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Taiwan’s Containment of COVID-19 Outbreak Demonstrates Importance of Rapid Response, Including Fast Access to Clinical Laboratory Tests

By taking early measures to combat the spread, the country had a medical laboratory test for COVID-19 available as early as Jan. 24, and was able to focus medical laboratory testing on the most at-risk individuals

With the Coronavirus disease 2019 (COVID-19) outbreak dominating headlines and medical laboratories under growing pressure to increase testing capacity, Taiwan’s rapid response to the pandemic could provide a critical model for other countries to follow.

Given its proximity to mainland China—just 81 miles—and the large number of individuals who frequently travel back and forth between the countries, Taiwan was at risk of having the second-highest number of imported COVID-19 cases, according to a model developed by researchers at Johns Hopkins University and the University of New South Wales Sydney. News reports indicate that, each year, about 60,000 flights carry 10 million passengers between Taiwan and China.

But after the first reports emerged of the infection in Wuhan, China, “Taiwan quickly mobilized and instituted specific approaches for case identification, containment, and resource allocation to protect the public health,” wrote C. Jason Wang, MD, PhD; Chun Y. Ng, MBA, MPH; and Robert H. Brook, MD, ScD, in an article for the Journal of the American Medical Association (JAMA), titled, “Response to COVID-19 in Taiwan Big Data Analytics, New Technology, and Proactive Testing.”

Data from Taiwan’s Centers for Disease Control (CDC) and Central Epidemic Command Center (CECC) indicate that the country has managed to contain the outbreak thanks to these aggressive actions.

As of March 19, Taiwan’s CECC reported a total of 108 laboratory-confirmed COVID-19 infections. That compares with 81,155 in China, 41,035 in Italy, and 10,755 in the US, according to data compiled by the Center for Systems Science and Engineering at Johns Hopkins University. When the World Health Organization (WHO) reports on the number of COVID-19 cases by country, it includes the number of COVID-19 cases from Taiwan under the totals for the People’s Republic of China. WHO made this decision several years ago, under pressure by China to not recognize Taiwan as an independent nation.

The World Population Review website says Taiwan’s population is about 23.8 million. But its infection rate is low even on a per capita basis: Approximately 45 infections per million population, compared with 6,784 in Italy, 564 in China, and 326 per million in the US.

The JAMA authors noted that Taiwan was prepared for an outbreak after its experience with the severe acute respiratory syndrome (SARS) pandemic in 2003, which also originated in China.

Timeline of COVID-19 Outbreak at the Earliest Stages

Taiwan apparently learned a lesson about preparedness from the SARS outbreak the rest of the world did not and that enabled the tiny nation to respond immediately to the novel Coronavirus threat.

The country’s efforts began on Dec. 31 with inspections of flight arrivals from Wuhan. “When there were only a very few cases [of COVID-19] reported in China, [Taiwanese health authorities] already went onto every airplane that came from Wuhan,” C. Jason Wang, MD, PhD, an Associate Professor of Pediatrics and Director of the Center for Policy, Outcomes, and Prevention at Stanford University and lead author of the JAMA report, told Vox. “Health officials came on the airplane and checked people for symptoms,” he added.

Travelers who had recently visited Wuhan and displayed symptoms of pneumonia were quarantined at home for 14 days. Taiwan’s CDC reported that quarantined individuals were being tested for the 2019-nCoV coronavirus (later renamed to SARS-CoV-2) soon after it was identified. The CECC, activated in January to coordinate the government’s response, reported the first confirmed imported case on Jan. 21.

On Jan. 24, their CDC announced that testing for the virus was being performed at the CDC and eight designated hospitals. Testing included samples from physicians around the country. As of Feb. 17, daily testing capacity was about 1,300 samples, the JAMA authors reported.

Wang told Vox that aggressive measures to identify and isolate at-risk individuals at the earliest stages reduced the volume of clinical laboratory tests that had to be performed. “Here in the US and elsewhere, we’re now seeing community spread,” he said. “It’s probably been here for a while. And so now we’re trying to see, ‘Oh, how many people should we test?’ Then, you really need to have a very large capacity in the beginning.”

“I think the US has enormous capacity that’s currently not being used,” C. Jason Wang, MD, PhD (above), Associate Professor of Pediatrics and Director of the Center for Policy, Outcomes, and Prevention at Stanford University and lead author of the JAMA report, told Vox. “We have big tech companies that really could do a lot, right? We ought to get the big companies together. Get the governors together, get the federal government agencies to work with each other, and try to find innovative ways to think about how to best do this. We’ve got the smartest people here in the US because they come from everywhere. But right now, those are untapped resources. They’re not working together. And the federal government, the agencies, they need to collaborate a little more closely.” (Photo copyright: Stanford University.)

More Actions by Authorities

The JAMA report supplementary materials notes a total of 124 actions taken by Taiwanese authorities between Jan. 20 and Feb. 24 to contain the outbreak. In addition to the border inspections, quarantines and testing, they included integration of data between the country’s National Health Insurance Administration and National Immigration Agency, so authorities, and later hospitals, could identify any patient who had recently traveled to China, Hong Kong, or Macau.

The steps also included:

  • An escalating series of travel restrictions, eventually including suspension of most passenger flights from Taiwan to China, as well as a suspension of tours to Hong Kong or Macau.
  • Use of government-issued cell phones to monitor quarantined individuals.
  • Fines for individuals breaking the 14-day home quarantine.
  • Fines for incoming travelers who failed to provide accurate health information.
  • Fines for disseminating false information or rumors about the epidemic.
  • Fines and jail sentences for profiteering on disease-prevention products.
  • Designation of military camps and other government facilities for quarantine.
  • Nationwide disinfection of universities, colleges, and public spaces around schools.

The government also took aggressive action to ensure adequate supplies of surgical masks, including stepped-up manufacturing, export bans, price limits, and a limit of one to three masks per purchase.

The JAMA authors noted that government officials issued daily press briefings to educate the public about the outbreak. Communication efforts also included public service announcements by Taiwan Vice President Chen Chien-jen, a trained epidemiologist.

A poll taken in Taiwan on Feb. 17 and 18 indicated high approval ratings for officials’ response to the crisis.

The JAMA authors also noted some “challenges” in the government’s response. For example, most real-time public communication was in Mandarin Chinese and sign language, leaving out non-Taiwanese citizens in the country. And the cruise ship Diamond Princess, later found to have infections on board, was allowed to dock near Taipei and disembark passengers. There are also questions about whether similar policies can be sustained through the end of a pandemic.

Still, “well-trained and experienced teams of officials were quick to recognize the crisis and activated emergency management structures to address the emerging outbreak,” the JAMA authors wrote. “Taiwan is an example of how a society can respond quickly to a crisis and protect the interests of its citizens.”

One noteworthy difference in the speedy response to recognition of a novel coronavirus in Taiwan, compared to recognition of the same novel coronavirus in the United States, was the fast availability of clinical laboratory tests for COVID-19 in Taiwan.

Pathologists and clinical laboratory professionals here in the US are frustrated that their skills and talents at developing and validating new assays on an accelerated timeline were not acknowledged and leveraged by government officials as they decided how to respond to the emergence of the novel coronavirus now called SARS-CoV-2. 

—Stephen Beale

Related Information:

Taiwan CDC Press Releases about COVID-19

Is Taiwan’s Impressive Response to COVID-19 Possible in Canada?

Taiwan Has Been Shut Out of Global Health Discussions. Its Participation Could Have Saved Lives

Taiwan Has Only 77 Coronavirus Cases. Its Response to the Crisis Shows That Swift Action and Widespread Healthcare Can Prevent an Outbreak

What the U.S. Can Learn from Taiwan’s Response to Coronavirus

What Taiwan Can Teach the World on Fighting the Coronavirus

As Coronavirus Hot Spots Grow, Taiwan Beating the Odds Against COVID-19

They’ve Contained the Coronavirus. Here’s How

How Many Tests for COVID-19 Are Being Performed Around the World?

CDC Ranks Two More Drug-Resistant Microbes as ‘Urgent Threat’ to Americans; Clinical Laboratories Are Advised to Increase Awareness of Antimicrobial Resistance

In a separate study, HHS finds a 40% increase in sepsis cases, as more patients succumb to infections without effective antibiotics and antimicrobial drugs

Given the drastic steps being taken to slow the spread of the Coronavirus in America, it’s easy to forget that significant numbers of patients die each year due to antibiotic-resistant bacteria (ARB), other forms of antimicrobial resistance (AMR), and in thousands of cases the sepsis that follows the infections.

This is why the Centers for Disease Control and Prevention (CDC) issued the report “Antibiotic Resistance Threats in the United States, 2019 (2019 AR Threats Report)” last fall. The federal agency wants to call attention the emergence of new antibiotic-resistant bacteria and fungi. In its report, the CDC lists 18 bacteria and fungi that pose either urgent, serious, or concerning threats to humans. It also placed one fungus and two bacteria on a “watch” list.

The CDC’s website states that “more than 2.8 million antibiotic-resistant infections occur in the US each year, and more than 35,000 people die as a result.” And a CDC news release states, “on average, someone in the United States gets an antibiotic-resistant infection every 11 seconds and every 15 minutes someone dies.”

Those are huge numbers.

Clinical laboratory leaders and microbiologists have learned to be vigilant as it relates to dangerously infectious antimicrobial-resistant agents that can result in severe patient harm and death. Therefore, new threats identified in the CDC’s Antibiotic Resistance Threats in the United States report will be of interest.

Drug-resistant Microbes That Pose Severe Risk

The CDC has added the fungus Candida auris (C. auris) and carbapenem-resistant Acinetobacter (a bacteria that can survive for a long time on surfaces) to its list of “urgent threats” to public health, CDC said in the news release. These drug-resistant microbes are among 18 bacteria and fungi posing a greater threat to patients’ health than CDC previously estimated, Live Science reported.

In 2013, the CDC estimated that about two million people each year acquired an antibiotic-resistant (AR) infection that killed as many as 23,000. However, in 2019, the CDC reported that those numbers were low and that the number of deaths due to AR infections in 2013 was about twice that amount. During a news conference following the CDC announcement, Michael Craig (above), a Senior Adviser for the CDC’s Antibiotic Resistance Coordination and Strategy Unit said, “We knew and said [in 2013] that our estimate was conservative … and we were right,” Live Science reported. In 2019, CDC reported 2.8 million antibiotic-resistant infections annually with more than 35,000 related deaths in the US alone. (Photo copyright: Centers for Disease Control and Prevention.)

The CDC considers five threats to be urgent. Including the latest additions, they are:

Dark Daily has regularly covered the healthcare industry’s ongoing struggle with deadly fungus and bacteria that are responsible for hospital-acquired infections (HAI) and sepsis. This latest CDC report suggests healthcare providers continue to struggle with antimicrobial-resistant agents.

Acinetobacter Threat Increases and C. auris a New Threat since 2013

Carbapenem-resistant Acinetobacter, a bacterium that causes pneumonia and bloodstream and urinary tract infections, escalated from serious to urgent in 2013. About 8,500 infections and 700 deaths were noted by the CDC in 2017. 

C. auris, however, was not addressed in the 2013 report at all. “It’s a pathogen that we didn’t even know about when we wrote our last report in 2013, and since then it’s circumvented the globe,” said Michael Craig, Senior Adviser for the CDC’s Antibiotic Resistance Coordination and Strategy Unit, during a news conference following the CDC announcement, Live Science reported.

Today, C. auris is better understood. The fungus resists emerging drugs, can result in severe infections, and can be transmitted between patients, CDC noted.

Last year, Dark Daily reported on C. auris, noting that as of May 31 the CDC had tracked 685 cases. (See, “Potentially Fatal Fungus Invades Hospitals and Public Is Not Informed,” August 26, 2019.)

By year-end, CDC tracking showed 988 cases in the US.

More Patients Getting Sepsis as Antibiotics Fail: HHS Study

In a separate study published in Critical Care Medicine, a journal of the Society of Critical Care Medicine (SCCM), the US Department of Health and Human Services  (HHS) found that antibiotic-resistant bacteria and fungi are resulting in more people acquiring sepsis, a life-threatening condition, according to an HHS news release.

Sepsis increased by 40% among hospitalized Medicare patients from 2012 through 2018, HHS reported.   

“These (untreatable infections) are happening here and now in the United States in large numbers. This is isn’t some developing world thing. This isn’t a threat for 2050. It’s a threat for here and now,” Cornelius “Neil” Clancy, MD, Associate Chief of Veterans Affairs Pittsburg Health System (VAPHS) and Opportunistic Pathogens, told STAT.

It is troubling to see data about so many patient deaths related to antibiotic-resistant infections and sepsis cases when the world is transfixed by the Coronavirus. Nevertheless, it’s important that medical laboratory leaders and microbiologists keep track of how the US healthcare system is or is not responding to these new infectious agents. And, to contact infection control and environmental services colleagues to enhance surveillance, ensure safe healthcare environments and equipment, and adopt appropriate strategies to prevent antibiotic-resistant infections.   

—Donna Marie Pocius

Related Information:

CDC:  Biggest Threats and Data: 2019 Antibiotic Resistance Threats in the United States

More People in the U.S. Dying from Antibiotic-Resistant Infections Than Previously Estimated; Significant Progress Since 2013 Could be Lost Without More Action

These Two Drug-Resistant Microbes Are New “Urgent Threats” to Americans’ Health

CDC Report: 35,000 Americans Die of Antibiotic-Resistant Infections Each Year

The Superbug Candida Auris is Giving Rise to Warnings and Big Questions

On the Emergency of Candida Auris Climate Change, Azoles, Swamps, and Birds

Largest Study of Sepsis Cases Among Medicare Beneficiaries Finds Significant Burden

Sepsis Among Medicare Beneficiaries: The Burdens of Sepsis 2012 to 2018

Dark Daily: Hospital-Acquired Infection

Potentially Fatal Fungus Invades Hospitals and Public is Not Informed

Medical Laboratories Need to Prepare as Public Health Officials Deal with Latest Coronavirus Outbreak

The CDC has developed a test kit, but deployment to public health laboratories has been delayed by a manufacturing defect

Medical laboratories are on the diagnostic front lines of efforts in the US to contain the spread of severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), the virus responsible for the disease COVID-19, which was first reported in Wuhan City, China. SARS-CoV-2 differs from severe acute respiratory syndrome coronavirus (SARS-CoV), which caused an outbreak of severe acute respiratory syndrome (SARS) in 2003.

Currently, all testing for SARS-CoV-2 in the US is performed by the Centers for Disease Control and Prevention (CDC), using a CDC-developed rapid test known as the 2019-nCoV Real-Time RT-PCR Diagnostic Panel. But soon, testing will be performed by city and state public health (reference) laboratories as well.

At present, medical laboratories are collecting blood specimens for testing by authorized public health labs. However, clinical laboratories should prepare for the likelihood they will be called on to perform the testing using the CDC test or other tests under development.

“We need to be vigilant and understand everything related to the testing and the virus,” said Bodhraj Acharya, PhD, Manager of Chemistry and Referral Testing at the Laboratory Alliance of Central New York, in an exclusive interview with Dark Daily. “If the situation comes that you have to do the testing, you have to be ready for it.”

The CDC has set up a website with information about SARS-CoV-2 (COVID-19) including a section specifically for laboratory professionals. The “Information for Health Departments on Reporting a Person Under Investigation (PUI) or Laboratory-Confirmed Case for COVID-19” section includes guidelines for collecting, handling, and shipping specimens. It also has laboratory biosafety guidelines.

The current criteria for determining PUIs include clinical features, such as fever or signs of lower respiratory illness, combined with epidemiological risks, such as recent travel to China or close contact with a laboratory-confirmed COVID-19 patient. The CDC notes that “criteria are subject to change as additional information becomes available” and advises healthcare providers to consult with state or local health departments if they believe a patient meets the criteria.

Bodhraj Acharya, PhD (above), is Manager of Chemistry and Referral Testing at the Laboratory Alliance of Central New York. In an exclusive interview with Dark Daily, he stressed the importance that medical laboratories be prepared. “We need to be vigilant and be active and understand everything related to this virus and the testing. That’s the role of clinical laboratory scientists, to be ready because this can become a pandemic anytime. It can spread and tomorrow the CDC could announce it is disseminating the test to designated laboratories.” (Photo copyright: Laboratory Alliance of Central New York.)

Test Kit Problems Delay Diagnoses

On Feb. 4, the FDA issued a Novel Coronavirus Emergency Use Authorization (EUA) allowing state and city public health laboratories, as well as Department of Defense (DoD) labs, to perform presumptive qualitative testing using the Real-Time Reverse Transcriptase PCR (RT-PCR) diagnostic panel developed by the CDC. Two days later, the CDC began distributing the test kits, a CDC statement announced. Each kit could test 700 to 800 patients, the CDC said, and could provide results from respiratory specimens in four hours.

However, on Feb. 12, the agency revealed in a telebriefing that manufacturing problems with one of the reagents had caused state laboratories to get “inconclusive laboratory results” when performing the test.

“When the state receives these test kits, their procedure is to do quality control themselves in their own laboratories,” said Nancy Messonnier, MD, Director of the CDC National Center for Immunization and Respiratory Diseases (NCIRD), during the telebriefing. “Again, that is part of the normal procedures, but in doing it, some of the states identified some inconclusive laboratory results. We are working closely with them to correct the issues and as we’ve said all along, speed is important, but equally or more important in this situation is making sure that the laboratory results are correct.”

During a follow-up telebriefing on Feb. 14, Messonnier said that the CDC “is reformulating those reagents, and we are moving quickly to get those back out to our labs at the state and local public health labs.”

Above is a picture of CDC’s laboratory test kit for severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). CDC is shipping the test kits to laboratories CDC has designated as qualified, including US state and local public health laboratories, Department of Defense (DOD) laboratories, and select international laboratories. The test kits are bolstering global laboratory capacity for detecting SARS-CoV-2. (Photo and caption copyright: Centers for Disease Control and Prevention.)

Serologic Test Under Development

The current test has to be performed after a patient shows symptoms. The “outer bound” of the virus’ incubation period is 14 days, meaning “we expect someone who is infected to have symptoms some time during those 14 days,” Messonnier said. Testing too early could “produce a negative result,” she continued, because “the virus hasn’t established itself sufficiently in the system to be detected.”

Messonnier added that the agency plans to develop a serologic test that will identify people who were exposed to the virus and developed an immune response without getting sick. This will help determine how widespread it is and whether people are “seroconverting,” she said. To formulate this test, “we need to wait to draw specimens from US patients over a period of time. Once they have all of the appropriate specimens collected, I understand that it’s a matter of several weeks” before the serologic test will be ready, she concluded.

“Based on what we know now, we believe this virus spreads mainly from person to person among close contacts, which is defined [as] about six feet,” Messonnier said at the follow-up telebriefing. Transmission is primarily “through respiratory droplets produced when an infected person coughs or sneezes. People are thought to be the most contagious when they’re most symptomatic. That’s when they’re the sickest.” However, “some spread may happen before people show symptoms,” she said.

The virus can also spread when people touch contaminated surfaces and then touch their eyes, nose, or mouth. But it “does not last long on surfaces,” she said.

Where the Infection Began

SARS-CoV-2 was first identified during an outbreak in Wuhan, China, in December 2019. Soon thereafter, hospitals in the region “were overwhelmed” with cases of pneumonia, Dr. Acharya explained, but authorities could not trace the disease to a known pathogen. “Every time a new pathogen originates, or a current pathogen mutates into a new form, there are no molecular tests available to diagnose it,” he said.

So, genetic laboratories used next-generation sequencing, specifically unbiased nontargeted metagenomic RNA sequencing (UMERS), followed by phylogenetic analysis of nucleic acids derived from the hosts. “This approach does not require a prior knowledge of the expected pathogen,” Dr. Acharya explained. Instead, by understanding the virus’ genetic makeup, pathology laboratories could see how closely it was related to other known pathogens. They were able to identify it as a Betacoronavirus (Beta-CoVs), the family that also includes the viruses that cause SARS and Middle East Respiratory Syndrome (MERS).

This is a fast-moving story and medical laboratory leaders are advised to monitor the CDC website for continuing updates, as well as a website set up by WHO to provide technical guidance for labs.

—Stephen Beale

Related Information:

CDC Tests for COVID-19

CDC: Information for Laboratories

About Coronavirus Disease 2019 (COVID-19)

Real-Time RT-PCR Panel for Detection 2019-Novel Coronavirus

Coronavirus Disease (COVID-19) Outbreak

Coronavirus Disease (COVID-19) Technical Guidance: Laboratory Testing for 2019-nCoV in Humans

Novel Coronavirus Lab Protocols and Responses: Next Steps

WHO: China Leaders Discuss Next Steps in Battle Against Coronavirus Outbreak

Transcript for CDC Telebriefing: CDC Update on Novel Coronavirus February 12

Transcript for CDC Media Telebriefing: Update on COVID-19 February 14

Shipping of CDC 2019 Novel Coronavirus Diagnostic Test Kits Begins

Nominations Now Open for 5th Annual National Clinical Laboratory Sales Excellence Awards

This is an opportunity for top-producing sales reps from medical laboratories, anatomic pathology groups, and lab vendors to achieve national recognition at the upcoming Executive War College

Nominations are now open for The Dark Report’s 5th Annual National Lab Sales Excellence Awards. This awards program recognizes those laboratory sales professionals who exceed sales goals and successfully help their lab organization win new clients and expand market share.

Nominating applications are available at Executive War College/5th Annual National Lab Sales Excellence Awards and should be submitted by the sales professional’s sales manager based on the sales rep’s 2019 performance. Winners will receive an all-expense paid trip to New Orleans for the 25th Annual Executive War College on Lab and Pathology Management on April 28-29.

Each winner will also receive a check for $2,000!

“This is the fifth year for this first and only national recognition program in the United States for sales professionals involved in the clinical laboratory profession,” stated Robert L. Michel, Editor-in-Chief of The Dark Report. “It’s important for our industry because it shows the leaders and pathologists in other labs that, despite negative trends in the lab marketplace, there are sales professionals who continue to generate substantial volumes of new clients, new specimens, and new revenue for the clinical labs and pathology groups they represent.

“Moreover, as the sales team in your lab learns what some of their top-performing peers have accomplished, it raises the bar and motivates them to achieve more and reach for stretch goals that benefit them personally and contribute to the success of the lab that they represent,” emphasized Michel.

“Each year, the winners of the National Lab Sales Excellence Award tell us that this recognition was not only important for them, but that their hospital CEO and senior administrators took notice and it raised the profile of the lab throughout the entire hospital because of the national recognition for the accomplishments of the lab’s top sales producer. In some cases, the local newspapers picked up the story and reported it—another positive benefit for the lab in the community. Some award winners report that just the news coverage of the award led to new accounts from physicians who wanted the top service these lab sales professionals deliver.”

Winners are selected in each of three categories that represent the major sectors of the lab testing marketplace. The sectors are:

  • Hospital Laboratory Outreach;
  • Independent Clinical/Anatomic Pathology Laboratory (including molecular and genetic testing); and
  • Laboratory Supply Company/In Vitro Diagnostics Equipment Company.
Robert L. Michel, Editor-in-Chief of The Dark Report, is shown above with Tammy W. Mullen, Sales Representative with HealthLab in Aurora, Ill., a full-service, pathologist-directed clinical laboratory that is part of Northwestern Medicine. Mullen received her award during the 2019 Executive War College on Laboratory and Pathology Management in New Orleans. Each year, Laboratory Sales professionals are recognized for their achievements with the National Lab Sales Excellence Award. (Photo copyright: The Dark Report.)

Nominations for National Lab Sales Excellence Awards

“We are asking that the sales managers and sales VPs of these sales reps nominate their top candidates. Nominations of these high-achieving medical lab industry sales professionals for the National Lab Sales Excellence Award are being accepted now. Details and the nominating form are available by clicking here or by copy and pasting this URL into your web browser: https://www.executivewarcollege.com/lab-sales-excellence-award-contest/.

To be considered, nominee applications should encompass actual sales results, feedback from nominating managers, and references from clients. Lab sales professionals will also be judged on other variables, such as:

  • The competitive environment;
  • Compliance with all state and federal regulations; and
  • Ethical behavior.

“A panel of judges will evaluate each nomination,” noted Michel. “These are individuals with their own impressive track record in sales and marketing. They understand the techniques of ethical selling, the unique aspects of marketing laboratory tests, and how much effort is required to build the number of clients, specimen volume, and revenue from assigned territories.”

It’s the medical laboratory industry’s first and only National Laboratory Sales Award program. Sales representatives employed by clinical laboratories, anatomic pathology groups, specialty molecular and genetic testing lab companies, in vitro diagnostics companies, and laboratory information technology companies will be competing for national recognition as The Dark Report announces the winners of its 5th annual National Lab Sales Excellence Awards during the Executive War College on Laboratory and Pathology Management, which takes place April 28-29, 2020, in New Orleans. (Image copyright: The Dark Report.)

2020 Lab Sales Awards to Be Announced on April 29 in New Orleans

Nominations for the National Lab Sales Achievement Award are to be submitted to the offices of The Dark Report by Friday, March 20, 2020. Winners in each of the three categories will be notified by April 3 to allow them time to make arrangements to travel to New Orleans to be at the Executive War College for the award ceremony.

“Lab CEOs and hospital/health network lab administrators should recognize how having a winner from their sales team can turbo-charge their entire clinical laboratory sales program,” observed Michel. “By their nature, the 20% of the sales reps in your marketing program who do 80% of the business are highly competitive. We’ve had the sales vice presidents who nominated their top sales producer tell us, a year later, that having a National Lab Sales Excellence Award winner motivated the entire sales team, and that their lab saw substantial increases in specimen volume and revenue because other sales reps wanted to step up to the plate and show what they could produce.”

Michel also took the time to address the long-standing popular wisdom in the clinical laboratory industry that every lab wants to keep its top sales producers under wraps, because if competitors knew how much new lab business they were generating, competitors would recruit them away.

“This is one of those clinical lab industry widely-held beliefs that needs to disappear,” he explained. “The reality is that, in every community, competing labs (and competing sales reps) always know who the top producers are. Good lab leaders know how to retain their top performers and one way to do that is to boost their reputations and recognize their sales achievements by nominating these high-energy, result-driven producers for the unique recognition that comes from the National Lab Sales Excellence Award.”

Lab CEOs, administrators, Sales VPs, and Sales Managers—you can click here to get the nominating form for the 5th Annual National Lab Sales Excellence Awards (or by pasting this URL into your browser: http://www.executivewarcollege.com/wp-content/uploads/National-Lab-Sales-2020-Nomination-Form_02-13-2020.pdf).

—Michael McBride

Related Information:

To learn about The Dark Report’s National Lab Sales Excellence Award program

To access the nomination form for the National Lab Sales Excellence Award

Why Clinical Labs and Anatomic Pathology Are at Risk Because of No Formal Succession Plan to Develop Their Next Generation of Management Leaders

Speakers from UCLA, Alverno Clinical Laboratories, and TriCore Reference Labs Discuss the Creation of Value-Added Lab Services at 20th Annual Executive War College

North Carolina Providers Slow State Effort to Impose Reference Pricing They Claim Could Remove Hundreds of Doctors and Medical Service Providers from the State’s Healthcare Network

North Carolina turned to reference pricing to reduce employee health costs, but hospitals in the Tarheel State fought back

Efforts by North Carolina’s State Health Plan to adopt reference pricing for its state employees have largely failed, due to united opposition to the reimbursement model by the state’s hospitals, Modern Healthcare reported.

Clinical laboratory leaders are aware that reference pricing is a tool employers and health insurer can use to reduce the wide variation different providers charge for the same clinical service. In 2016 our sister publication, The Dark Report, devoted an entire issue to the subject of reference pricing. (See TDR, “The Newest Threat to Lab Revenues: Reference Pricing in Healthcare,” September 6, 2016.)

The Dark Report wrote about the reference pricing pilot conducted by Safeway, the grocery chain, in collaboration with Anthem, Inc. (NYSE:ANTM), the large health insurance company. The reference pricing program had these elements:

  • When Safeway employees and their beneficiaries chose a lab that priced its tests below the 60th percentile, the patient qualified for the health plan’s benefits. But if the patient chose a lab with test prices above the 60th percentile, that patient was responsible for the full cost of the test.
  • Safeway employees and their beneficiaries were given a real-time price checking tool that they could access by web browser and smart phone. This app, developed by Castlight Health, Inc., of San Francisco, showed the prices each lab in the Safeway/Anthem network charged for the same lab test, along with the percentile price of that test.

As reported in JAMA Internal Medicine, Safeway introduced reference pricing into its health insurance design for 15,000 employees in 2011. Three years later, the company and its employees were spending 32% less for clinical laboratory tests and saved $2.57 million during the years 2011 to 2013.

The reference pricing program at Safeway, which focused primarily on clinical laboratory testing, succeeded because of the large variability in how different labs price the same tests. For example, as TDR reported:

  • For a basic metabolic panel, which was the most commonly prescribed test, prices among different labs ranged from $5.75 to $126.44; and
  • Prices for a lipid panel ranged from $8.85 to $74.92.
A screenshot of a cell phone

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The graphic above, taken from the Safeway/Anthem observational study of “changes in laboratory pricing and selection by employees … before and after a reference pricing policy for laboratory services,” illustrates the wide range of prices Safeway paid for the 10 most common clinical laboratory tests. (Graphic copyright: American Medical Association/JAMA Internal Medicine.)

Typically, a reference pricing arrangement is done to lower costs, decrease disparities in pricing for similar medical services, and make health plans more attractive to employers. This is why state health plans are looking at implementing reference price reimbursement models as a way to reduce healthcare costs for state employees and other beneficiaries.

North Carolina Providers Respond Negatively to State Reference Pricing Plan

North Carolina’s State Health Plan encountered resistance from the state’s medical community when it attempted to implement a similar reference-price reimbursement model.

The state’s health plan covers more than 727,000 beneficiaries, including teachers, state employees, retired employees, and their dependents. It is overseen by the State Treasurer and administered by BlueCross BlueShield of North Carolina (Blue Cross NC).

In October 2018, North Carolina’s state health plan board of trustees unanimously approved the Clear Pricing Project, a reference-pricing program championed by State Treasurer Dale Folwell. A 2019 Blue Cross NC State Health Plan Network Master Reimbursement Exhibit document states, beginning in 2020, most hospitals would get 160% of the Medicare rate for inpatient services and 230% for outpatient services; rural providers would get more.

Pricing for medical lab and pathology services also was set at 160% of the Medicare rate. The document states, “Except for services identified by Medicare as CLIA Excluded or CLIA Waiver, In-Office Laboratory Service fees will be limited to those services for which you have provided Blue Cross and Blue Shield of North Carolina with evidence of CLIA certification.”

North Carolina’s healthcare providers had no choice but to agree to the pricing to be included in the state’s provider network, but they were not happy about the arrangement.

NCHA Warns Hundreds of Providers Could Be Pushed Out of Network

Hospitals countered with a public relations and lobbying campaign through the North Carolina Healthcare Association (NCHA). Soon after Folwell’s announcement, the NCHA issued a statement claiming that his plan “could force hundreds of providers out of the State Health Plan network or out of business.” The NCHA estimated the potential losses to hospitals and health systems at “upwards of $400 million.”

In the statement, NCHA President Steve Lawler said, “We believe the treasurer is not being transparent about what this proposal will do to state health plan members and their families.”

As an alternative, the NCHA proposed that the state examine value-based approaches such as “case management, outcomes-based payment models, and member education as ways to manage costs.”

The organization established a web page explaining its opposition to the state’s plan and pushed for legislation that would delay its implementation. House Bill 184, which sought to delay implementation of the state’s healthcare reimbursement plan, passed the state House of Representatives in April, before stalling in the Senate in May, North Carolina Health News reported.

Many providers simply refused to sign the necessary contracts, Modern Healthcare reported, even after Folwell agreed to increase the average rate to 196%. In August, he relented and announced that for 2020, the provider network will consist of the North Carolina State Health Plan Network—28,000 providers that had signed on to the Clear Pricing Project—plus the Blue Options PPO Network, which includes providers that had not agreed to the new pricing.

That makes for a total of more than 68,000 providers, states a news release from the treasurer’s office. After the change was announced, providers in the State Health Plan Network were permitted to revert to the Blue Options PPO Network rates.

States may approach implementing reference pricing in different ways, which will likely lead to a distinct disparity in outcomes. Nevertheless, whatever approach is used, medical laboratories and pathology groups will want to understand how reference pricing works and how it may be implemented in their states.

Armed with that understanding, they may want to pursue a proactive strategy of aligning the prices of their lab tests to be at the 50th percentile or lower to avoid being the highest-priced labs in their communities and regions.

—Stephen Beale

Related Information:

NC Aims to Tie Reimbursement to Medicare for State Employees

N.C. Walks Back Reference-Based Pricing Plan for State Workers

Association of Reference Pricing for Diagnostic Laboratory Testing with Changes in Patient Choices, Prices, and Total Spending for Diagnostic Tests

Association of Reference Pricing for Diagnostic Laboratory Testing with Changes in Patient Choices, Prices, and Total Spending for Diagnostic Tests

State Health Plan Proposed Changes Threaten Healthcare Access for All

North Carolina’s Healthcare Leaders Send Open Letter to NCGA Senators

NCHA Statement on Revised State Health Plan Proposal

NC Healthcare Providers Renew Call for Collaboration on State Health Plan

No Change for State Health Plan Members in 2020

NC State Health Plan Announces Network for 2020

NC State Health Plan Network Increases Payments to Hospitals and Reopens Sign-Up Period

NC State Health Plan Network Contracts Now Available to Medical Providers as Part of Clear Pricing Project

Bill Filed to Stop State Health Plan from Making Health Care Affordable for State Employees

State Health Plan Board of Trustees Unanimously Supports Provider Reimbursement Initiative That Lowers Health Care Costs

State Health Plan Launches New Provider Reimbursement Effort

Plan to Peg State Employee Health Plan Prices to Medicare Rates May Face Legislative Opposition

No More Negotiations: State Health Plan Wants Clearer Process, Lower Prices

On State Health Plan Changes, Folwell Hits Gas While Lawmakers Threaten to Tap Brakes

Treasurer Moves Forward with Health Care Pricing Plan Despite Uncertainty

Lawmakers Derail State Treasurer’s Plan to Change State Health Plan Reimbursement

North Carolina State Health Plan Network Master Reimbursement Exhibit April 2019

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