Benchmarking your lab performance the right way

Myra Wilkerson, MD, FCAP:

Benchmarking can be a real problem for people, or it can be a great tool for people as well. The problem that you want to avoid is accepting the institutionally imposed benchmarking, the kind that your CFOs want to see. They like broad national companies who do high-level benchmarking, but the problem is that they usually don't have the expertise that you need for laboratory medicine. They're more concerned about clinic workflows, throughput in your emergency departments, length of stay in your wards, the productivity of nursing, et cetera. They really don't understand laboratory medicine and the subtle differences between institutions, whether you're involved in blood management, do you do your own apheresis? Do you run your own couriers? It's understanding those subtle differences and understanding how you're benchmarked, and who your true peers are. And so, my one piece of advice is never to settle for the benchmarking that has been imposed upon you. Really fight back and insist on the benchmarking that when you talk to a company, you know that they understand the laboratory performance. They specialize in laboratory benchmarking.

You want to look at things like not just the productivity, which is what your CFO is going to hold you accountable for, and whatever benchmark you accept, you're going to have to be benchmarked on that for a minimum of five years before your institution is going to go through benchmarking again. So, you want to look for a company that says it's yes, worked hours per billable test. That's one of the most common benchmarks. But can they really separate that out into bench-level productivity versus the amount of management that you have? And what is appropriate management for the type of system that you're in or the type of laboratory that you're in? Are you a single laboratory? It's much easier to benchmark than if you're multi-hospital, multi-physician office-type laboratory setting.

You want to know about your supply chain benchmarks. Do they have suggestions for you on how you can aggregate maybe across your system, how to maybe be part of a group purchasing organization? Do they have suggestions on how that's been done successfully? Then you want to look at your reference lab spend. How many reference labs do you use? What do your contracts look like? How do you benchmark in your patient population and the level of service that you're at? How do you benchmark against other similar institutions? And then how does your reference lab or your supply chains benchmark at your individual site level, not just in aggregate; that you need it broken down by individual site, and you need unique ranges for productivity for each individual site.

A small hospital laboratory that's really open 24/7 just because you have an emergency room that you have to support with stat testing will never be as efficient as a large core laboratory. So, you need appropriate efficiency benchmarkings for a site like that that doesn't have a choice in minimal staffing levels. They're already at minimal staffing. What else can you do at that site with those employees, and how do you compare to other sites like that? If you only have 10 FTEs in a clinic site, you have to know that they're being benchmarked appropriately on test volume.

You also want recommendations from what an essential test menu is at a site based on what specialties you're supporting. We like to start with the WHO Essential Test Menu. They just released that in May, their latest updated version. You start there and then you look at other specialties that you're supporting at that site. It's not just a cookie cutter approach that every single rapid response laboratory or small hospital laboratory is offering the exact same menu. It's also about how they are customizing it for local needs to make sure that they're supporting the local clinicians and local patient care.

What is your local market? What are opportunities in your market? A market assessment should also be part of your benchmarking if at all possible. Because again, if you've got capacity, even at a minimally staffed lab, you probably have capacity to maybe be able to do outreach work to support a local nursing home, or a school system, or a prison with testing that they could use that would help offset some of those costs; that high overhead associated with low test volumes, but the requirements to maintain a minimal staffing 24/7. So, those are some of the things you really do have to fight back against, the one size fits all benchmarking that you're going to get with a large national company.