Saving Time and Money Through Automation

How McKesson’s Lab SD2 can improve your facility’s business performance

Patient care is the heart and soul of any healthcare facility or hospital. But it becomes exceedingly difficult to provide top-notch care when there are issues with business performance. 

When the Health Industry Distributors Association released their 2018 Laboratory Market Report, their finding that approximately 30 percent of hospitals were losing money sounded an industry-wide alarm.1 Aside from the patient care-related fallout of a hospital losing money or being forced to close, the effect on a community can be profound when facilities are also a leading provider of jobs and opportunities for residents. 

Rural areas can be particularly hard-hit, especially when a Navigant analysis found that 21 percent of rural US hospitals are already at high risk of closing.2

How can laboratory managers address the growing problem? Physicians strongly agree that investment in lab technology leads directly to cost savings, increasing revenue, and improving patient care in turn. The value of quality lab work and proper, efficient blood test results are of immeasurable value to patients. Giving your lab employees every opportunity to provide such impeccable results should be the top priority of every manager.

With the new McKesson Lab SD2, managers can now extend the workplace capabilities of their staffs while enhancing critical quality metrics. McKesson Lab SD2 is powered by Data Innovations® and with the support of industry experts to help laboratories standardize and optimize their processes via a user-friendly interface.

Lab SD2 is easy to connect and offers readily available consultation from highly trained LEAN Six Sigma certified experts. But the auto-verification capabilities may be the software’s most attractive quality. Labs facing staff and cost containment challenges see hundreds of work hours returned to the facility in the form of higher-quality results, reduced turnaround time, and other features.

Wayne Memorial Hospital in Honesdale, PA, recently implemented SD2 in their laboratories. John Romano, laboratory manager at the facility, noticed results right away.

“It made a tremendous impact on productivity within days,” said Romano. “We were able to achieve auto-validation of 86 percent of our laboratory tests almost immediately.”

And that was just in the first several days of implementation. A February 2016 questionnaire revealed auto verification rates in excess at 90 percent in laboratories nationwide.4

Romano’s laboratory performs almost 1.5 million tests on an annual basis, so to achieve 86 percent auto-validation so quickly meant an immediate and decisive increase in staff productivity. 

“Instead of feeling chained to a computer terminal releasing results, our technologists are free to work on other required elements of laboratory practice,” he said.

Indeed, most clinical labs spend more than half their time reviewing test results—results that are typically 95 percent acceptable, according to a 2016 industry study.3 The systematic, repetitive process can lead to staff fatigue and shortages, slow turnaround times, and an increased potential for errors. Lab SD2’s auto-verification feature means results are interpreted automatically, expediting the release of acceptable values. The auto-verification module is customizable to any laboratory or provider’s needs and eliminates concerns over inadequate resources.

McKesson’s technical team is available to help ensure the quality of auto-verification via the SMART TESTS design process, including:

  • Managing the implementation project and providing on-site training
  • Assisting with writing, customizing and optimizing auto verification algorithms
  • Running on-board simulators and test scenarios to pre-validate algorithms and rules
  • Designing department-specific screens and dashboards for streamlined exceptions review and optimal laboratory management

In the end, this means that the amount of time spent reviewing results—well over 50 percent of available hours, and often closer to 65-70 percent4—is reduced to a number in the single digits. This difference becomes re-deployable labor resources for laboratories in need of manpower, like John Romano’s lab at Wayne Memorial. 

“Our experts can spend more time on the ‘problem’ patient specimens, putting their expertise to good use,” Romano said. “Critical results are flagged for review by the technologists, but in a fashion that does not leave them buried in other, normal results.”

The SD2 Solution to Labor Shortages

News reports are rife with strong numbers in the jobs market—but for some reason, word hasn’t spread to the laboratory profession. A 2016 report showed over 330,000 open positions nationwide. That number is expected to approach 400,000 by 2026.4 Combine that with the fact that the average US laboratory professional is 53 years old5, and even that estimate may be conservative.

Of course, ‘doing more with less’ isn’t a new concept to American businesses, but is that reality in laboratories? Not according to the figures that show 65 percent of available work hours dedicated to reviewing lab results.4 What’s more, further time is wasted in finding a specimen (an average of 12 minutes per case)4 and upkeep of maintenance logs—a whopping 95+ percent of which are paper-based, even in today’s digital age.4 The vast majority of labs are ill-equipped to manage their operations via dashboards or other technological means effectively.

Add it all up, and you get a frustrated, fatigued staff prone to human error and employee turnover, which costs time and money in terms of training replacements drawn from an already-lacking field of applicants, and an increased risk of mistakes due to inexperience. Shockingly, medical error is now the third leading cause of death in the United States, as reported by the BMJ (known initially as the British Medical Journal) in 2016.6

Think about that statistic, and it’s almost appalling that less than 2 percent of labs nationwide can claim a rate of 90 percent of higher autoverification.4 Is it too expensive? Are the figures unreliable? For answers, let’s take a closer look at John Romano’s laboratory department at Wayne Memorial Hospital.

The hospital has 98 acute care beds, plus another 14 beds dedicated to inpatient rehabilitation. Serving a population of 100,000 people across Wayne and Pike counties in Pennsylvania, the hospital is the crown jewel of the Wayne Memorial Health System.

Romano’s first challenge came via staffing vacancies. Specifically, he was down two full-time medical technicians. In an environment where the current staff was spending almost 250 hours per month reviewing test results, these vacancies had a considerable effect on the lab’s turnaround time (TAT) on tests.

Compounding matters was a directive from hospital leadership to cut costs where possible in every department. Romano was facing a crisis in terms of improving TAT and patient satisfaction, attempting to accomplish this with two vacant full-time positions, and a less-than-optimistic outlook on hiring replacements. 

Enter SD2, which offered not only the aforementioned auto-verification but archiving capabilities along with maintenance management and real-time dashboards to run management reports for multiple laboratories. 

Through labor reallocation, a reduction in phone calls and employee overtime, and the ability to hire new grads with biology degrees rather than MTs, Romano and Wayne Memorial realize a time savings of over 500 hours per month and cost savings approaching exceeding $250,000 annually. The lab also saw corrected reports cut by more than half and a TAT reduction of 30 percent. 

What did Wayne Memorial Health System get for their ‘trouble’? Only happier employees, fulfilled leadership initiatives, and increased patient satisfaction.

“The visible reduction of stress was one of the most immediately visible benefits of this new software,” summarized Romano. “Now our technologists don’t have to be concerned about getting all the work done—they have ample time to complete their duties. From a management standpoint, I no longer worry about adequate staffing or specimen processing. SD2 completely changed our laboratory in a very positive way.”  

For more information on how McKesson’s lab solutions can address your challenges, visit


1 HIDA, 2018 Laboratory Market Report

2 Commins, J. Financial Woes Threaten Closures for 1-in-5 Rural Hospitals. 20-Feb-19.


4 Marquardt, B. Labor and Cost Containment are Lab’s Biggest Issues.


6 Makary, M., Daniel, M. Medical error—the third leading cause of death in the US. BMJ 2016;353 published 03-May-2016.

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