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How hospital administrators view the lab.

How hospital administrators view the lab

Start with a laboratory background. Fortify it with management training and financial know-how. Then add these qualities: ability to recruit, retain, and get the most out of good employees; ability to deliver accurate test data as rapidly and cost-effectively as possible; ability to act as a team player and problem solver in the hospital; and ability to satisfy clinicians and help them use the laboratory more efficiently.

Whoever fits that bill has a good shot at the next job opening for laboratory manager in any of the hospitals MLO contacted while preparing this two-part special report. We spoke to administrators at seven institutions in New York City and New Jersey. Topics covered below in Part I include what administrators look for in laboratory management, criteria used to assess laboratory performance, lab staffing under DRGs, and how administration evaluates proposed capital expenditures. Part II will explore new ventures being undertaken by laboratories and their hospitals.

Prospective payment has rewritten job standards for hospital laboratory managers. "Managers in the past tended to think that it was their duty to protect their lab and their people, like a piece of turf,' says Lynn Nemeth, vice president of administration at Atlantic Health Systems, Chatham, N.J. "Many were very isolationist in their attitudes.'

Nemeth's firm is a holding company under which two New Jersey hospitals, 621-bed Morristown Memorial and 635-bed Overlook Hospital in Summit, are consolidating. She began her 11-year health care career in the laboratory at Morristown Memorial, rising from bench technologist to microbiology/immunology supervisor to administrative director of laboratory services. Along the way, she earned a master's degree in health care administration. Then the hospital promoted her to assistant vice president-professional services with reponsibility for the laboratory and a number of other departments. She held that position until last year, when she joined Atlantic Health Systems.

"These days, I would look for laboratory managers who see themselves as just one important part of the team,' Nemeth continues. "They have to get out into the hospital. Instead of asking "What can you do for the lab?' they have to ask, "What can the lab do to make your role easier?' This can take the form of going on rounds, serving on hospital committees, or networking--just getting out, meeting peers, understanding the functions of others.

"Another trend is the greater emphasis on management training. The traditional medical technologist who climbed from the ranks and got into a supervisory or lab manager's position by seniority is less and less common. To complement a laboratory background, I would prefer an equal emphasis on management training --say in finance, general management skills, and marketing.'

Patricia Lynch, executive vice president and chief operating officer of 201-bed Union (N.J.) Hospital, agrees that qualities sought in laboratory managers have changed considerably from pre-DRG days. "Today, they must have a very good understanding of the hospital's financial situation. They have to be able to put together profit and loss statements. They have to be statistically oriented, identifying trends and initiating statistical sampling studies that they can follow up on.

"In addition, they face the problems all managers must deal with: recruitment and retention, which are more difficult today; doing more with less and maintaining high quality; a substantial amount of paperwork. . . . In short, we want not just someone who is good at the bench but a top-notch "people' and paper-and-pencil kind of person.'

Management education and experience help form an individual's skills, Lynch says, and a management job should strengthen those skills; one can stretch managers by giving them enough to do. Union Hospital has a decentralized organization. Department heads bear a lot of responsibility and accountability, they frequently come into contact with the finance department and other key hospital areas, and they work closely with other department heads. All of this enhances their understanding and their problemsolving abilities over time, in administration's view.

Lynch is talking not about on-the-job management training but rather about job activities that bolster skills already formed. Richard Giorgino, associate administrator and chief operating officer of 206-bed Columbus Hospital, Newark, criticizes the on-the-job training approach taken in many hospitals. "If you're there long enough and are loyal to the institution, they're going to promote you to a supervisory or management position, whether or not you have strong management skills. Maybe what we need are programs geared to giving new managers some training in management, specifically for the lab.'

Giorgino thinks it would be a waste to teach management to undergraduates majoring in medical technology. "It will take several years on staff before any of them move up to a higher position. In the meantime, they would probably forget everything they learned about management. That training has to come later as part of their continuing education.'

Sharon Minogue, vice president of clinical services at 416-bed Robert Wood Johnson University Hospital, New Brunswick, N.J., ticks off a quick list of skills and traits sought in a laboratory manager. "You need someone who has good management and leadership ability, independence, initiative, flexibility, and creativity. Health care is dynamic, and we have to adapt to a changing environment. One of the national problems we are experiencing in laboratories is tremendous staffing shortages. It takes somebody with a lot of strength and character to keep the lab operating.'

At 916-bed Beth Israel Medical Center in New York City, assistant director of operations Louis Liebhaber gives his specifications for a good laboratory manager: "One is a clear commitment to quality in the lab, particularly in a hospital environment. Quality will clearly affect results, patient care, and our ability to move patients through the system. The lab manager must have a nondefensive posture toward customer service, recognizing that doctors and patients are our customers. Their complaints, concerns, and needs must be directly addressed in a spirit of cooperation.

"Then there's the ability to identify, recruit, and retain good technical staff. In my experience over the last 10 years as a senior hospital person responsible for laboratories, it is a tough market for acquiring and keeping good staff. The lab manager has a great deal to do in that regard.

"We also want someone who will assume a leadership role in cost-effective operation of the laboratory, including selection and purchasing of products, and the tradeoff between automated instruments and staffing. Another area, laboratory utilization, has become much more important in the DRG environment. The laboratory manager must be able to work with clinicians in reaching decisions that allow the laboratory to be involved in the ordering process and in setting up mechanisms to insure that things like repeat orders are kept to a minimum and that turnaround time is as rapid as possible.'

Like the other administrators we interviewed, Liebhaber rates management skills at least as highly as technical background. He points out that the Beth Israel laboratory budget is about $10 million a year. "That's the total budget of some 200-bed hospitals, and it's a big piece of any hospital's operation. Those resources are largely within the laboratory manager's control. He or she has to know how to manage them effectively.'

Finally, we asked a member of MLO's Editorial Advisory Board to comment. Thomas A. Blumenfeld, M.D., a pathologist who serves as vice president for medical affairs at New York's 1,300-bed Presbyterian Hospital, Columbia-Presbyterian Medical Center, says the future in laboratory administration belongs to "hybrids': "I have favored people who have a degree in medical technology as well as a master's degree in business or health care administration. It has not been difficult to find them, and I think it has been rewarding. You pay more, but you get a lot more. Most of my laboratory administrators have a bachelor's degree in laboratory medicine as well as an M.B.A. or a degree in health care administration.'

In evaluating the performance of laboratories and lab managers, administrators consider such factors as ability to meet budget, cost and revenue trends, productivity, turnaround time, and clinicians' satisfaction with lab service.

"I would put productivity first, followed by turnaround,' Lynn Nemeth of Atlantic Health Systems says. "If you manage those things well, your costs and clinician satisfaction will follow.'

Beth Israel's administration reviews the hospital's cost per test data versus comparative figures from similar hospitals (this, is compiled periodically for Beth Israel by its auditing firm). It looks at College of American Pathologists workload statistics to evaluate productivity of each lab section and the lab's productivity versus that of other labs.

Liebhaber also mentions creative cost-saving measures as a criterion for judging laboratory management. He cites as an example a move to automate in hematology by shifting from a five-cell differential count to a three-cell differential, which led to a staffing reduction.

One way Beth Israel monitors "customer satisfaction' with the laboratory is through rounds conducted by a pathologist, a clinical pathology resident, and a section supervisor. Each floor of the hospital is thus canvassed about once every three months. The supervisor records problems cited by residents, nurses, and patients and prepares a report for administration, noting how the lab is following up. In addition, roundtable discussions give attending staff and residents a chance to voice concerns and ask questions about the lab and other departments.

Union Hospital's Patricia Lynch says three "hot spots' in her institution constantly receive physician attention--nursing, the laboratory, and radiology. "When physicians feel good about the laboratory, their ordering habits improve. If they don't feel good, they order more tests and more Stats to compensate for that. We have run a quality lab, and the indexes of over-ordering, extra Stat ordering, and complaints have dropped markedly.'

Physicians need test results back more quickly than they did before DRGs. On this subject, Lynn Nemeth of Atlantic Health Systems says, "To have an absolutely accurate result that is not timely and therefore not useful isn't the name of the game anymore. You have to have a healthy balance between the two. I think this a hard adjustment for laboratorians to make because many of them are scientists by nature.'

And Dr. Blumenfeld of Presbyterian Hospital has the following to say about quality: "Quality control is not the issue that it was in the past because we have better analyzers and control systems. There should not be a quality control issue in laboratories that are of reasonable size and have reasonable staffing. I would be most surprised if you looked at their quality control reports and didn't find that they were practicing excellent laboratory medicine. However, if you have mediocre specimen collection and transport and you deliver a poor specimen, the best laboratory in the world is going to produce meaningless or erroneous test values.

"If we really want quality, we have to address specimen collection and transport. It has not been given proper emphasis, and it is the largest variable that we have the least control over. I feel very strongly about having the specimen collection personnel report to the laboratory because to me laboratory medicine begins when the physician orders the test and ends when the results are in the physician's mind.'

To varying degrees, the surveyed hospitals monitor physicians' use of the laboratory and other resources, commonly with computer assistance, and employ protocols designed to make test ordering more efficient. But utilization control soon bumps up against limits, according to two administrators.

"Even though we monitor physicians' ordering patterns, we have not found any significant abuse,' Dr. Blumenfeld says. "Utilization needs to be monitored, and we need to be concerned about, it, but I think it is a mistake to devote a tremendous amount of energy to it. It is better to put your energy behind cost cutting in other areas.'

Sharon Minogue of Robert Wood Johnson University Hospital comments: "We are stuck between a rock and a hard place. We think the number of lab tests are high compared with our reimbursement. On the other side, physicians caught in the malpractice war are practicing conservative medicine. Our hospital is examining these physicians' ordering patterns.'

Turning to lab staffing, problems in recruitment and retention kept coming up in the interviews. As Minogue put it. "We have lost some good people to reference labs. We get into the money issue and the issue of hours. If you're a family person, it's much nicer to work Monday to Friday and have holidays off than it is to work alternating shifts in a hospital; every other weekend, and half the holidays of the year.

"We also have a stress level that is increasing, particularly since we developed into a university teaching facility. Our patient acuity has changed. We are doing more complicated tests, and we need faster results. People tax the lab a lot more than they did in the past. In addition, there are just not as many medical technology schools as there used to be. And alternative health care programs present graduates with more opportunities to go into nonhospital types of laboratory work.'

Minogue notes that her hospital tried and had to give up a policy of not filling open positions in the laboratory. "It didn't work based on our volume of activity.'

Hospital laboratory staffs are coping with more inpatient and outpatient testing than ever before, several administrators remark. "The fallacy inspired by DRGs was that you would be able to reduce testing, but the opposite has happened,' Dr. Blumenfeld says. "We have put great emphasis on decreasing length of stay. In order to do that and have the same percentage of occupancy, you must have more admissions. The vast majority of laboratory tests are ordered in the first two days of the admission--after that, orders fall off greatly. What we have done, then, is cut off the end where the laboratory work was light and drastically increased the number of admissions, which are the source of testing. With the emphasis on ambulatory care, outpatient test volume has also risen. All of this has a major impact on laboratories' workload, even though we try to keep up through automation.'

Richard Giorgino of Columbus Hospital says his hospital's laboratory has added "one or two positions' in the last two years. Staffing had gone up "dramatically' about three or four years ago when there was a sudden surge in volume. Any new instruments acquired by the laboratory are automated, and that has helped keep the staffing level stable, according to Giorgino.

According to Louis Leibhaber, two developments that led to significant staffing reductions at Beth Israel's laboratory were the switch to a three-cell automated differential count in hematology and a better alignment of staffing by shifts to test demand. The latter resulted from a review of computer reports on staffing and workload patterns.

The tradeoff between automation and labor is one factor administrators take into account when evaluating capital expenditure requests from the laboratory. "We look at the effect of these items on critical issues like staffing patterns, turnaround time, and total laboratory costs,' Liebhaber says. "We also consider a proposed instrument's ability to interface with our computer resource. Results from interfaced instruments are screened on a CRT in the laboratory just to make sure they are appropriate and within bounds. Then they are passed over to the hospital computer and are available on terminals on many of the floors.'

He has some advice for any laboratory manager hoping to better the chances of approval for a capital spending request: "Get administration involved as early as possible. Give them a good understanding of what the effect of the item would be and what the alternatives are. Make a proposal that is financially sound, one that demonstrates good tradeoff in terms of productivity, staffing, and turnaround time.'

Richard Giorgino says: "With replacement of existing equipment, laboratory management has to show it is obsolete with a poor repair record--either the service contract or the repairs are costing a fair amount of money compared with what it would cost to lease a new unit. That's one of the criteria I use. Basically, you work with those types of issues--how old the equipment is, repair records, whether reagent cost will go up or down with the new equipment, the effect on labor.

"As for an instrument that would provide a new service, you have to show there is a demand for it. The argument used to justify it might be that we're sending out a lot of specimens or there are problems with the medical staff because we're not getting the results back quickly enough.'

Patricia Lynch adds another factor--the potential of a new instrument to generate added revenue. She adds: "The smarter and more capable that laboratory managers are in providing administration with numbers that are real and reflect trends based on actual performance, the more likely they are to get what they ask for.'

The laboratory manager has to prepare a profit and lost statement indicating the economic feasibility of a proposed instrument acquisition, Lynn Nemeth states. "It used to be enough simply to say we need to replace what we have because it's seven years old. Those days are gone forever.'

"The better the justification on why you need it and the more education you can provide to the administrator to make your case, the more successful you are going to be in getting capital,' Sharon Minogue says. She feels reagent leases are going to be more prevalent in the future.

Dr. Blumenfeld takes up that point. He is chairman of the capital budget committee for Presbyterian Hospital. "Should this really be acquired on the capital budget?' is one question he asks about instruments proposed for the laboratory and other areas where the technology is rapidly changing. "If we buy the instrument, we are locked into it. Suppose something better and more efficient becomes available that would really help the operating budget? I have to be totally convinced that it is best to acquire an instrument on the capital budget and not through some other means. Of course, on the other side you have to be careful as to how a lease impacts on your operating budget.'

One sound investment for any hospital and its laboratory is a computer system, Dr. Blumenfeld feels. "The product of the laboratory is information, primarily in the form of numbers, and I can't imagine a lab without a major information tool. To me, that tool is as important as the analyzer. To spend a lot of money getting the specimen, rushing it to the laboratory, and turning it into numbers, then to say, "Now we are going to spend lot of time getting it back to the initial source' appears to me to be very fuzzy thinking.'

That concludes our look at laboratory issues from the administrator's perspective. In Part II, which follows, we'll examine new directions these hospitals and their labs are taking.
COPYRIGHT 1987 Nelson Publishing
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Title Annotation:Part 1
Author:Benezra, Nat
Publication:Medical Laboratory Observer
Date:May 1, 1987
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Next Article:New ventures multiply for hospitals and their labs.

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