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Former FDA Director to Speak at Executive War College on FDA’s Coming Regulation of Laboratory Developed Tests

Tim Stenzel, MD, PhD, will discuss what clinical laboratories need to know about the draft LDT rule, FDA memo on assay reclassification, and ISO-13485 harmonization

Many clinical laboratories anxiously await a final rule from the US Food and Drug Administration (FDA) that is expected to establish federal policies under which the agency will regulate laboratory developed tests (LDTs). The agency released a proposed rule on Oct. 3, 2023, setting a Dec. 4 deadline for submission of comments. The White House’s Office of Management and Budget received a draft of the final rule less than three months later on March 1, 2024.

“Given how fast it moved through HHS, the final [rule] is likely pretty close” to the draft version, wrote former FDA commissioner Scott Gottlieb, MD, in a post on LinkedIn. Gottlieb and other regulatory experts expect the White House to submit the final rule to Congress no later than May 22, and perhaps as soon as this month.

But what will the final rule look like? Tim Stenzel, MD, PhD, former director of the FDA’s Office of In Vitro Diagnostics, suggests that it is too soon to tell.

Stenzel, who retired from the FDA last year, emphasized that he was not speaking on behalf of the federal agency and that he adheres to all FDA confidentiality requirements. He formed a new company—Grey Haven LLC—through which he is accepting speaking engagements in what he describes as a public service.

“I’m taking a wait and see approach,” said Tim Stenzel, MD, PhD (above), former director of the FDA’s Office of In Vitro Diagnostics, in an interview with Dark Daily. “The rule is not finalized. The FDA received thousands of comments. It’s my impression that the FDA takes those comments seriously. Until the rule is published, we don’t know what it will say, so I don’t think it does any good to make assumptions.” Clinical laboratory leaders will have an opportunity to learn how to prepare for FDA regulation of LDTs directly from Stenzel at the upcoming Executive War College in May. (Photo copyright: LinkedIn.)

FDA’s History of LDT Regulation

Prior to his five-year stint at the agency, Stenzel held high-level positions at diagnostics manufacturers Invivoscribe, Quidel Corporation, Asuragen, and Abbott Laboratories. He also directed the clinical molecular diagnostics laboratory at Duke University Medical Center in North Carolina. In the latter role, during the late 1990s, he oversaw development of numerous LDTs, he said.

The FDA, he observed, has long taken the position that it has authority to regulate LDTs. However, since the 1970s, after Congress passed the Medical Device Amendments to the federal Food, Drug, and Cosmetic Act, the agency has generally exercised “enforcement discretion,” he said, in which it declined to regulate most of these tests.

At the time, “many LDTs were lower risk, small volume, and used for specialized needs of a local patient population,” the agency stated in a press release announcing the proposed rule. “Since then, due to changes in business practices and increasing ability to ship patient specimens across the country quickly, many LDTs are now used more widely, for a larger and more diverse population, with large laboratories accepting specimens from across the country.”

Clinical Labs Need a Plan for Submission of LDTs to FDA

The FDA proposed the new rule after Congress failed to vote on the VALID Act (Verifying Accurate Leading-edge IVCT Development Act of 2021), which would have established a statutory framework for FDA oversight of LDTs. Citing public comments from FDA officials, Stenzel believes the agency would have preferred the legislative approach. But when that failed, “they thought they needed to act, which left them with the rulemaking path,” he said.

The new rule, as proposed, would phase out enforcement discretion in five stages over four years, he noted. Labs would have to begin submitting high-risk tests for premarket review about three-and-a-half years from publication of the final rule, but not before Oct. 1, 2027. Premarket review requirements for moderate- or low-risk tests would follow about six months later.

While he suggested a “wait and see” approach to the final rule, he advises labs that might be affected to develop a plan for dealing with it.

Potential Lawsuits

Stenzel also noted the likelihood of litigation in which labs or other stakeholders will seek to block implementation of the rule. “It’s a fairly widespread belief that there will be a lawsuit or lawsuits that will take this issue through the courts,” he said. “That could take several years. There is no guarantee that the courts will ultimately side with the FDA.”

In “Perfect Storm of Clinical Lab and Pathology Practice Regulatory Changes to Be Featured in Discussions at 29th Annual Executive War College,” Dark Daily covers how the forces in play will directly impact the operations and financial stability of many of the nation’s clinical laboratories.

Stenzel is scheduled to speak about the LDT rule during three sessions at the upcoming Executive War College on Diagnostic, Clinical Laboratory, and Pathology Management conference taking place on April 30-May 1 in New Orleans.

He acknowledged that it is a controversial issue among clinical laboratories. Many labs have voiced opposition to the rule as well as the Valid Act.

Currently in retirement, Stenzel says he is making himself available as a resource through public speaking for laboratory professionals and other test developers who are seeking insights about the agency.

“The potential value that I bring is recent experience with the FDA and with stakeholders both inside and outside the FDA,” he said, adding that during his presentations he likes “to leave plenty of time for open-ended questions.”

In the case of his talks at the Executive War College, Stenzel said he anticipates “a robust conversation.”

He also expects to address other FDA-related issues, including:

  • A recent memo in which the agency said it would begin reclassifying most high-risk In Vitro Diagnostic (IVD) tests—those in class III (high risk)—into class II (moderate to high risk).
  • The emergence of multi-cancer detection (MCD) tests, which he described as a “hot topic in the LDT world.” The FDA has not yet approved any MCD tests, but some are available as LDTs.
  • A new voluntary pilot program in which the FDA will evaluate LDTs in situations where the agency has approved a treatment but has not authorized a corresponding companion diagnostic.
  • An FDA effort to harmonize ISO 13485—a set of international standards governing development of medical devices and diagnostics—with the agency’s own quality system regulations. Compliance with the ISO standards is necessary to market products in many countries outside the US, particularly in Europe, Stenzel noted. Harmonization will simplify product development, he said, because manufacturers won’t have to follow two or more sets of rules.

To learn how to prepare for the FDA’s future regulation of LDTs, clinical laboratory and pathology group managers would be wise to attend Stenzel’s presentations at this year’s Executive War College. Visit here to learn more and to secure your seat in New Orleans.

—Stephen Beale

Related Information:

FDA Proposes Rule Aimed at Helping to Ensure Safety and Effectiveness of Laboratory Developed Tests

Proposed Rule Webinar: Medical Devices; Laboratory Developed Tests (webinar transcript)

Proposed Rule Webinar: Medical Devices; Laboratory Developed Tests (slides)

FDA Proposed Rule on Medical Devices; Laboratory Developed Tests

CDRH Announces Intent to Initiate the Reclassification Process for Most High Risk IVDs

Questions and Answers about Multi-Cancer Detection Tests Oncology Drug Products Used with Certain In Vitro Diagnostics Pilot Program

Swiss Research Study into Long COVID Promises New Diagnostic and Therapeutic Possibilities

New biomarker may lead to new clinical laboratory testing and treatments for long COVID

Researchers studying long COVID at the University Hospital of Zurich (UZH) and the Swiss Institute of Bioinformatics (SIB), both in Switzerland, have discovered a protein biomarker in blood that indicates a component of the body’s innate immune system—called the complement system—remains active in some individuals long after the infection has run its course. The scientists are hopeful that further studies may provide clinical laboratories with a definitive test for long COVID, and pharma companies with a path to develop therapeutic drugs to treat it.

Ever since the COVID-19 pandemic began, a subset of the population worldwide continues to experience lingering symptoms even after the acute phase of the illness has passed. Patients with long COVID experience symptoms for weeks, even months after the initial viral infection has subsided. And because these symptoms can resemble other illnesses, long COVID is difficult to diagnose. 

This new biomarker may lead to new clinical laboratory diagnostic blood tests for long COVID, and to a greater understanding of why long COVID affects some patients and not others.

The Swiss scientists published their findings in the journal Science titled, “Persistent Complement Dysregulation with Signs of Thromboinflammation in Active Long COVID.”

“Those long COVID patients used to be like you and me, totally integrated [into] society with a job, social life, and private life,” infectious disease specialist Michelè van Vugt, MD (above), Senior Fellow and Professor at Amsterdam Institute for Global Health and Development (AIGHD), told Medical News Today. “After their COVID infection, for some of them, nothing was left because of their extreme fatigue. And this happened not only in one patient but many more—too many for only [a] psychological cause.” Clinical laboratories continue to perform tests on patients experiencing symptoms of COVID-19 even after the acute illness has passed. (Photo copyright: AIGHD.)

Role of the Complement System

To complete their study, the Swiss scientists monitored 113 patients who were confirmed through a reverse transcriptase quantitative polymerase chain reaction (RT-qPCR) test to have COVID-19. The study also included 39 healthy control patients who were not infected.

The researchers examined 6,596 proteins in 268 blood samples collected when the sick patients were at an acute stage of the virus, and then again six months after the infection. They found that 40 of the patients who were sick with COVID-19 eventually developed symptoms of long COVID. Those 40 patients all had a group of proteins in their blood showing that the complement system of their immune system was still elevated even after recovering from the virus.

“Complement is an arm of the immune system that ‘complements’ the action of the other arms,” Amesh Adalja, MD, Adjunct Assistant Professor at Johns Hopkins Bloomberg School of Public Health, told Prevention, “Activities that it performs range from literally attacking the cell membranes of a pathogen to summoning the cells of other immune systems to the site of infection.”

In addition to helping bodies heal from injury and illness, the complement immune system also activates inflammation in the body—and if the complement system is activated for too long the patient is at risk for autoimmune disease and other inflammatory conditions.

This inflammation may cause microclots in patients. “These can block the blood vessels and lead to damage … That can cause premature cardiac events, dementia, respiratory failure, and renal failure,” infectious disease specialist Thomas Russo, MD, SUNY Distinguished Professor, Department of Medicine, Jacobs School of Medicine and Biomedical Sciences, told Prevention.

Brain Fog

To make matters worse for long COVID patients, a recent study published in Nature Neuroscience titled, “Blood-Brain Barrier Disruption and Sustained Systemic Inflammation in Individuals with Long COVID-Associated Cognitive Impairment,” found that nearly 50% of people who experience long COVID also experience a condition called Brain Fog (aka, mental fog or clouding of consciousness.)

Conducted by genetic scientists at Trinity College Dublin and St. James’ Hospital in Dublin, Ireland, the study “analyzed blood samples—specifically, serum and plasma—from 76 patients who were hospitalized with COVID-19 in March or April 2020, along with those from 25 people taken before the pandemic. The researchers discovered that people who said they had brain fog had higher levels of a protein in their blood called S100β [a calcium-binding protein] than people who didn’t have brain fog,” Prevention reported.

“S100β is made by cells in the brain and isn’t normally found in the blood. That suggests that the patients had a breakdown in the blood-brain barrier, which blocks certain substances from getting to the brain and spinal cord, the researchers noted,” Prevention reported.

“The scientists then did MRI scans with dye of 22 people with long COVID (11 of them who reported having brain fog), along with 10 people who recovered from COVID-19. They found that long COVID patients who had brain fog had signs of a leaky blood-brain barrier,” Prevention noted.

“This leakiness likely disrupts the integrity of neurons in the brain by shifting the delicate balance of materials moving into and out of the brain,” Matthew Campbell, PhD, Professor and Head of Genetics at Trinity College Dublin, told Prevention.

Interactions with Other Viruses

According to Medical News Today, the Swiss study results also suggest that long COVID symptoms could appear because of the reactivation of a previous herpesvirus infection. The patients in the study showed increased antibodies against cytomegalovirus, a virus that half of all Americans have contracted by age 40.

The link between long COVID and these other viruses could be key to developing treatment for those suffering with both illnesses. The antiviral treatments used for the herpesvirus could potentially help treat long COVID symptoms as well, according to Medical News Today.

“Millions of people across the planet have long COVID or will develop it,” Thomas Russo MD, Professor and Chief of Infectious Disease at the University at Buffalo in New York, told Prevention. “It’s going to be the next major phase of this pandemic. If we don’t learn to diagnose and manage this, we are going to have many people with complications that impact their lives for the long term.”

Long COVID won’t be going away any time soon, much like the COVID-19 coronavirus. But these two studies may lead to more effective clinical laboratory testing, diagnoses, and treatments for millions of people suffering from the debilitating condition.

—Ashley Croce

Related Information:

New Study Finds Potential Cause of Long COVID Symptoms—Experts Explain

Persistent Complement Dysregulation with Signs of Thromboinflammation in Active Long COVID

CDC: Long COVID or Post-COVID Conditions

Long COVID: Major Findings, Mechanisms and Recommendations

Long COVID Explanation in New Study Possibly Paves Way for Tests and Treatments

Scientists May Have Discovered Reason for Long COVID Brain Fog—Here’s Why It Matters

Blood–Brain Barrier Disruption and Sustained Systemic Inflammation in Individuals with Long COVID-Associated Cognitive Impairment

Could New Clues on How Long COVID Affects Immune System Lead to Treatment?

Private Equity Firm General Catalyst to Buy Integrated Delivery Network Summa Health as Testing Ground for New Venture

Switching from non-profit to for-profit may affect how clinical laboratories operate in the new healthcare system

Shifting away from fee-for-service payment models and towards value-based healthcare is the goal of many non-profit hospital systems. One such transformation is underway at Summa Health, one of the largest integrated delivery networks (IDNs) in Ohio. On January 17, venture capital firm General Catalyst announced that its subsidiary—Health Assurance Transformation Corporation (HATCo)—had entered into an agreement to purchase Summa Health.

“HATCo’s investment into Summa Health will drive not only near-term benefit to the organization and the patients it serves but also sustainable, long-term transformation through a true shift to value-based care and access to new revenue streams, resources, innovations, and technologies,” states a General Catalyst news release penned by Marc Harrison, MD, CEO of HATCo.

Harrison was formerly President and CEO of Intermountain Healthcare, a 33 hospital not-for-profit IDN in Salt Lake City, Utah. This is a noteworthy fact because Intermountain Health has a national reputation as an innovative multi-hospital health system. Some observers believe that Harrison’s involvement signals that General Catalyst believes it has a care model that can deliver better patient care in a profitable manner.

“Under its new structure, Summa will become a for-profit organization, and General Catalyst says it will introduce new tech-enabled solutions that aim to make care more accessible and affordable,” CNBCreported.

“This is the first time that anybody has done anything quite like this,” Harrison told CNBC. “There are many digital health solutions that are out there as point solutions. This is the first holistic transformation of a health system to a thoughtful combination of digital and in-person care.”

“Our intent is to build on and augment the system’s considerable strengths. First and foremost, we share Summa Health’s commitment to serving all members of the community,” wrote HATCo CEO Marc Harrison, MD (above), in a news release. “The Summa Health team also shares our belief that achieving healthcare transformation will require a shift to value-based care … Together, we intend to demonstrate that a model that is better for patients can also be good for business, creating a blueprint for other health systems to effectively serve all people in their communities.” How this shift will affect Summa’s clinical laboratories remains to be seen. (Photo copyright: General Catalyst.)

Betting on Healthcare

In 2023, General Catalyst, an American venture capital firm headquartered in Cambridge, Mass., unveiled its Health Assurance Transformation Corporation (HATCo) and began shopping for a health system to buy.

HATCo has 20 healthcare systems in a network that spans 43 states and four countries, according to Healthcare Dive. The company’s news release states it has been focused on three areas since its start-up:

  • Helping its partners on their “transformation journeys.”
  • Using technology to build an “interoperability model.”
  • Planning to “acquire and operate a health system for the long-term.”

“The goal of the purchase is for the health system to act as a proving ground for General Catalyst to test ways to improve hospital operations and patient care, without risk aversion or cash shortfalls, management said,” Healthcare Dive reported.

Thus, the firm’s announcement to purchase a health system last October “sent shockwaves through the healthcare industry” according to Healthcare Dive.

“At its core, General Catalyst’s long-term Health Assurance thesis is that value-based care not only is good for patients, but also can be a successful business model if deployed with innovative technology at meaningful scale. Its rationale for buying a health system is a belief that it can improve on the traditional model of not-for-profit health system governance and management by embedding new incentives,” wrote Christopher Kerns, CEO and co-founder of Washington, D.C-based research firm Union Healthcare Insight, in a blog post analysis.

General Catalyst’s HATCo may offer up “a profit motive, a longer time horizon, and a channel for dozens of innovative companies to demonstrate value,” he noted.

“The single biggest barrier to promising young healthcare companies is an inability to scale. Many of their innovations—in digital health, patient engagement, revenue cycle workflow, etc.—require willing health system partners who are famously conservative in their investments and service providers, and rarely take risks on newbies. The addition of Summa provides an open laboratory for those innovations,” Kerns added.

Is the Summa Health Deal Good for Healthcare?

Some in the industry were taken aback by General Catalyst’s announcement.   

“A lot of people feel like a PE (private equity) or venture capital company owning a hospital is kind of like asking Freddy Krueger to come babysit your kids. It just makes people a little nervous, and it doesn’t feel quite aligned with this concept of healthcare being a human right,” John Bass, CEO of Hashed Health, a Nashville, Tenn.-based healthcare venture studio, told CNBC.

Nevertheless, it’s a moot point. HATCo is moving forward with its purchase of Summa Health.

“For this bet to work, Summa will have to be a solid proving ground for [General Catalyst’s] portfolio companies. And that means either Summa itself will have to grow, or it will have to act as a force multiplier for its other value-based portfolio companies to justify the considerable capital expended. I have to say, that’s a tall order, but not an insane one,” said Kerns in the Union Healthcare Insight blog post.

Healthcare managers may find it interesting to follow HATCo and Summa Health on their planned journey. The results may speak for themselves. Either way, clinical laboratories and anatomic pathology group practices in HATCo’s health system may be in for some interesting changes.

—Donna Marie Pocius

Related Information:

Our Acquisition of Summa Health

Summa Health and General Catalyst’s HATCo Announce Plans for Acquisition That Will Transform the Future of Healthcare

General Catalyst to Acquire Ohio Nonprofit Summa Health

The Big Bet of General Catalyst and Summa Health

4 Takeaways on General Catalyst’s Plan to Acquire Summa Health

General Catalyst’s New Health System Company to Acquire Summa Health

Venture Capital’s Firm’s Plan to Buy Nonprofit Hospital System Has Ohio Community on Edge

Intermountain Posts $135M Operating Income

General Catalyst’s HATCo Plans to Purchase Ohio Healthcare System Summa Health

Summa Health Fields Concerns Over General Catalyst Acquisition

Summa Health Sold to General Catalyst’s Health Assurance

Perfect Storm of Clinical Lab and Pathology Practice Regulatory Changes to Be Featured in Discussions at 29th Annual Executive War College

Forces in play will directly impact the operations and financial stability of many of the nation’s clinical laboratories

With significant regulatory changes expected in the next 18 to 24 months, experts are predicting a “Perfect Storm” for managers of clinical laboratories and pathology practices.

Currently looming are changes to critical regulations in two regulatory areas that will affect hospitals and medical laboratories. One regulatory change is unfolding with the US Food and Drug Administration (FDA) and the other regulatory effort centers around efforts to update the Clinical Laboratory Improvement Amendments of 1988 (CLIA).

The major FDA changes involve the soon-to-be-published Final Rule on Laboratory Developed Tests (LDTs), which is currently causing its own individual storm within healthcare and will likely lead to lawsuits, according to the FDA Law Blog.

In a similar fashion—and being managed under the federal Centers for Medicare and Medicaid Services (CMS)—are the changes to CLIA rules that are expected to be the most significant since 2003.

The final element of the “Perfect Storm” of changes coming to the lab industry is the increased use by private payers of Z-Codes for genetic test claims.

In his general keynote, Robert L. Michel, Dark Daily’s Editor-in-Chief and creator of the 29th Executive War College on Diagnostics, Clinical Laboratory, and Pathology Management, will set the stage by introducing a session titled, “Regulatory Trifecta Coming Soon to All Labs! Anticipating the Federal LDT Rule, Revisions to CLIA Regulations, and Private Payers’ Z-Code Policies for Genetic Claims.”

“There are an unprecedented set of regulatory challenges all smashing into each other and the time is now to start preparing for the coming storm,” says Robert L. Michel (above), Dark Daily’s Editor-in-Chief and creator of the 29th Executive War College on Diagnostics, Clinical Laboratory, and Pathology Management, a national conference on lab management taking place April 30-May 1, 2024, at the Hyatt in New Orleans. (Photo copyright: The Dark Intelligence Group.)

Coming Trifecta of Disruptive Forces to Clinical Laboratory, Anatomic Pathology

The upcoming changes, Michel notes, have the potential to cause major disruptions at hospitals and clinical laboratories nationwide.

“Importantly, this perfect storm—which I like to describe as a Trifecta because these three disruptive forces that will affect how labs will conduct business—is not yet on the radar screen of most lab administrators, executives, and pathologists,” he says.

Because of that, several sessions at this year’s Executive War College conference, now in its 29th year, will offer information designed to give attendees a better understanding of how to manage what’s coming for their labs and anatomic pathology practices.

“This regulatory trifecta consists of three elements,” adds Michel, who is also Editor-in-Chief of Dark Daily’s sister publication The Dark Report, a business intelligence service for senior level executives in the clinical laboratory and pathology industry, as well in companies that offer solutions to labs and pathology groups.

According to Michel, that trifecta includes the following:

Element 1

FDA’s Draft LDT Rule

FDA’s LDT rule is currently the headline story in the lab industry. Speaking about this development and two other FDA initiatives involving diagnostics at the upcoming Executive War College will be pathologist Tim Stenzel, MD, PhD, former director of the FDA’s Office of In Vitro Diagnostics. It’s expected that the final rule on LDTs could be published by the end of April.

Stenzel will also discuss harmonization of ISO 13485 Medical Devices and the FDA’s recent memo on reclassifying most high-risk in vitro diagnostics to moderate-risk to ease the regulatory burden on companies seeking agency review of their diagnostic assays.

Element 2

CLIA Reforms and Updates

The second element is coming reforms and updates to the CLIA regulations, which Michel says will be the “most-significant changes to CLIA in more than two decades.” Speaking on this will be Reynolds Salerno, PhD, Acting Director, Center for Laboratory Systems and Response at the federal Centers for Disease Control and Prevention (CDC).

Salerno will also cover the CDC’s efforts to foster closer connections with clinical labs and their local public health laboratories, as well as the expanding menu of services for labs that his department now offers.

Element 3

Private Payer Use of Z-Codes for Test Claims

On the third development—increased use by private payers of Z-Codes for genetic test claims—the speaker will be pathologist Gabriel Bien-Willner, MD, PhD. He is the Medical Director of the MolDX program at Palmetto GBA, a Medicare Administrative Contractor (MAC). It is the MolDX program that oversees the issuance of Z-Codes for molecular and diagnostic tests.

UnitedHealthcare (UHC) was first to issue such a Z-Code policy last year, although it has delayed implementation several times. Other major payers are watching to see if UHC succeeds with this requirement, Michel says.

Other Critical Topics to be Covered at EWC

In addition to these need-to-know regulatory topics, Michel says that this year’s Executive War College will present almost 100 sessions and include 148 speakers. Some of the other topics on the agenda in New Orleans include the following and more:

  • Standardizing automation, analyzers, and tests across 25 lab sites.
  • Effective ways to attract, hire, and retain top-performing pathologists.
  • Leveraging your lab’s managed care contracts to increase covered tests.
  • Legal and compliance risks of artificial intelligence (AI) in clinical care.

“Our agenda is filled with the topics that are critically important to senior managers when it comes to managing their labs and anatomic pathology practices,” Michel notes.

“Every laboratory in the United States should recognize these three powerful developments are all in play at the same time and each will have direct impact on the clinical and financial performance of our nation’s labs,” Michel says. “For that reason, every lab should have one or more of their leadership team present at this year’s Executive War College to understand the implications of these developments.”

Visit here to learn more about the 29th Executive War College conference taking place in New Orleans.

—Bob Croce

Related Information:

One Step Closer to Final: The LDT Rule Arrives at OMB, Making a Lawsuit More Likely

FDA: CDRH Announces Intent to Initiate the Reclassification Process for Most High Risk IVDs

FDA Proposes Down-Classifying Most High-Risk IVDs

Z-codes Requirements for Molecular Diagnostic Testing

2024 Executive War College Agenda

Increased Testing Demands from Physicians is Putting New Zealand Clinical Laboratories Under Severe Stress

Following the loss of its histology accreditation, pressure on APS laboratory continues to mount

Government-run healthcare systems around the world often under-invest as demand grows and new healthcare technologies enter clinical practice. One such example is taking place in New Zealand, where public pathology and medical laboratory services are under extreme stress as physician test orders exceed the ability of the island nation’s clinical laboratories to keep up.

“The escalating pressure is complicating what was already a very difficult rescue job at one of the country’s busiest labs—Community Anatomic Pathology Services (APS),” RNZ reported. In 2023, APS lost its histology accreditation after it came to light that lab workers were not only exposed to toxic chemical levels at the facility, but that patients were waiting weeks for test results to return from the lab.

This follows a 2021 report from consultants PricewaterhouseCoopers (PwC) to the Auckland District Health Board in which New Zealand health authorities received warnings to improve pathology systems.

“The service is in crisis mode and, without urgent investment … there is a real risk that it will fail. The changes required are of such urgency that it is recommended that they be placed at the top of the agenda,” the report reads, RNZ reported.

“The size of New Zealand’s economy is restricting what our country spends on health. Health is already the second highest demand on the New Zealand tax dollar,” wrote Andrew Blair, CMInstD (above), then General Manager of Royston Hospital, Hastings, New Zealand, in an article he penned for Jpn Hosp, the journal of the Japan Hospital Association. “The tolerance of New Zealanders would be challenged if a government attempted to increase taxes further to meet the growing demands for expenditure on health, but at the same time the population’s expectations are increasing. This is the challenging situation we face today.” For New Zealand’s clinical laboratories, the demand for testing is increasing annually as the country’s population grows. (Photo copyright: Blair Consulting.)

Increased Demand on APS Leads to Problems

Established in 2015, APS tests thousands of anatomic and tissue samples yearly and is utilized by approximately a third of NZ’s population, according to RNZ.

The big story, however, is that from 2022 to 2023 utilization increased by a third. “The overall increasing demand is greater than the capacity of the service,” Te Whatu Ora (Health New Zealand), the country’s publicly-funded healthcare system, told RNZ.

As planned care increased, public hospitals started outsourcing operations to private surgical centers. A domino effect ensued when all of those samples then made their way to APS. There was an “increased volume of private surgery being carried out by 600 specialists in the region and 2,000 general practitioners, with up to 450 histology cases a day,” RNZ noted, adding, “The backlog has hit turnaround times for processing samples, which had been deteriorating.”

To make matters even more dire, working conditions at the country’s clinical labs is unfavorable and deteriorating, with short staffing, outdated workspaces and equipment, and exposure to dangerous chemicals.

In “New Zealand Clinical Laboratories to Undergo Health and Safety Checks after Workers Contract Typhoid, Others Exposed to Chemicals,” Dark Daily covered how Health New Zealand recently ordered health and safety checks at multiple clinical laboratories in 18 districts across the country. The action is the result of safety issues detected after procedural discrepancies were discovered in separate labs and follows months of strikes by NZ medical laboratory workers seeking fair pay and safe working conditions.

“Conditions got so bad from 2019-2021 that workers were exposed to cancer-causing formaldehyde in cramped workspaces, and flammable chemicals were stored unsafely,” RNZ reported.

While pay increases and safety improvements have provided some relief, the memory of past incidences coupled with increasing delays continue to undermine confidence in New Zealand’s laboratory industry.

Patients Also at Risk Due to Long Delays in Test Results

“We recognize the concern and impact any delayed results can cause referrers and their patients,” Health New Zealand said in a statement, RNZ reported.

Nevertheless, a 2023 article in The Conversation noted that, “38,000 New Zealanders had been waiting longer than the four-month target for being seen by a specialist for an initial assessment.”

These backlogs can be especially deadly for cancer patients. In “Pathology Lab Shortages in New Zealand Are One Cause in Long Delays in Melanoma Diagnoses,” Dark Daily detailed how patients awaiting melanoma diagnoses are experiencing delays upwards of one month due to long waits for test results.

However, according to plastic surgeon and Melanoma Network of New Zealand (MelNet) Chair Gary Duncan, MBChB, FRACS, when patients return to their doctors for test results, those results often have not come back from the medical laboratory. Therefore, the physician cannot discuss any issues, which causes the patient to have to make another appointment or receive a melanoma diagnosis over the telephone, RNZ reported.

“Slow pathology services are unfair to patients. Such delays could result in the spreading of the melanoma to other parts of the body and require major surgery under anesthetic,” dermatologist Louise Reiche, MBChB, FRACS, told RNZ. “Not only will they suffer an extensive surgical procedure, but it could also shorten their life.”

Improvements at APS Underway

Changes are currently underway that may decrease the long delays in test results at New Zealand’s labs. “A business case was being done to set up an electronic ordering system to cut down on manual processing errors,” RNZ reported.

Additionally, “the situation is much improved due to dispersal of work around [the] city and country for now. The teamwork around the region has been a veritable lifesaver,” a source familiar with the work told RNZ.

Construction of a new lab for APS is also allegedly in the works. However, to date no announcement has been made, according to RNZ.

Time will tell if New Zealand’s government can repair its pathology system. News stories showcasing damage caused by lengthy delays in clinical laboratory test results—and the ensuing patient harm due to rationed care in general—continue to reveal the weakness in government-run healthcare systems.

—Kristin Althea O’Connor

Related Information:

Private Healthcare Pushing Auckland Labs to the Brink

Te Whatu Ora Pathology Service Provider Loses Accreditation

NZ’s Health System Has Been Under Pressure for Decades. Reforms Need to Think Big and Long-Term to Be Effective

Meeting Increased Demand

Eight-Week Wait for Skin Cancer Test Results Risking Lives-Doctors

Pathology Lab Shortages in New Zealand Are One Cause in Long Delays in Melanoma Diagnoses

Te Whatu Ora Tight-Lipped on New Auckland Pathology Lab

New Zealand Clinical Laboratories to Undergo Health and Safety Checks after Workers Contract Typhoid, Others Exposed to Chemicals

This comes on top of months of strikes by NZ medical laboratory workers seeking fair pay and safe working conditions

Te Whatu Ora (aka, Health New Zealand, the country’s publicly funded healthcare system) recently ordered health and safety checks at multiple clinical laboratories in 18 districts across the country. This action is the result of safety issues detected after procedural discrepancies were discovered in separate labs.

According to Radio New Zealand(RNZ), Health New Zealand found “significant risks” at some medical laboratories and that “staff at one in Auckland were exposed to toxic fumes, at others two [people] caught typhoid, and delays jeopardized patients’ care.”

“Two lab workers were hospitalized this year after having caught typhoid from samples, one at a private lab in Auckland, and a second at Canterbury Health Laboratories, CHL,” RNZ reported.

A Health New Zealand internal document states there will need to be a “comprehensive” fix to deal with risks present in the island nation’s medical laboratory industry. The assessment states that the organization needs “a more detailed picture of the occupational health and health and safety risks present in our laboratories,” RNZ reported.

“The overall state of the laboratories and the practices they have in place pose an inherited risk from the former DHBs [district health boards] and will likely need a comprehensive approach to addressing significant and/or ongoing risks,” Health New Zealand said in the internal document. “There is growing demand on our laboratories in terms of the volume of the work, which can put pressure on processes, and work is often undertaken in facilities that, over time, may have become not fit for purpose.”

This story as an example of how clinical laboratory staff can be exposed to disease and toxic chemicals when procedures are not diligently followed. It is a reminder to all lab managers that diligence in following protective protocols is imperative.

“Te Whatu Ora is committed to identifying, tracking and mitigating all potential risks and issues within our service until they are fully resolved and no longer identifiable as an issue/risk,” Rachel Haggerty (above), Director, Strategy, Planning and Purchasing, Hospital and Specialist Services, for Health New Zealand told NZ Doctor. Clinical laboratory workers in New Zealand have been striking for fair pay and safe working environments for months. Now, they risk becoming infected by deadly pathogens and chemicals as well. (Photo copyright: NZ Doctor.)

Lab Worker Strikes and Staff Shortages

Community Anatomic Pathology Services in Auckland lost its histology accreditation last year because it was discovered that lab workers were exposed to toxic chemical levels at the facility. In addition, patients were forced to wait weeks for test results from that lab. 

The laboratory was also penalized back in 2017 for how substances were handled when formaldehyde levels in excess of the recommended limits were detected. 

Bryan Raill, a medical scientist at the Counties Manukau District Health Board, said the laboratory workers union in New Zealand believes staff shortages and lab conditions are contributing to the lab woes. Raill is also president of the medical laboratory workers division of APEX, a specialist union representing more than 4,000 allied, scientific, and technical health professionals throughout New Zealand.

“It’s not only your physical environment, being safe there, but you have to be safe in terms of what you do,” Raill told RNZ.

Raill said the two typhoid infections were a red flag and that Te Whatu Ora needs to do more.

“They’re stepping out of the inertia they’ve been bound, so this is a good thing, but it needs to be a wider thing,” he said.

The New Zealand Institute of Medical Laboratory Science (NZIMLS) warned the government months ago that lab technicians were under unsustainable pressure.

“They should look at the other health and safety aspect of the workload and the work environment that staff are working under,” Raill explained in an iHeart podcast. “The person who caught typhoid in Christchurch spent four days in ICU, and there had been a workplace exposure to another pathogen two years earlier and the recommendations that came out of that hadn’t been followed. For example, [the lab workers] were not vaccinated against typhoid.”

IT Implementation Delays also to Blame

Along with strikes and staff shortages, clinical laboratories in New Zealand are also dealing with information technology (IT) issues. Technical problems have delayed some needed lab upgrades by more than a year. 

In addition, “The impacts of new test, surgeries, and medicines/treatments on pathology services have also historically not been understood well nor accounted for and we are considering a number of options, as outlined in the risk register, to manage this,” said Rachel Haggerty, Director, Strategy, Planning and Purchasing, Hospital and Specialist Services, for Te Whatu Ora.

Future efforts will deal with training of lab personnel and focus on ventilation and hazardous substance management. 

Dark Daily has reported extensively on the ongoing problems within New Zealand clinical laboratory industry.

In “Pathology Lab Shortages in New Zealand Are One Cause in Long Delays in Melanoma Diagnoses,” we reported how pathology shortages were causing some patients to wait for more than a month for a melanoma diagnosis. And that the situation is putting cancer patients’ lives at risk.

And in “Medical Laboratory Workers Again on Strike at Large Clinical Laboratory Company Locations around New Zealand,” we covered ongoing strikes by medical technicians, phlebotomists, and clinical laboratory scientists in New Zealand and how their complaints mirror similar complaints by healthcare and clinical laboratory workers in the US.

Clinical laboratory personnel can be exposed to dangerous diseases and toxic chemicals when procedures are not diligently followed. This latest situation in New Zealand serves as a reminder that following protective protocols is imperative in labs worldwide to protect workers and patients.

—JP Schlingman

Related Information:

Te Whatu Ora Finds ‘Significant’ Risks at Labs, Workers Catch Typhoid from Samples, Exposed to Fumes

How to Fix the NZ Laboratory Fiasco

Private Healthcare Pushing Auckland Labs to the Brink

Bryan Raill: Apex Union President Urges Te Whatu Ora to Thoroughly Assess Risk in New Zealand Laboratories

Pathology Lab Shortages in New Zealand Are One Cause in Long Delays in Melanoma Diagnoses

Medical Laboratory Workers Again on Strike at Large Clinical Laboratory Company Locations around New Zealand

Four Thousand New Zealand Medical Laboratory Scientists and Technicians Threatened to Strike over Low Pay and Poor Working Conditions

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