A-206 Exploring the Surge in Clinical Laboratory Inflation: A Comprehensive Review

Abstract

Abstract Background The healthcare industry has been experiencing significant inflationary trends, particularly in clinical laboratory services. This surge in inflation is attributed to various factors, including the increased demand for laboratory services, changes in the practice of clinical laboratory science due to technological advances, and vacancy rates that exceed the number of Medical Laboratory Science (MLS) graduates. Additionally, supply chain shortages, increased operational costs, and staffing budget increases, further exacerbating the inflationary pressures on clinical laboratory services. Methods The review of the factors behind the surge in clinical laboratory inflation involved a comprehensive review of industry data and insights from supply chain leaders, and recent surveys conducted by the author sent to 50 laboratory leaders with a response rate of 50%, Data from the Bureau of Labor Statistics (BLS) and industry interviews were integrated to provide an understanding of the inflationary trends affecting the healthcare industry, with a specific focus on clinical laboratory services. Results The review revealed that domestically produced healthcare inputs, labor, diagnostics, and lab equipment have seen dramatic price increases. For instance, prices manufacturers charge for diagnostic reagents for testing have increased by 9.2%, while lab equipment prices have risen by 7.1%. Some product lines have experienced increases of 15-20%. Moreover, the post pandemic has led to attrition rates climbing from 10%-37% to the current rate of 35%-61%, resulting in 30%-50% staffing budget increases. 36% of lab leaders feel Group Purchasing Organizations (GPO’s) are incentivized to allow increases, it’s estimated that as much as 80% of GPO revenue is generated by fees paid by vendors. 28% feel the vendors are passing along but not sharing in the inflationary pressures as reimbursements decline. 20% feel it’s an excuse for vendors to pad margins. 16% feel that it’s due to lack resources or lab specific procurement expertise in supply chain departments. Conclusions These factors have contributed to the significant surge in clinical laboratory inflation. The surge in is a complex phenomenon influenced by multiple interconnected factors. Addressing this inflationary trend will require a collaborative approach that considers the impact of supply chain shortages, increased operational costs, and staffing. Proactive measures to mitigate the adverse effects of inflation on clinical laboratory services, such as ensuring reliable data in negotiations, addressing the workforce shortage and strong negotiations with vendors will be essential to sustain the cost, quality, and accessibility of these critical healthcare services.