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Anatomic Pathology’s Latest Transformation: Local Practice Consolidation, More CP Testing, and Regional Anatomic Pathology’s Latest Transformation: Local Practice Consolidation, More CP Testing, and Regional "Test Exchange Networks" (Lab. TEN™) Lisa-Jean Clifford Chief Executive Officer 1(800)345 -1514 ext. 357 [email protected]hesystems. com

Lab TEN™… n Definition – The Birth of a Concept – Partnering within a Lab TEN™… n Definition – The Birth of a Concept – Partnering within a region to segment specialized testing, increase business and minimize competition by utilizing a unified database and test exchange network Industry Need/Expansion n Business Model n – From the customer’s perspective, it’s invisible – The labs are distributing the testing among themselves n Leverage Risk/Leverage Benefit

Is Partnering Necessary? n Understanding Your Needs – Ask the questions of your facility Is Partnering Necessary? n Understanding Your Needs – Ask the questions of your facility – what are your goals? What are you looking to accomplish with this program? n n n Maintain Test Volume Increase Quality of Patient Care Increase Efficiency and Accuracy Lower Cost Customer Service

Evaluate Concept Identify Lab’s Overall Goal n Is It Right For Your Lab? n Evaluate Concept Identify Lab’s Overall Goal n Is It Right For Your Lab? n – Goals – Potential partners vs. competitors n Challenges – Finding interested parties/early adopters for the concept of a unified, combined database n Benefits by Scenario – – Start-up lab Survival Low cost or minimal investment for growth Position for acquisition/exit strategy

Define Requirements n n n n n Web-based, 24/7 Anywhere Access Secure or Defined Define Requirements n n n n n Web-based, 24/7 Anywhere Access Secure or Defined Access Rights Streamline Efficiency Automatic Routing Online Ordering and Result Retrieval Immediate Order Status Tracking Shared Cost of LIS or LIS Support Costs Offer Faster, Higher Quality Results and Reports Improve Time to Reimbursement or Leverage Instruments with Improved Test Turn Around Times

Determine Reporting n n n Responsibility for Providing Correct and Timely Results Lies on Determine Reporting n n n Responsibility for Providing Correct and Timely Results Lies on Each Partner Lab Report Customization – Include images, charts and graphs, branding Serving the Patient and Customer Single Report – Combined Results – Look to combine full patient information, clinical, pathology and molecular results along with patient history and demographics on a single report Report Branding and Responsibility Need to be Clearly Defined Upfront

Identify Objective/Scenario n Which Scenario? – Start-up – Survival – Resource Constraints or Maintain Identify Objective/Scenario n Which Scenario? – Start-up – Survival – Resource Constraints or Maintain Market Share – Growth – Gain Market Share, Grow Revenues – Exit

Scenario 1 – Startup… n Laboratory ABC – Start up – Problem – Goal Scenario 1 – Startup… n Laboratory ABC – Start up – Problem – Goal – Solution

Scenario 2 – Survival n Laboratory ABC – Survival – Problem – Resource Constraints Scenario 2 – Survival n Laboratory ABC – Survival – Problem – Resource Constraints – Goal – Solution

Scenario 3 - Survival n Laboratory ABC – Survival – Problem – Maintain market Scenario 3 - Survival n Laboratory ABC – Survival – Problem – Maintain market share – Goal – Solution

Scenario 4 – Exit n Laboratory ABC – Exit Strategy – Problem – Goal Scenario 4 – Exit n Laboratory ABC – Exit Strategy – Problem – Goal – Solution

Get Started n Lab Evaluation – Equipment, Staff, IT Infrastructure, Experience n Business Goals Get Started n Lab Evaluation – Equipment, Staff, IT Infrastructure, Experience n Business Goals – Buy-in from other departments/management n Determine Technology Requirements – To achieve business goals – To accomplish goals defined with partner

Next Steps n Determine Measurement for Success – Each lab may be unique in Next Steps n Determine Measurement for Success – Each lab may be unique in requirements – Must understand each partners’ objective for successful relationship n Evaluate Vendors – Does lab(s) have an LIS – Can it accommodate with necessary functionality n Re-evaluate - this is a continuous process – reevaluate and adjust as each milestone and goal is reached

Can You Handle It? n Infrastructure – Are you set up to accommodate additional Can You Handle It? n Infrastructure – Are you set up to accommodate additional space, equipment and staff requirements? Will it be located within, or separate from your facility? – Have you planned for the staffing requirements to include sales and marketing? – Incremental business model and needs a full business plan to be successful n Lab’s Testing Capabilities – Are you looking at pushing out larger quantities of the tests you already do or increasing your test menu? – You need to plan for the impact of increased testing and volume on your equipment, reagent supplies, etc.

Marketing Maintaining Customers – In order to grow your customer base, you need to Marketing Maintaining Customers – In order to grow your customer base, you need to maintain your existing customers – It is less expensive to keep an existing customer than to gain a new one n Growing Customer Base – You need to demonstrate success to gain new customers – this is done through your existing customers – Marketing your lab business like any other business – find your strength and exploit it. Do you offer better turnaround times? Do you offer a specialized test that few other labs can offer? n Increasing Test Volume – Bringing on new customers and increasing your business increases your test volume, promote your success and the number of tests you can offer with low turnaround times, volume fee discounts, etc. n Indirect Support of Your Bottom Line n

Case Study… n Laboratory – Test Exchange Labs, Inc. – Problem • Lab is Case Study… n Laboratory – Test Exchange Labs, Inc. – Problem • Lab is faced with competition for business, increasing test volumes and physician clients but they have very little budget, infrastructure and a limited test menu. – Goal • The goal is to trade their individual weaknesses for combined strength and profitability through intelligent test routing, volume management, and cohesive sales and marketing for their specialties – Solution • To establish the means to provide the back-end integration and automation of the process while leveraging the current investments already made at each facility