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

Hosted by Robert Michel

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

Hosted by Robert Michel
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Skepticism, Distrust of HIT by Healthcare Consumers Undermines Physician Adoption of Medical Reporting Technologies, But Is Opportunity for Pathology Groups, Clinical Laboratories

New studies show number of Americans who are unwilling to reveal private health information is growing, hindering medical technology developers

Healthcare consumers appear not only to be raising their expectations of the quality of care they receive, but also in the privacy and security of their protected health information (PHI) as well. This is an important development for clinical laboratories and pathology groups, since they hold large quantities of patient test data.

News reports indicate that, due to the increase in patient distrust about privacy and security, developers of health information technology (HIT) products that collect and transmit patient data are struggling to insert their products into the broader healthcare market.

However, there is a positive side to this trend for medical laboratory professionals. Patients’ interest in tighter security and privacy protections provides pathology groups and clinical laboratory leaders with an invaluable opportunity to inform patients on their lab’s use of cybersecurity measures and to reiterate their commitment to protecting their patients’ data.

Clinical Laboratories Can Ease Patient Fears

It’s not enough that medical laboratories promote their services and efficiencies. They also must tout the capability of their laboratory information management systems (LIMS) to protect a patient’s PHI. That’s critical because recent studies indicate high proportions of healthcare consumers are becoming increasingly wary of how their healthcare data are protected.

The graphic above taken from a 2017 Accenture survey may indicate why healthcare consumer trust in an organization’s ability to secure protected health data (PHI) has eroded so deeply. (Graphic copyright: Accenture.)

Numerous reports of data hacking and security breaches have eroded healthcare consumers’ trust. Patients are more skeptical than ever about the benefits of HIT, such as:

That’s according to a national poll conducted by Black Book Market Research of more than 12,000 consumers in the fourth quarter of 2016.

The poll aimed at exploring consumers’ adoption and acceptance of HIT. It found:

  • 87% of consumers are unwilling to divulge all their medical information (up from 66% in 2013);
  • 70% of Americans distrust health technology (a significant increase from 10% in 2014);
  • And 57% of people who underwent actual encounters with providers’ technology (including ancillary providers, such as clinical laboratories) remain skeptical of HIT.

Even with all the bells and whistles, HIT cannot penetrate the healthcare system if people don’t adopt it, a Black Book news release pointed out.

89% of Patients Withhold Information During Office Visits

Respondents to Black Book’s poll reported being especially alarmed by their data being shared (without their acknowledgement or consent) beyond their hospital and physician. This includes:

  • Pharmacy prescriptions (90%);
  • Mental health notes (99%); and
  • Chronic conditions (81%).

Other key findings from the Black Book poll include the fact that:

  • 89% of consumers withheld health information during their 2016 provider visits;
  • 93% are concerned about security of their personal financial information;
  • 69% say their primary care doctor does not have the technological expertise necessary for them to feel safe divulging extensive personal information.

Missing Data Compromises Care, Analytics

An article in Healthcare IT News reported that fear of breaches is translating to consumers’ reticence to share information. And, the Black Book survey states that data analytics and population health efforts by healthcare providers could be compromised due to consumer distrust, according to a FierceHealthcare article.

“Incomplete medical histories and undisclosed conditions, treatment, or medications raises obvious concerns on the reliability and usefulness of patient health data in application of risk-based analytics, care plans, modeling, payment reforms, and population health programming,” stated Doug Brown, President, Black Book, in the news release.

“This revelation should force cybersecurity solutions to the top of the technology priorities in 2017 to achieve tangible trust in big data dependability,” he concluded.

Patients/Doctors at Odds Over Use of Patient Data

According to the Black Book poll, 91% of people surveyed who use wearable medical tracking devices believe their physician’s EHR should be able to store any health-related data they wish. However, physicians responding to the provider section of the survey stated they have all the information they need. In fact, 94% of the doctors stated patient-generated data (generated by wearables) are “overwhelming, redundant, and unlikely to make a clinical difference.”

The disconnect has led to miscommunication and frustration in the doctor/patient relationship, noted a HealthITSecurity article.

Low Health Literacy Linked to Distrust of HIT

A study published in the Journal of Medical Internet Research by the University of Texas at Austin (UT) linked skepticism of HIT with low health literacy.

People who struggle to find and understand medical information tend to also be wary of health technologies, such as wearables, patient portals, and mobile apps, noted a UT news release.

Conversely, Americans with a high degree of health literacy are more likely to use fitness trackers and online portals and view them as useful and trustworthy, UT researchers stated.

This study of nearly 5,000 Americans also explored patients’ perceptions of privacy and trust in institutions. Researchers found lower health literacy was associated with more distrust and less adoption of HIT tools.

“There is a pressing need to further the understanding of how health literacy is related to HIT app adoption and usage. This will ensure that all users receive the full health benefits from these technologies in a manner that protects health information privacy, and that users engage with organizations and providers they trust,” the researchers wrote.

Cybersecurity a Priority for Labs

Cybersecurity and wearable technologies were identified as among the three primary trends (along with Social Media) facing clinical laboratories and in vitro diagnostics (IVD) manufacturers in 2017, according to insights shared by the Diagnostics Marketing Association in a recent Dark Daily e-briefing.

Another Dark Daily e-briefing summarized accounts of ransomware and cyberattacks on hospitals and medical labs in 2016. Clinical laboratory leaders are reminded to work with provider teams and appropriate experts to determine the lab’s ability to prevent and withstand cyberattacks.

Labs may glean some ideas from these cybersecurity “2017 must-haves” shared (along with others) in a Healthcare IT News article:

  • Invest in a risk assessment that makes clear exactly what needs to be protected;
  • Recognize that beyond medical and billing information, high tech equipment (such as lab analyzers) need to be addressed in planning.

Medical laboratory leaders should not be shy about communicating their lab’s cybersecurity priority, investment, and actions taken to keep their patient’s PHI private and secure. That message could be just what skeptical consumers need to hear and could be well received by the lab’s patients.

—Donna Marie Pocius

 

Related Information:

Healthcare’s Digital Divide Widens, Black Book Consumer Survey

Healthcare Digital Divide Getting Bigger and Other Bad News from Black Book

Patients Don’t Trust Health Information Technology Effects of Patient Distrust on health Data Exchange Security

Effects of Patient Distrust on health Data Exchange Security

One in Four US Consumers Have Had Their Healthcare Data Breached, Accenture Survey Reveals

New Health Literacy Digital Divide: Low Health Literacy Connected to Distrust of Health Technologies

Health Literacy and Health Technology Adoption: The Potential for a New Digital Divide

Top 10 Cybersecurity Must-Haves in 2017

Diagnostic Marketing Association’s Global Marketing Summit Will Convene in New Orleans Just Prior to the Executive War College to Discuss Primary Trends Facing IVD

MedStar Health Latest Victim in String of Ransomware Attacks on Hospitals and Medical Laboratories that Reveal the Vulnerability of Healthcare IT

Top 10 Rankings of EHR Market Share Put Epic First as Hospitals, Physicians, and Clinical Laboratories Make Progress on Interoperability

In both the hospital market and the ambulatory market, Epic has the best-selling electronic health records system, according to data issued by ONCHIT

Across the nation, clinical laboratories and pathology groups are busy interfacing their laboratory information (LIS) systems to the electronic health record (EHR) systems of their client hospitals and physicians. Yet, few lab managers know which EHR systems are dominating the market and which EHR systems are barely surviving.

In fact, it can be a challenge to understand market share by vendor. That is because market share can be determined in multiple ways. Dark Daily found three different rankings of EHR vendors. Each was based on slightly different sets of data. (more…)

Laboratory/Pathology Mergers & Acquisitions: Buyers Still Quite Interested

What is my lab worth? That’s the question every laboratory seller wants to know!

Despite an economy in recession, laboratory buyers remain bullish on the financial fortunes of clinical laboratories and anatomic pathology companies. The lack of publicly-announced acquisitions during 2009 masks the fact that lots of conversations are happening between lab buyers and lab owners.

Why such interest? On the buyer side, private equity companies and buyers are convinced that the demographics of the aging population translates into a robust demand for laboratory testing during the next decade. Further, they are enthusiastic about the potential for the steady introduction of powerful new diagnostic assays to further drive up lab test volume. They understand why patients and physicians will seek the benefits of higher sensitivity and improved accuracy from these new assays.

(more…)

Lab Acquisition Activity Stays Busy as Stanford and Carilion Negotiate with Buyers

With demand driving prices to record levels for clinical laboratory companies and anatomic pathology practices, merger and acquisition (M&A) activity in the lab industry continues to grow across the United States.

Just two weeks ago, Sonic Healthcare, Ltd. announced that it was purchasing Clinical Laboratories of Hawaii, LLP for an estimated $121 million dollars. That sale is expected to be completed by the end of third quarter this year. (See Dark Daily, June 30, 2008)

Still unannounced as of this date are the winning bidders for the laboratory outreach business of Stanford University Medical Center and the laboratory testing division of Carilion Clinic. Earlier this year, officials from both institutions disclosed that their laboratory businesses were up for sale. (See Dark Daily, April 15, 2008)

At this year’s Executive War College in May, attendees participated in the lab industry’s first-ever conference on “Mergers & Acquisitions in Clinical Laboratories and Anatomic Pathology,” a program designed to bring potential sellers of clinical labs, pathology groups, and hospital lab outreach programs together with experts in law, valuation, negotiation, and financial planning.

Two speakers attracted particular attention: Doug Brown, Managing Director of Wachovia Securities and attorney Antony Konkoly, Esquire, of McDonald Hopkins.

Brown provided a concise review of the factors supporting higher valuations for laboratory assets and discussed details of some recent noteworthy lab acquisitions. According to Brown, lab owners need to recognize that there is no simple way to establish a single value for their laboratories because different buyers will place different values on a lab company’s existing assets and future growth prospects.

Brown also discussed details of the 2007 acquisition of AmeriPath, Inc. by Quest Diagnostics, Inc. for approximately $2 billion. With annual revenue of $750 million, it was estimated that the multiple paid in this transaction was as high as 17 times EBITDA (earnings before interest, taxes, depreciation, and amortization). Brown pointed to several unique factors, including market timing, that supported AmeriPath’s top-of-market valuation at the moment the deal was inked. He also explained that these same factors were not likely to be seen in the laboratory industry again anytime soon.

In this same session, Antony Konkoly offered some important M&A do’s and don’ts based on his considerable experience representing various parties in the sale of laboratory businesses, the establishment of laboratory joint ventures and the formation of new lab companies.

If you weren’t able to participate in this exciting new M&A conference, here’s another opportunity to hear Doug Brown’s take on the current state of mergers and acquisitions in laboratory and pathology.

Attorney Antony Konkoly, Esq. will once again join Doug Brown in this discussion. From Konkoly, you’ll learn about the mistakes lab sellers often make, and how you can fix those issues before offering your laboratory for sale. You’ll also get several proven recommendations on how to minimize tax consequences and maximize the net proceeds from the sale.

Whether you’re a lab owner or pathologist, you won’t want to miss this comprehensive new audio conference. Join Dark Daily and The Dark Report as they present, “Lab and Pathology Mergers & Acquisitions: Must-Have Essentials To Learn Before You Buy Or Sell A Lab,” on Wednesday July 30, beginning at 1:00 p.m. EDT (10:00 a.m. Pacific) and running for 90 minutes.

Don’t miss this special audio conference and your chance to listen to and ask questions of these two veteran lab industry dealmakers.

Register on or before July 18, 2008 and you’ll save $50. So don’t wait-Register today! http://www.darkreport.com/Audio/7.30.08/audio-register.htm

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