News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

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News, Analysis, Trends, Management Innovations for
Clinical Laboratories and Pathology Groups

Hosted by Robert Michel
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UnitedHealth Group’s MedExpress and Walgreens Boots Alliance Initiate Pilot Program to Put Urgent Care Centers in Walgreens Pharmacies

Clinical laboratories should prepare to receive test orders from these mini-medical centers, based on consumer demand for quick, inexpensive, local healthcare

Is the era of clinical laboratory testing offered in retail stores soon to arrive? Dark Daily as long as 10 years ago predicted that walk-in clinics featuring a nurse or nurse practitioner who could diagnose and prescribe for a limited number of health conditions—which had a remedy that could be purchased at the pharmacy in the retail store—would be the door-openers to locating more sophisticated clinical services in retail settings.

Since then, we’ve covered many such openings—including free standing urgent care clinics opening in urban settings to service the consumer demands of busy patients—which have impacted clinical laboratories and anatomic pathology groups in predictable ways.

Late last year, UnitedHealth Group’s MedExpress and Walgreens Boots Alliance (NASDAQ:WBA] announced a joint pilot program to open urgent care centers attached to Walgreens stores.

The premise of the collaboration was based around the belief that consumers would welcome the opportunity and benefits of receiving basic healthcare services in a facility located next to a pharmacy. The Walgreens/MedExpress agreement, however, also indicates that two of the largest healthcare organizations in the world believe consumers would also be interested in visiting physicians who provided more sophisticated medical services, including critical care, in retail settings.

To date, Walgreens has opened MedExpress clinics in 15 locations in six states, including: Minnesota, Nebraska, Nevada, Texas, Virginia, and West Virginia. More such clinics are expected to open this year as part of the collaboration.

“MedExpress is a resource for busy families and employers that need timely access to affordable, high-quality healthcare close to home and work,” Fred Hinz (above), VP of Operations at MedExpress told Drug Store News. “Being connected to Walgreens will enable our patients to receive quality care and purchase any other items they need, all in one trip.” It also will likely result in increased orders for clinical laboratory testing from retail locations. (Photo copyright: Grand Island Independent.)

Future Health System Delivers Critical Care from Retail Locations

Motivated by consumer demand for convenient, high-quality healthcare, the urgent care market in the United States continues to grow. This trend will eventually influence clinical laboratories and anatomic pathology groups seeking to service these providers. It will be a dynamic market as new participants and mergers compete for leverage in this profitable business.

“This is just part of developing an overall higher-performing local health system,” Forbes reported UnitedHealth CEO David Wichmann telling analysts during the company’s earning call last month. “It’d just be one component that may be nested inside a local care delivery market with ambulatory surgical capacities and house calls and things of that nature. This is the future health system that we see delivering considerable value to people.”

The speedy growth in the number of and profitability of urgent care centers is another confirmation that this healthcare trend has legs. And experts believe the growth will continue and accelerate.

A recent report by market research and consulting firm MarketsandMarkets (MnM) predicts the global urgent care market should reach $25.93 billion (US) by the year 2023. The current value of the industry is $20 billion. The growth rate for the industry is expected to be 5.3% with North America being the region accounting for the highest amount of that growth.

The MnM report attributes the rise in the urgent care market to many factors, including:

  • Growing investments in urgent care;
  • Strategic developments between urgent care providers and hospitals;
  • Access to affordable care;
  • Convenience of shorter wait times; and,
  • Increase in the geriatric population.

The report projects that the biggest hurdle facing the urgent care industry will be the lack of a skilled workforce.

Urgent Care a Growth Industry According to Experts

There are currently more than 7,500 urgent care facilities in the United States, according to an Urgent Care Association (UCA) white paper.

According to the UCA, the top six urgent care organizations in the US each have more than 100 locations. Those companies include:

A 2017 UCA benchmarking report states that only 3% of patients who are seen at an urgent care facility were diverted to an emergency room in 2016. The top diagnosis codes for visits during that year were:

  • Acute upper respiratory infection;
  • Unspecified acute sinusitis;
  • Acute pharyngitis;
  • Cough; and,
  • Fever.

A report by Becker’s Hospital Review states that urgent care visits account for 19% of all healthcare visits in the US.

Urgent Care Centers Badly Needed and Highly Profitable

Last year, strategy consulting firm Health Systems Advisors (HSA) commissioned a study regarding the current and future need for urgent care centers. According to Becker’s Hospital Review, the HSA study stated that:

  • “With the recent rise of urgent care development, there is an estimated 22% unmet need for urgent care in markets where urgent care sites could be financially viable;
  • “The unmet demand is so large that approximately 1,600 new urgent care sites can be supported generating nearly $3.5 billion in revenue; and,
  • “For health systems seeking to grow, the urgent care channel presents a unique opportunity to grow their revenue, influence patients’ downstream choices, and create a better experience for individuals desiring more convenience and better access.”

And data collected by FAIR Health indicates that, between 2007 and 2016, insurance claims for urgent care visits grew by a whopping 1,725%! Claims for emergency room visits increased by 229% during the same time period. FAIR Health is a non-profit organization that examines insurance claims for medical services for the purpose of bringing transparency to healthcare costs and insurance information.

Opportunities for Clinical Laboratories to Support Physicians

Clinical laboratories and pathology groups should pay attention to the burgeoning trend in urgent care, as those facilities order medical tests that will require processing, reading, and analyzing.

Exploring opportunities to serve urgent care centers offers clinical laboratories potential revenue streams and opportunities to serve the physicians practices and medical communities they support.

—JP Schlingman

Related Information:

UnitedHealth, Walgreens Partner to Put Urgent Care Next to Pharmacies

Report: MedExpress, Walgreens Pilots Grow to 15 Locations

Urgent Care Center Market by Service (Acute Illness Treatment, Trauma/Injury Treatment, Physical Examination, Immunization and Vaccination), Ownership (Corporate Owned, Physician Owned, Hospital Owned), and Region

Urgent Care Center Market on Track to Hit $26B by 2023

Urgent Care Industry Hits $18 Billion as Big Players Drive Growth

Health System Growth Using Urgent Care

20 Things to Know About Urgent Care

Top Urgent Care Organizations by Number of Centers

The Essential Role of the Urgent Care Center in Population Health

Patient Expectations Driving Growth in On-Demand Care

Urgent Care Centers: US Market Research Report

Consumer Trend to Use Walk-In and Urgent Care Clinics Instead of Traditional Primary Care Offices Could Impact Clinical Laboratory Test Ordering/Revenue

 

 

Consumer Trend to Use Walk-In and Urgent Care Clinics Instead of Traditional Primary Care Offices Could Impact Clinical Laboratory Test Ordering/Revenue

Primary care is shifting from traditional office visits to urgent care and walk-in clinics even as large hospital groups continue to buy up independent physician practices, altering where and from whom clinical laboratories receive referrals and test orders Medical test ordering and referrals from office-based physicians are the financial foundation of the clinical laboratory industry. Thus, recent trends reshaping how and where physicians practice medicine, and the ownership of their medical...

UnitedHealth’s Plans to Build More MedExpress Urgent Care Centers Is a Sign of Strong Consumer Demand and Could Be an Opportunity for Clinical Laboratories

Since the first retail clinic opened in Minneapolis in 2001, there has been a steady increase in the number of such clinics, typically located in retail pharmacies and chain retailers

In Minnesota, UnitedHealth Group (NYSE:UNH) is preparing to substantially increase the number of urgent care clinics it operates in the state. These retail-style clinics will be operated by MedExpress, a company that UnitedHealth acquired in 2015.

UnitedHealth’s decision to expand the number of MedExpress retail clinics it operates, both in Minnesota and nationally, is a sign to clinical laboratory managers and pathologists that consumer demand for health services delivered by a retail clinic continues to increase. (more…)

Minnesota Hospitals in Financial Crisis as State’s Healthcare Systems Record Hundreds of Millions of Dollars in Losses

Nationwide, hospital losses are in the billions of dollars, which affects access to medical care including clinical laboratory testing

Hospitals and health systems across the United States continue to report substantial financial losses. At some institutions, this might severely restrict access to physicians and clinical laboratory testing for patients in those areas. The latest state to announce its hospitals were in trouble is Minnesota. The Minnesota Hospital Association (MHA) announced its hospitals are in “financial crisis” revealing that the state’s health systems experience hundreds of millions of dollars in operating losses annually.

The MHA stated that two out of three surveyed hospitals in Minnesota reported losing money in the cumulative amount of more than $400 million during the first half of 2023, KARE 11 reported. The MHA surveyed more than 70 health system members which represented facilities of all sizes and in all geographical regions of the state.

Rahul Koranne, MD, President and CEO of MHA told KARE 11 that part of the problem is that a larger proportion of patients rely on federal programs such as Medicare and Medicaid to pay hospital costs. Those programs provide lower reimbursement rates when compared to private insurers. In some facilities, almost 75% of patients are on one of these government programs. 

“Those reimbursements, or payments, are fixed. So, we can’t raise prices. These two programs are paying significantly below the cost of providing care to our patients,” he noted. “So, if you have 70% of your patients covered by these governmental programs, we can’t raise prices, and they’re paying you below the cost of care—that’s what causes [the problem].”

He went on to state that workforce staffing represents a significant challenge for hospitals and urged the state legislature to address the needs of health professionals and facilities. 

“We need to really resource it in this upcoming session and many sessions to come, so that we can have workers and staff we need,” Koranne said. “If we don’t have the money, and if we don’t have the workers, we will not be providing care and that would be sad.”

Rahul Koranne, MD

“This is a pretty grave state and, I would say, quite a crisis,” Rahul Koranne, MD (above), President and CEO of the Minnesota Hospital Association, told KARE 11. “Our not-for-profit hospitals and healthcare systems are hanging dangerously from this cliff and they’re getting tired.” Access to medical laboratory testing can be greatly affected by hospital financial losses. (Photo copyright: Twin Cities Business.)

Other US Healthcare Systems in Crisis as Well

Minnesota is not the only state with healthcare systems in financial crisis. Last year, the Washington State Hospital Association (WSHA) announced that hospitals in that state reported cumulative losses of $2 billion for 2022. Cassie Sauer, President and CEO of WSHA told the media that the massive deficits are “clear and incredibly concerning” to the state’s healthcare leaders.

In “Hospitals, Pharmacies Struggle to Be Profitable,” we reported that the WSHA survey determined that the state’s hospitals suffered collective operating losses of $750 million during the first six months of 2023.

“The financial losses that our hospitals are experiencing continue to be enormous,” Sauer told The Seattle Times. “Revenues simply are not keeping up with rapidly escalating costs. It’s most concerning as these large losses are putting patient care at risk in many communities across the state.”

The WSHA findings were based on a survey of 81 acute-care hospitals that represented about 98% of the state’s hospital beds. Of those facilities, 69 reported losing money mostly due to rising costs for supplies, labor, and other expenses as well as the need for longer hospital stays due to more complicated care and a larger percentage of patients on government programs, which offer lower reimbursement rates for care. 

“When hospitals are not financially viable and over time sustain heavy losses, you must either increase revenue or reduce healthcare services,” Chelene Whiteaker, Senior Vice President, Government Affairs at WSHA, told The Seattle Times. “Reducing healthcare services is an option nobody wants on the table. So, that leaves increasing revenues.”

Graphic

The graphic above from the Center for Healthcare Quality and Payment Reform (CHQPR) shows the number and location of rural hospitals in America that are at “immediate” risk of closure. The number of hospitals simply “at risk” of closure is substantially higher. Patients who depend on these hospitals would lose access to critical healthcare services including clinical laboratory testing. (Graphic copyright: Center for Healthcare Quality and Payment Reform.)

Becker’s Hospital Review reported last year that many hospitals across the country reported substantial losses in 2022. Three of the hospital systems in that article reported losses in the billions. They were:

In addition, Becker’s noted that five healthcare systems reported encountering losses over half a billion dollars in 2022. They include:

Critical Services Are Being Cut

In another article, Becker’s reported that 72 hospitals across the US closed departments or ended services in 2023. These cuts included the shuttering of health and urgent care clinics, the closure of outpatient cancer and pulmonary clinics, the reduction of certain surgical services and behavioral health services, and the ending of home healthcare services.

Some states are taking measures to prevent further hospital closures. But is it too late? In “California Doles Out $300 Million in No-Interest Loans to Save its Financially Struggling Hospitals,” The Dark Report’s sister publication Dark Daily covered how that state had launched an interest-free loan program to ensure local communities have access to community hospitals, their physicians, and clinical laboratories. No report on how many hospitals have been temporarily saved from closing thanks to this program.

If US hospitals continue to lose money at this rate, access to critical care—including clinical laboratory and anatomic pathology services—could be further restricted and facilities closed. These actions may also result in increased staff layoffs and have an even greater effect on patient care in Minnesota, Washington State, and throughout the US.

—JP Schlingman

Related Information:

Minnesota Hospital Association CEO Says the State’s Hospitals are in a Financial ‘Crisis’

Minnesota Hospitals and Health Systems Lose Hundreds of Millions as Revenues Fall and Inflation Hikes Labor and Other Costs

A Hard Look at Minnesota Hospital Finances

WA Hospitals Lost $2 Billion in 2022. A Plan to Up Medicaid Rates Could Help

72 Hospitals Closing Departments or Ending Services

What’s Up with Hospital Finances?

What’s Behind Losses at Large Nonprofit Health Systems?

20 Health Systems Reporting Losses in 2022

CHQPR Report: Rural Hospitals at Risk Of Closing

More Than 30% of Rural Hospitals Are at Risk of Closure, Report Warns

California Doles Out $300 Million in No-Interest Loans to Save its Financially Struggling

HospitalsHospitals, Pharmacies Struggle to Be Profitable

In Canada, Shortage of Medical Laboratory Technologists and Radiology Technicians Continues to Delay Care

Insights learned from Canada’s experience may benefit clinical laboratories and anatomic pathology groups in the US as well

Canada continues to face a severe shortage of skilled healthcare professionals, especially among medical laboratory technologists (MLTs) and radiology technicians (RTs). According to the Canadian Society for Medical Laboratory Science (CSMLS), “In 2010, the Canadian Institute for Health Information (CIHI) identified that approximately half of all MLTs would be eligible to retire in 10 years, with the greatest impact felt in Canada’s rural and remote communities.” Today, “This staffing concern is currently affecting the professional community across all provinces and territories resulting in the decrease of workers, dramatically impacting organizations and their employees.”

One thing true of government-run healthcare programs is that they consistently underinvest in building new facilities, upgrading older facilities, and training/retaining enough physicians, nurses, and clinical laboratory/radiology workers. This is seen in the UK, Canada, New Zealand, and Australia, where varies combinations of facility, physician, and other healthcare professional shortages generate regular headlines about patient wait times—particularly for elective procedures—that may be six months to a year or more.

For example, officials at Pasqua Hospital in Regina, which serves patients in southern Saskatchewan, Canada, say diagnostics services may need to be shut down by the end of January as a result of “extended, chronic staffing shortages.”

“We’re barely struggling to keep up with urgent cases,” Christy Labreche, a nuclear medicine technologist told the Regina-Leader Post, which noted that people requesting non-urgent treatment may need to make appointments six to 12 weeks out.  

More than 1,500 Saskatchewan residents have been waiting for more than 90 days for computerized tomography (CT) scans, according to the Canadian Union of Public Employees (CUPE).

Pasqua Hospital leaders have asked province officials to take “immediate action,” but they feel their concerns are “falling on deaf ears,” the Leader Post reported.

Bashir Jalloh

“For over a decade, we have been sounding the alarm on behalf of our members that provide a vital service in the continuum of care,” said nuclear medicine technologist Bashir Jalloh (above) in a CUPE statement. Jalloh is President of CUPE 5430, Saskatchewan’s largest healthcare union which represents medical technologists in a variety of specialties. “Now, as waitlists grow, we are at risk of more disruptions of services and communities on bypass for critical care at a time when wait lists are as long as ever.” Clinical laboratory leaders in the US can gain valuable insights from the struggle with shortages taking place in Canada. (Photo copyright: Regina-Leader Post.)

MLT Needs Beyond Saskatchewan

The Canadian Alliance of Medical Laboratory Professionals Regulators (CAMLPR) is working with government authorities on the current and projected countrywide shortage of medical laboratory professionals.

In an article he penned for Today’s Clinical Lab, Adam Chrobak, BSc, MBA, MLT, Registrar/CEO of the College of Medical Laboratory Technologists of Manitoba, and Vice-Chair of the CAMLPR, noted that about 25,600 new medical laboratory jobs will open up by 2031. He pointed out, however, that only about 20,400 people (20% less than what is needed) are expected to pursue those lab jobs, according to employment data from Employment and Social Development Canada, an agency of the Canadian government.

Chrobak noted the following reasons for the deficit of MLTs in Canada:

  • An aging workforce: Many current lab scientists are over age 50, signaling a “potential shortage of medical laboratory technologists when seasoned professionals retire.”
  • Lack of awareness and representation: Other healthcare fields may benefit by being in the public spotlight, while “opportunities and rewards” of a medical lab technology career may not be apparent to job seekers.
  • Insufficient funding for educational programs: The need for laboratory professionals may supersede “scarce healthcare dollars that fund education programs.”
  • Barriers to registration: International applicants may be challenged in “recognition of existing field-of-practice competencies.”

Solutions: Improve Recruitment, Retention

To address the MLT shortages across Canada, CAMLPR aims to step up the registration of people interested in the medical laboratory profession through a project in partnership with the Canadian government called the Flexible Pathways to Registration for Medical Laboratory Technologists. The goal is to develop competency standards for entering the profession, ease the registration process, and increase the supply of qualified health professionals in Canada, according to a news release

This is not the first time Dark Daily has covered Canada’s lab worker shortages. 

In “Clinical Laboratories Suffer During the ‘Great Resignation’,” we reported how the so-called “Great Resignation” caused by the COVID-19 pandemic has had a severe impact on clinical laboratory staffs, creating shortages of pathologists as well as of medical technologists, medical laboratory technicians, and other lab scientists who are vital to clinical laboratories in both Canada and the US.

And in “Lab Staffing Shortages Reaching Dire Levels,” Dark Daily’s sister publication, The Dark Report, noted that CAP Today characterized the current lab staffing shortage as going “from simmer to rolling boil” and that demand for medical technologists and other certified laboratory scientists far exceeds the available supply. Consequently, many labs use overtime and temp workers to handle daily testing, a strategy that has led to staff burnout and a high turnover rate.

Shortages in other areas of Canadian healthcare are on the rise as well, which we covered in “Number of Unfilled Medical Residencies Increases in Alberta and Other Areas of Canada.” We reported that, according to the Angus Reid Institute, approximately half of all Canadians cannot find a doctor or get a timely appointment with their current doctor. And that, just like in many parts of America, certain provinces are experiencing severe medical staffing shortages that includes clinical laboratories and pathology groups.

Global Insights May Offer Ideas  

Dark Daily’s coverage of healthcare industry challenges in Canada, the US, and other countries is aimed at helping clinical laboratory managers and pathologists understand challenges faced by government-run healthcare systems, where there is constant pressure on the government to provide adequate funding. Capital is needed to modernize and expand hospitals and clinics. At the same time, there is need to expand training opportunities to solve the shortage of clinical laboratory scientists, medical laboratory and imaging technologists, doctors, nurses, and other medical professionals.

The insights gained by studying these healthcare systems may be of value to US-based hospitals and medical laboratories that face their own worker recruitment and retention issues. 

—Donna Marie Pocius

Related Information:

Pasqua Hospital Imaging Techs Say Shutdown Imminent Due to Staffing Shortfall

Critical Shortage of Radiological Technologists in Saskatchewan Risks Patient Care

Reduction of Lab and X-ray Services in La Ronge Due to Crisis in Staffing

Saskatchewan Announces $6.9 Billion Healthcare Budget for 2023-24

Solving the Shortage of Medical Laboratory Technologists in Canada

Flexible Pathways to Registration for Medical Laboratory Technologists

Clinical Laboratories Suffer During the ‘Great Resignation’

Lab Staffing Shortages Reaching Dire Levels

Number of Unfilled Medical Residencies Increases in Alberta and Other Areas of Canada

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