    • Development of a conceptual framework categorizing laboratory inquiry systems into input, process, and output phases.

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  • Analysis of contemporary Canadian data on laboratory test-ordering patterns and associated costs.
  • Evaluation of the escalating costs within the context of hospital financial structures.

    • Main Results:

    • Data indicate a significant escalation in the cost of laboratory testing.
    • Laboratory testing costs constitute a sizable proportion of total hospital costs.
    • The complexity of the laboratory inquiry system contributes to cost challenges.

    Conclusions:

    • A structured conceptual framework is essential for understanding and managing laboratory test-ordering patterns.
    • Policy interventions aimed at cost reduction require thorough analysis within this framework.
    • Sophisticated control programs at multiple levels of the laboratory system are necessary for effective cost management.