Big gains, small budget: a rural hospital lab implements a hosted LIS that yields big improvements in lab productivity, client service and patient care with a low total-cost-of-ownership - ASPs/LAB systems: case history

Health Management Technology, Sept, 2003

Tight budgets and staffing shortages strain the efforts of healthcare providers to deliver and maintain quality patient care. Clinical and anatomic pathology laboratories like those at Huron Medical Center in Michigan are no exception.

Lab staff are continually asked to do "more with less"--provide more services to cover an ever-widening service area with fewer operating capital resources and less staff. Huron ultimately found that automating its clinical and anatomic pathology laboratories could help meet those challenges, but hospital leadership had to find creative ways to successfully implement a laboratory information system (LIS) and contain costs. Adopting a hosted software model enabled Huron to extend its capabilities without significant overhead.

Huron Medical Center is a rural, 64-bed hospital located about 120 miles north of Detroit. The full-service, CAP-certified clinical and anatomic pathology laboratories serve about 800 doctors, both on the medical staff and as specialists as far away Detroit, Bay City, Flint and other parts of northeast Michigan. Huron performs about a half-million tests per year and conducts multiple profiles that consist of four to 14 different tests. The lab operates three full-service, 24/7 shifts staffed by 17 individuals, including a pathologist, histology technicians, medical technicians, phlebotomists and a lab manager.

Prior to automating laboratory functions, Huron used manual record-keeping and test-reporting procedures. As late as 2001, the clinical and pathology labs at Huron were still using stamped orders and tickets on lab mounts. The combination of paper-based record-keeping and administrative with the need to deliver increasingly sophisticated results created a delicate balance that--particularly with a manual system--could be thrown off if even one person was absent.

Hosted Solution

In addition to cost, the laboratory's main criteria for a new system centered on automated billing and filing, easier results retrieval, auto-faxing, quality control and automating surgical pathology. Huron explored a number of options, including leading LIS vendors and a few smaller ones. Laboratory leaders found that costs associated with a turnkey application were too high, so they shifted the focus to an application service provider (ASP)--Psyche Systems' hosted LabWeb LIS. Huron learned about the Milford, Mass.-based company through professional journals.

With a robust LIS with customizable report formats and an anatomic pathology information system, coupled with cost-savings and access to IT expertise without having to hire internal IT staff, the ASP solution was a strong offering. After analysis of the total cost of the system over a five-year period--taking into account license fees, hardware acquisition, service fees, spatial requirements and on-site support personnel--the ASP would allow Huron to implement a full-featured LIS at about one-third the cost of the turnkey systems. It was the projected savings of $250,000 that helped sell the project to the hospital's board.

Wanted: Easy Implementation

Ease-of-implementation was just as important as ease-of-use. The initial site visit from the Psyche Systems team was in June 2001, and Huron set a go-live date of January 2002. As former medical technicians, the Psyche implementation team could act as conduits in working with technical staff to ensure the LIS met Huron's specific needs. The team spent a great deal of time learning Huron's procedures. For instance, it wanted to know which tests the labs ran and on which machines, which CPT and billing codes were used, Huron's expectations for the design and outcomes of reporting, and how doctors are identified. The team then used that information to help Psyche Systems build a customized LIS for the medical center labs.

Huron encountered some bumps along the way, particularly in overcoming internal concerns about how the hosted software would securely interface with the hospital information system (HIS). The networking contractor worked directly with the vendor to identify a resolution and help obtain necessary approvals for the hosted system. Ultimately, Huron simply placed a firewall between the lab system and the hospital system.

Streamlining Processes

The hosted LIS has boosted Huron's productivity. The facilities now handle an average of 150 to 200 patient cases per day, an 11 percent increase compared to last year when the LIS was implemented. Overall, Huron has seen a 20 percent increase in its daily caseload with the automated system.

The automated system has also helped streamline processes and create efficiencies across the board in billing, record-keeping and distributing reports to referring physicians on a timely basis according to each doctor's specific requirements. Pulling demographics directly from the HIS also helps to ensure the accuracy of patient records, reducing potential billing errors to improve reimbursement rates. Additionally, record-keeping and retrieval is much easier with the bulk of cases filed electronically in an easy-to-search database that allows for advanced quality assurance reporting. Given the volume of reports produced, an automated system saves storage space for Huron, since paper-based files must be kept at the hospital for up to two years.