COVID-19 Business Intelligence and Analysis for Clinical Laboratories, Pathology Groups and Hospital Administration

COVID-19 Briefings

Reliable COVID-19 Business Intelligence and analysis for clinical laboratories, pathology groups and Laboratory Diagnostics.

Revenue Experts Give Insights Into How Clinical Laboratories Should Plan for the Future

Questions about COVID testing

Clinical laboratories should plan now for surviving a sustained downturn in COVID-19 testing revenues. While there is potential for some forms of continued COVID-19 testing in these labs, there may reside new assets with a value unrealized

As the COVID-19 pandemic passes its one-year anniversary in the US, new indications are that the development and use of vaccines, and other public health measures, are moving the pandemic into its next phase. COVID-19 testing levels have been decreasing since mid-January, and many states are loosening spread-mitigation measures.

With employers, lawmakers, healthcare providers, and clinical laboratory leaders planning and discussing returning to a more pre-pandemic normal, clinical laboratories may face a continued reduction in the revenue that COVID-19 testing has provided. This shift in the clinical laboratory industry could offer new opportunities, but it could also lead to potential damages if not handled proactively and correctly.

To better understand what a sustained drop in COVID-19 testing and revenue means for clinical laboratories, STAT Intelligence Briefings spoke with Mick Raich, CEO of Vachette Pathology, and Josh Yelen, CPFA, MBA/HA, MAccy, Vice President of Revenue Cycle Strategy for Vachette Pathology. Vachette Pathology is a revenue-focused consulting group that helps clinical laboratories manage and strategize their revenue.

COVID-19 testing is definitely on the decline, says Yelen. This is a trend that has been observed in clinical laboratory data reports regularly updated on the STAT Intelligence Briefings on COVID-19 website. It is a trend that is expected to continue. “We saw it between January and February,” Yelen said. “Nationally, we saw a 25% decrease in COVID testing. It’s going to continue probably on that slope, maybe not as exponentially, but it’s definitely going to go down as more people get vaccinated.”

While vaccines are one factor affecting COVID-19 test volumes, another is the changing approach that payers are taking about COVID-19 screening tests. “The big question right now is screening tests in public health. Say you have a plant with 5,000 people and you want to test everyone, who pays for that?” continued Raich. “What’s going to happen is insurance plans are not going to pay for that. Just as they won’t pay for twelve PAP smears, and they won’t pay for twelve mammograms—they pay for one per year—we are going to reach that. And I think that is what’s driving the decrease in testing right now. Payers are starting to say ‘No’.”

Significant Reduction in COVID-19 Testing Prompts Question: What’s Next for Clinical Laboratories?

As COVID-19 testing declines, planning for what comes next is vital. “You have labs with infrastructure. You have people, equipment, reagents, space. The question is what are you going to do next? What are you going to do to fill that pipeline?” Yelen asked.

Mick Raich, Vachette Pathology

According to Raich, COVID-19 testing will never go away, but clinical laboratories may need to adapt as the space changes “There’s going to be something next,” Raich emphasized. “Maybe the bigger question here is, as testing volumes are down, is testing going to completely go away? I don’t think so. There will be all these different variants that you want to test for. There will be even more new variants. I think part of the national narrative is that we have to be vigilant because it’s not over yet.”

Raich also suggested that as clinical laboratories consider offering variant-based testing, they could also consider focusing on offering antibody testing to people wanting to know if their vaccine did indeed create an immune response. Raich predicts antibody testing will become an emerging market for clinical labs.

Advice for Clinical Laboratories Considering a Sustained COVID-19 Revenue Downturn

One of the biggest recommendations that Raich and Yelen has for clinical laboratories is that they carefully plan their forward-looking strategies using the additional revenue from COVID-19 rather than allowing this revenue to be wasted.

“Do you use your bolus of cash from COVID to make you good in 2022 and 2023, or did you just take it and waste it?” Raich asked. “That’s what we’re seeing. It’s kind-of like the Nucor Steel model, where when times are bad, Nucor Steel doesn’t lay anybody off; they just cut their hours back. They save money up and buy new machinery. So when the economy recovers, they’re fastest out of the gate.

“We’re going to see that with labs that have made good money on COVID,” Raich continued. “Some of them are going to really double down on investing in their marketing, sales, and infrastructure. And they’re going to come out really strong. Other labs are going to sunset as COVID fervor sunsets.”

Added Yelen, “There are labs making an incredible profit margin right now—incredible profit margins—and their paid partners are going on vacation. They are enjoying the fruits of their labors now. But that profit center will crumble. Then there are other labs saying, ‘Look, the money’s great but we know it’s not forever, and we want to move into next-generation technology. Where should we be headed? Help us plan.’ And so those are the labs Vachette likes to work with.”

As the pandemic begins to shift into its next phase, clinical laboratories would do well to consider how they will use the additional revenue that COVID-19 has generated to build their future.

New perspectives on clinical laboratory testing beyond the surge of COVID-19 diagnostics are featured in a March 31, 2021, webinar, hosted by Dark Daily.

How Clinical Labs Can Build from COVID-19 Testing

Sharing new perspectives on potential strategies for post-pandemic operations are Jamie Platt, PhD, MB (ASCP), CEO and Founder of BRIDGenomics, LLC; Andrew Warren, PhD, of Third Rock Ventures; and Barry Wark, PhD, CEO of, for a look at how the lab’s current testing for COVID-19 creates assets for the future. Titled “Life After COVID: Positioning Your Lab for Success in a Post-Pandemic World,” this webinar features a question and answer session, these key learnings, and more:

  • How a new population of COVID patients will accelerate drug discovery and drive life-science companies to find new, more integrated ways to collaborate with their laboratory partners;
  • Why and how demand will increase for data and follow-on molecular testing; and
  • Practical steps a clinical lab can take now in order to take advantage and leverage its COVID-19 sample data as a strategic asset—including systems and processes that need to be in place.

Laboratory leadership from any laboratory that is performing COVID-19 testing and from academic medical centers, as well as molecular laboratory owners and managers, are among those who should attend.

Register for the free webinar here.

—By Caleb Williams, Editor, STAT Intelligence Briefings on COVID-19

Related Resource:

Webinar: Life After COVID: Positioning Your Lab for Success in a Post-Pandemic World