Even US military clinical laboratories strive to cut costs, protect quality, and improve outcomes
Defense Health Agency (DHA), a part of the federal Department of Defense (DOD), recently launched a plan to consolidate healthcare facilities within certain geographical regions and to unify and integrate the military’s clinical laboratory operations in those areas. The goal is to streamline efficiencies and lower costs while maintaining quality lab testing services.
The DOD operates a nationwide network of medical treatment facilities (MTFs) that include state-of-the-art clinical and anatomic pathology laboratories serving military personnel and their families. These military labs face the same issues of cost, efficiency, and outcomes as do civilian clinical laboratories throughout the United States.
To address those challenges and bring together clinical laboratory services in specific regions, the DHA established the Tidewater Market in April of 2021 to serve select US Air Force, Army, and Navy MTFs in the Washington DC metro area, central North Carolina, Jacksonville, and coastal Mississippi.
Tidewater is the fifth Military Health System (MHS) market created to manage MTFs as they transition into the DHA.
Health.mil—a website maintained by the MHS as an informational resource for those it serves—describes the MHS as “one of America’s largest and most complex healthcare institutions, and the world’s preeminent military healthcare delivery operation.
“Our MHS saves lives on the battlefield, combats infectious disease around the world, and is responsible for providing health services through both direct care [at military hospitals and clinics known as ‘military treatment facilities’] and private sector care to approximately 9.6 million beneficiaries, composed of uniformed service members, military retirees, and family members,” Health.mil notes.
With 9.6 million beneficiaries, MHS is one of the largest healthcare service organizations operating in the United States.
“The establishment of this market provides a true opportunity to optimize healthcare for our beneficiaries by focusing on outcomes and access across the Tidewater market,” said Navy Rear Admiral Darin Via, MD, Tidewater market manager, in an MHS/DHA news release. “It also allows us to work towards standardization of processes, creating an easier environment for our patients to navigate within.” (Photo copyright: US Navy.)
Finding Efficiencies, Optimizing Clinical Laboratory Processes and Services
In an article outlining the Tidewater Market clinical laboratory initiative, Health.mil noted that “A market is a group of MTFs in one geographic area working together with its TRICARE partners, Veterans Affairs hospitals, other federal healthcare organizations, private sector teaching hospitals and medical universities, as well as other healthcare partners. Markets operate as a system to support the sharing of patients, staff, budget, and other functions across facilities to improve readiness and the delivery and coordination of health services.”
The Tidewater Market provides integrated, affordable, high-quality healthcare services to active-duty service members, military retirees, reservists and national guardsmen, and their families. The market currently serves more than 390,000 beneficiaries.
In 2022, the Tidewater Market Laboratory/Pathology Integration Working Group was created to optimize services while reducing costs within the market. The group was created by US Navy Captain Stacie Milavec, who has more than 23 years of experience in military medicine.
“One of DHA’s goals with setting up a market structure is to find efficiencies and optimize and standardize processes and services wherever possible,” Milavec said in an MHS/DHA news release. “We’ve been able to do exactly that by collaborating within our working group.”
Resource Sharing between Military Clinical Laboratories
The MTFs that are geographically close to each other helped expedite turnaround times for testing results. By working together, they saved the Tidewater Market an estimated $80,000 during fiscal year 2022.
One of the methods they used to streamline testing and lower costs was to allow resource sharing between facilities within the market. For example, the full-service clinical laboratory located at the Naval Medical Center Portsmouth (NMCP) began performing head and neck pathology cases, breast biopsies, and PAP testing for some of the other facilities within the Tidewater Market. These services were previously performed by other means and in some cases were sent to commercially-contracted clinical laboratories for analysis at a high cost.
The NMCP also took on Human Papilloma Virus (HPV) testing for all MTFs within the market.
In February of 2023, NMCP began taking on additional clinical chemistry tests from the 633rd Medical Group at Joint Base Langley-Eustis located in Hampton, Virginia. Prior to that collaboration, those tests were sent out to contracted labs off-base for analysis.
“[Through collaboration between the MTFs] we’ve been able to successfully transition civilian marketplace send-out testing back into the military market by utilizing market resources,” said pathologist US Air Force Captain Dianna Chormanski, MD, Laboratory Medical Director with the 633rd Medical Group at Joint Base Langley-Eustis, in the press release. “I’m a big fan of cooperation and working together, and that’s what a market should be.”
The DHA established the market-based structure as part of the National Defense Authorization Act for Fiscal Year 2017. It’s an example of regional laboratory consolidation within one region of the US where a common effort brought together clinical laboratories operating on military bases of different services. The military’s goal was a unified, integrated medical laboratory operation that could deliver targeted cost savings while maintaining quality lab testing services. It appears to be successful.
Pathologists and clinical laboratory scientists know that influenza vaccines typically produce short-lived protection and researchers have new clues as to why this is true
With so much interest in development of a COVID-19 vaccine, findings by researchers at Atlanta’s Emory Vaccine Center into why the vaccine for influenza (Flu) is so short-lived offer a new window on how the body’s immune system responds to invading viruses and what happens to the immunity over time.
Because the autumn influenza season is just weeks away, these insights into the body’s immune response to influenza will be of interest to clinical laboratories that provide testing for influenza, as well as SARS-CoV-2, the coronavirus that causes COVID-19.
Clinical laboratory managers recognize that an influenza vaccine is an annual imperative for people—especially the elderly and those with existing comorbidities—and medical laboratory tests are typically used to diagnose the illness and identify which strains of viruses are present. The flu vaccine is even more important amid the COVID-19 pandemic, infectious disease authorities say.
The scientists at the Emory Vaccine Center published their findings in the journal Science.
Not so with influenza vaccines. The immunity they impart generally only lasts for a single flu season and are “lost within one year,” the Emory study notes.
As Genetic Engineering and Biotechnology News (GEN) explains, the influenza genome has eight RNA segments which can change as the virus enters a cell. This antigenic shift creates new influenza strains that require updated vaccines, GEN noted.
However, the Emory researchers stated that “The fact that a small number did persist over one year raises prospects that the longevity of flu vaccines can be improved and provides key information for the development of universal vaccines against influenza.”
Bone Marrow Has Major Role in Producing New Flu Antibodies
The Emory study focused on the influenza vaccine’s role in how it affects the immune system and what needs to change to create a longer-lasting influenza vaccine. “Our results suggest that most bone marrow plasma cells (BMPC) generated by influenza vaccination in adults are short-lived. Designing strategies to enhance their persistence will be key,” the Emory researchers wrote in Science.
The scientists analyzed bone marrow from 53 healthy volunteers (age 20 to 45). An Emory news release states that bone marrow is the “home base for immune cells producing antibodies.”
Besides the bone marrow, the researchers also examined blood samples from the volunteers, all of which was collected between 2009 and 2018:
before influenza vaccination,
one month after influenza vaccination, and
one year post vaccination.
Through DNA sequencing the samples, the Emory researchers found the number of flu-specific cells increased from 0.8% to 1.9% after one month. They concluded that an annual vaccine does increase antibody-producing cells for influenza in bone marrow.
However, in follow-up visits one year after vaccination, they found that the number of cells present in the volunteers had fallen back to the starting point.
“Specific cells produced by the vaccine … produced unique antibodies that can be identified using sequencing techniques,” Carl Davis, PhD, postdoctoral fellow in the Rafi Ahmed Laboratory at Emory and first author of the paper, said in the news release, adding, “We could see that these new antibodies expanded in the bone marrow one month after vaccination and then contracted after one year.”
He continued, “On the other hand, antibodies against influenza that were in the bone marrow before the vaccine was given stayed at a constant level over one year.”
Vaccine Adjuvants Help Boost Immunity
A vaccine additive called an adjuvant could be the answer to extending the power of influenza vaccines, the Emory scientists noted.
“Just getting to the bone marrow is not enough. A plasma cell has to find a niche within the bone marrow and establish itself there and undergo gene expression and metabolism changes that promote longevity,” Rafi Ahmed, PhD, Director of the Emory Vaccine Center, said in the news release.
“It’s totally crazy (that the most commonly used influenza vaccines don’t include an adjuvant), Ahmed told Science. “I’m hoping that things will change in the influenza vaccine world, and 10 years from now, you will not be getting any nonadjuvanted vaccines.”
According to USA Today, about 20-million “essential” workers will likely be the first to receive the new COVID-19 vaccine and participate in check-in text messages with the Centers for Disease Control and Prevention (CDC) by the end of 2020.
In its COVID-19 vaccine testing, Novavax, a late-state biotechnology company, suggests that “an adjuvant is critical to its vaccine working well,” National Public Radio (NPR) reported in “The Special Sauce That Makes Some Vaccines Work.” However, vaccine developers may be reluctant to share their adjuvant research.
“Adjuvants end up being very proprietary. It’s kind of the secret sauce on how to make your protein vaccine work,” Barney Graham, MD, PhD, Deputy Director, Vaccine Research Center, National Institute of Allergy and Infectious Diseases, told NPR.
Still, a study published in Immunopharmacology revealed potential adjuvants for the COVID-19 vaccine based on vaccine studies of other coronaviruses. While there are many adjuvants available, not all have safety track records that can be leveraged to gain clearance from regulatory bodies, the researchers pointed out. But some do.
“CpG 1018, MF59, and AS03 are already approved for human vaccine and their inclusion may expedite the vaccine development process. Further, Protollin has shown promising results in pre-clinical studies,” the authors wrote.
Clinical laboratories that provide influenza testing will want to follow these types of research studies. Findings on immunity will affect development of vaccines that medical labs provide—including for COVID-19.
If direct-to-consumer testing continues to attract healthcare consumers and financial investors, medical laboratories could have a new source of revenue
Many have tried but few have found the right formula to
offer medical laboratory tests directly to consumers. Direct-to-consumer lab
testing as a robust business model has been an elusive goal. But now one
entrepreneur wants to crack this market and just attracted $50 million in
venture capital to fund her idea!
Outsiders often establish industries. This was the case when Jeff Bezos created Amazon in 1994. The online retailer transformed the way books were sold and, subsequently, established a massive new retail market.
Along the same lines, Julia Taylor Cheek, Founder and CEO of EverlyWell, a well-financed digital health company based in Austin—hopes to build a similarly disruptive business in the clinical laboratory industry.
Cheek is increasing her company’s outreach to consumers by
putting some of the company’s direct-to-consumer (DTC) medical tests on store
shelves at CVS and Target.
A former consultant and Harvard Business School graduate, Cheek raised $50 million in financing to expand EverlyWell’s digital platform. According to a news release, “Just two full years into operation, EverlyWell is reporting 300% year-over-year customer growth and a world-class consumer Net Promoter Score (NPS).”
“I think it’s a representation of sexism in our space. There are 15 other companies that have popped up in blood testing and you don’t hear anyone comparing Theranos to those male-founded startups,” she told Inc.
However, Dark Daily believes Cheek may be missing one
basis for the comparison with Elizabeth Holmes. Holmes intended for Theranos to
serve consumers with lab testing, and let consumers order and purchase their
own medical laboratory tests. Cheek is talking about the same primary business
strategy of letting consumers purchase their own lab tests.
Armed with this additional financing from investors, EverlyWell intends to expand services and develop new partnerships with retail pharmacy chain CVS Health (NYSE:CVS) and for-profit insurance company Humana (NYSE:HUM).
The news release notes, “The company has also expanded its
product line to offer 35 panels, including first-to-market tests in fertility,
vitamins, peri- and post-menopause, and high-risk HPV. In addition, EverlyWell
has launched an end-to-end care model for consumers, now offering an
independent physician consult and prescription, if appropriate, for select STDs
and Lyme Disease testing. All of this is included in an upfront price before
purchase.”
EverlyWell Intent on
Bringing Medical Laboratory Tests to Retail
Earlier this year, EverlyWell made nine lab tests available in more than 1,600 Target store locations, MedCity News reported. This may suggest that retailers are intrigued with direct-to-consumer lab testing.
“We didn’t create new tests or technologies. Instead, we’ve built technology that empowers people to get tests more easily. Our medical director works with the labs to create panels that are already validated and clinically relevant and understandable for consumers,” Julia Taylor Cheek (above), Founder and CEO of EverlyWell told Forbes. (Photo copyright: Arnold Wells/Austin Business Journal.)
Cheek reportedly established EverlyWell after becoming
disenchanted with medical laboratory tests that she felt were not well
explained and too costly under high-deductible health plans.
Just two years on, EverlyWell reports “hundreds of thousands of customers and tens of millions in sales.” The company plans to add additional staff on top of its existing 70 employees in anticipation of the new funding, Austin Business Journal reports.
“We are building a consumer brand, which means we have to be where people shop. We need to be in places like CVS and Target to really allow for broader distribution and name recognition,” Cheek told the Austin American-Statesman.
What Draws People to EverlyWell?
EverlyWell offers home health test kits, priced from $49 to
$400 that people can order without a doctor’s prescription and pay for online. Users
take their samples (saliva, urine, or a pinprick of blood) with provided
lancets and cotton swabs, MedCity News
reported.
EverlyWell’s top selling tests are:
Food sensitivity-$159;
Thyroid function-$159;
Metabolism-$89; and
Vitamin D deficiency-$99.
EverlyWell says it is “first” in direct-to-consumer tests
for:
EverlyWell Test kits come with registration information, instructions, collection tools;
Biological samples are sent by consumers to CLIA (Clinical Laboratory Improvement Amendments)-certified labs that partner with EverlyWell;
Results are generally completed within 10 days depending on type of test and business volume;
A physician reviews the test results;
Reports on test results are electronically accessible through smartphone apps and online web dashboards.
“Lab testing is arguably one of the most important steps in preventing and managing illness but has been largely ignored by digital health companies. EverlyWell is successfully navigating an entrenched industry to offer consumers an opportunity to take charge of their own health,” said Eric Kim, Managing Partner at Goodwater Capital (which led the financing), in the news release.
“We’re building the definitive technology-enabled healthcare platform that consumers deserve and have already come to expect in other areas of their lives,” Cheek told VentureBeat. “As high-deductible plans become the norm, consumers are becoming discerning buyers who look for seamless, digitally enabled experiences.”
Learning from
EverlyWell
Of course, pathologists and medical laboratory professionals
will watch to see if EverlyWell can sustain its rapid rise in popularity with
healthcare consumers. In particular, those consumers who prefer DTC testing
over traditional clinical laboratory visits and who may be on high-deductible
health plans.
The DTC test market represents an opportunity that most
clinical laboratories have yet to take seriously. There are many reasons why
medical lab managers and pathologists would be taking a “wait and see”
attitude. Meanwhile, EverlyWell has $50 million of investors’ money to use to
demonstrate the financial viability of its strategy to encourage consumers to purchase
their own clinical laboratory tests—and even collect their own specimens at
home!
Annual growth rates of 11% or more is predicted for molecular diagnostics in coming years
Just as consolidation and acquisitions reshaped the in vitro diagnostics (IVD) manufacturing industry and concentrated market share among just a handful of multi-billion dollar IVD giants, a similar consolidation can be seen in the molecular diagnostics sector. Today it is estimated that just nine global companies control 75% of the molecular diagnostics market.
That market concentration means clinical laboratories and anatomic pathology groups have a just a handful of primary vendors from which to purchase many of the molecular diagnostic assays and genetic tests that are used most frequently in clinical care.
Frost and Sullivan published a detailed study about the molecular diagnostics marketplace. The consulting firm estimated that worldwide sales of molecular diagnostics totaled $4.1 billion in 2010. By contrast, total IVD sales globally were about $48 billion in 2010. That total includes the routine, reference, and esoteric test kits, reagents, and supplies used every day by medical laboratories.
Because of HPV’s link to cervical cancer, and because cervical cancer screening is a major activity in the laboratory industry, big pharma efforts to make money from HPV-related products are worth watching. That’s because big pharma has the resources to powerfully influence public opinion and legislative action.
Here in Texas, home to Dark Daily and The Dark Report, it was big news last month when our Republican Governor, Rick Perry, bypassed the state Legislature and signed an order making Texas the first state to require that schoolgirls get vaccinated against HPV. Because HPV is considered a sexually-transmitted virus that causes cervical cancer, of course there were the usual public harangues about the moral implications of this order by folks from the right and from the left. Shortly thereafter, all the buzz died down.
But that’s not the end of the story, because Governor Perry’s order caused the media to look more deeply into why more than 20 state legislatures were actively considering bills to mandate HPV testing for school-aged children. How was it that so many state legislators were suddenly inspired to champion this cause, at almost the same time? It turned out that Merck & Co, the manufacturer of Gardasil, the only FDA-approved vaccine for HPV in the market, was supporting an active, behind-the-scenes lobbying program.
Within a couple of weeks after news stories made this connection public, Merck announced that it was suspending its support of programs designed to lobby state legislators in favor of laws to require HPV vaccinations of school-age children. There were numerous reasons for this suspension. Merck identified negative publicity as the primary one, but groups sighted potential damaging effects of the vaccine on young girls, the fact that this vaccine was quite different from other vaccines required by school systems (those vaccines are for diseases passed by casual contact), and a slew of other reasons. Doctors were happy to see the lobbying stop for another reason entirely, however.
Pediatricians and gynecologists nationwide are refusing to stock Gardasil, the HPV vaccine, because of its $360 price and “totally inadequate” reimbursement from most insurers. Pediatricians, in particular, are fed up after years of declining reimbursement for vaccines, an explosion of new vaccines, and fast-escalating vaccine prices. Vaccines pose a problem for practices because they tie up $50,000 or more in inventory, run multiple refrigerators, require vaccine insurance, and require inventory management. Practices also must absorb the cost of broken or wasted vials.
With insurance companies reimbursing just $2 to $15 over the $120 per dose (3 doses required for the whole vaccine) charged by Merck, most doctors have chosen to either not give the vaccine or to require a surcharge. Pediatrician Dr. Herschel Lessin pointed out on CNN that it was ironic that insurers wouldn’t give physicians an extra $25 to cover their costs, but they would spend tens of thousands if a patient developed cervical cancer without question.
The issue of coverage for HPV vaccination won’t disappear. That’s because GlaxoSmithKline expects regulatory approval for its own HPV vaccine, called Cerverix. When that happens, there will be two deep-pocketed pharma giants with an economic motive to increase the rate of HPV vaccination. For laboratory directors and pathologists, it is an opportunity to watch a business school case study play out in the real world. There will also be as-yet-undetermined, but direct, consequences to current cervical cancer screening guidelines. As a larger proportion of the female population is vaccinated for HPV, it will be necessary to revamp cervical cancer screening guidelines. That may eventually reduce the volume of Pap testing done annually in the United States.
