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Tiffany Bratton lab consultant portrait

Dr. Tiffany Bratton’s 4 suggestions for labs in 2023

Board-certified in clinical chemistry and histocompatibility, Tiffany Bratton, PhD. is an accomplished leader in the clinical lab space with extensive experience in healthcare administration, business strategy, and clinical diagnostics. Dr. Bratton has played key roles in establishing early commercial molecular labs and various laboratory businesses.

In 2020, she founded Bratton LabWorx to provide expert guidance for independent specialty diagnostic labs. Their track record of successful commercialization strategies has led to revenue increases of over $10 million for companies such as Grifols, Immucor Inc., One Health Laboratories, Helix Diagnostics, and Bluewater Laboratories.

The State of Independent Labs in 2023

With COVID-19 testing volumes drastically falling and President Biden’s announcement for the end of the Covid-19 Public Health Emergency on May 11, independent reference labs are looking for alternative revenue streams. The situation looks especially dire for small, startup labs. An increasing number of labs have shut down indefinitely or are going through an M&A process. Add to the mix continued downward revenue pressure from payers, and the central theme here is market consolidation. 

Amidst all of the chaos, the data is clear: most clinical labs that are still in the game are converging on the same few strategies. Many are re-utilizing their existing PCR equipment and targeting molecular assays for UTIs, respiratory illnesses, and wound/nail fungus testing. Pharmacogenomics (PGx) testing is also picking up in popularity. The explanation is that there just aren’t many other obvious options. 

In 2023, there are two common post-COVID pivots. The first is becoming a “full-service lab” by offering automated chemistry and immunoassays. The other is expanding molecular infectious disease testing

If this describes your lab’s strategy then be prepared for a new level of competition. While official statistics about the number of high-complexity labs are unavailable, according to the Centers for Medicare and Medicaid Services (CMS), the total number of CLIA labs increased by over 50,000 from before the COVID pandemic to February 2023. Data from Lab Prospects shows that there are over 1,900 independently-owned high-complexity lab facilities open in 2022. We expect that a large portion of these newer laboratories will be trying to make the same pivot. But compared to COVID, there simply is not enough volume of these types of tests to sustain the crowded diagnostic laboratory market.

“The lab giants will undercut you every time. A ‘me too’ strategy is not going to bring in revenue. What can you do that no one else can?”

1. Don’t Go “Full-Service” Without Scale

It’s a well-known reality that even high-throughput hospital labs can be unprofitable. By expanding your lab’s test menu to be “full-service”, will you be able to attract enough volume to make your business sustainable?

The reality is that the lab giants (LabCorp, Quest, etc.) will always have significant cost advantages due to massive economies of scale. While smaller independent labs can hope to differentiate by offering “better service” and faster turnaround time, it will be an uphill battle trying to capture razor-thin margins.

Unless you’re already a fully-functioning, high-throughput independent lab with a large and diversified client base, pivoting to offer full-service testing may be a futile undertaking. You’re better off looking at alternative strategies.


2. Find new differentiators 

Traditionally, independent labs competed on these common differentiators: turnaround time,  customer service, and offering proprietary assays, methods, or lab-developed tests (LDTs). While these are still viable, labs will need to offer more to stay competitive in today’s landscape. 


Take advantage of unique distribution channels

You can differentiate by going after less conventional channels – such as functional medicine, employer/event testing, long-term post-acute care (LTPAC) support, and direct-to-consumer (DTC) products. With more people taking ownership of their own health post-pandemic, personalized “concierge” services are rapidly expanding especially among chronic care patients. This is a great opportunity to offer more specialized assays. Some popular examples include predictive cancer screening (CGx), PGx, dietary antigen testing, and hormone panels.

The DTC market, in particular, has been seeing steady growth driven by the demand for early disease detection, personalized medicine, the importance of disease monitoring, and increased consumer acceptance. The global DTC market was reportedly valued at USD $1.47 billion in 2018 and is expected to grow at a compound annual growth rate (CAGR) of 25.0% from 2019 to 2025 (Grand View Research). The DTC genetic testing market, alone, surpassed USD $3 billion in 2022 and is predicted to expand at over 11.5% CAGR from 2023-2032 (Global Market Insights). With the rising prevalence of genetic disorders and chronic diseases, this market is primed for growth.

While there’s some level of uncertainty in targeting these markets, the competition will be less fierce than in traditional channels, and there’s still room for new entrants. 


Add value by deploying tech-enabled solutions

“Labs can no longer just output results. Throwing values ‘over the wall’ to providers and expecting them to change medical management is not viable. Providers need more support in the form of holistic result interpretation and actionable guidance. The labs that provide that support will succeed.”

Many provider and patient engagement tools are tech and software-enabled, but the vast majority of labs like to play defense and wait until others have adopted a solution first before jumping in. However, the downside of being a late adopter is that many of the benefits of tech adoption are also gone. 

Don’t go after every shiny new object, though – there are many “vaporware” tools out there that promise a ton but fail to deliver. Instead, our suggestion is to craft an intentional strategy based on key focus areas that you can deploy and get meaningful results from. 

Some potentially high-value solutions include: 

  • EHR/EMR connectivity – Doctors hate to leave their EHRs, so easy test ordering and results delivery through an EHR integration can give your lab the upper hand in winning new accounts. However, EHR integrations are tricky because they can be prohibitively expensive and extremely slow to set up. It’s not uncommon for an integration project to drag on for months before ultimately being scrapped, wasting a ton of resources. Choosing a modern LIMS vendor that is built for interfaces in mind as well as the correct integrations service provider are the keys to success. 

  • Provider & patient engagement tools – Improve customer engagement through web portals or mobile apps to provide additional value to your customers. Today, customers demand easy access to their results. Having an attractive and easy-to-use portal can make a significant difference for your business. 

  • Interpretive reporting solutions – Providers and patients alike demand easy-to-digest insights about their results. PGx results interpretation, antibiotic stewardship programs, or clinical decision support solutions can greatly augment your service offerings.


3. Make sure you’re getting paid

“This is the only business that I know of where you can perform a service and simply not get paid for it.”

While innovation in the development of novel or esoteric proprietary assays is a strong differentiator, success ultimately comes down to getting paid, which is not guaranteed. To that end, it’s critical to invest time and resources to understand the ever-changing reimbursement environment. 

Compliance with Medicare’s reimbursements rules and regulations is essential to many labs. Due to a long history of fraud and abuse in the laboratory space, Medicare has become a very savvy payer with stringent mechanisms for ensuring that they do not overpay. 

Identifying the correct CPT code associated with the test is the first step. However, with novel and innovative testing, often is the case that one does not exist, which then means that there is a long road to reimbursement ahead. Applying for a new CPT code for a novel diagnostic test requires careful preparation, attention to detail, and a thorough understanding of CMS requirements and procedures. The process can take years and requires persistence. 

It’s also important to note that having a CPT code alone is not enough for reimbursement. Ordering providers must also provide appropriate, corresponding ICD-10 codes with their orders. 

In many cases, having both a CPT and a corresponding ICD-10 is still not enough to get reimbursed. More often than not, payers will deny the claim, which leads to a lengthy appeal process involving providing additional documentation to prove medical necessity. 

Before bringing in any new testing it is critical to understand the reimbursement environment around those assays. Indeed, there is an entire industry of Revenue Cycle Management (RCM) with companies dedicated to managing these processes. Their expertise can help with coding, claims denial management, and negotiations with payers to optimize returns. Having a CPT coding expert and advocate to help guide you through the process is often invaluable.


4. Don’t ignore digital marketing 

Traditionally, clinical labs have utilized outbound sales to break into a market or territory. Digital marketing had mostly been an afterthought or a “nice-to-have”. However, in 2023, things are different – digital marketing is becoming increasingly important.

This is especially true for newer modalities like genomics. According to Laboratory Economics (Oct 2022 issue), the top 14 genomic testing lab companies spent an estimated 38% of their revenue on sales and marketing expenses. This is becoming the norm as customers choose to be more self-educated by doing online research. Oftentimes, the first impression that a potential customer has with any business is not an in-person meeting, but when they search for your company on Google or LinkedIn. Even for laboratories, a lack of online presence makes it difficult to establish trust and credibility around the time your sales team contacts them. 

The key isn’t to pump out low-quality content – sometimes less is more. Start by revamping your website to establish your brand and make sure it has relevant information, like your complete service offering. It’s possible that one of your accounts could be sending orders to other labs just because they didn’t know that your lab offered that specific test. 

Even if your lab provides great service, poor online presence and weak marketing could be hindering your lab’s growth.



Independent medical labs in 2023 must be strategic and innovative in their approach to succeed in the post-COVID world. Pivoting to becoming a full-service lab or expanding molecular test menus can be effective if the volume is there, but the competition will be fierce. Labs need to consider alternative revenue streams, invest in marketing and differentiation, and also make sure the reimbursement situation is favorable. By following these tips and staying ahead of industry trends, labs can position themselves for success in 2023 and beyond.

Bratton LabWorx strives to stay on the “bleeding edge” of novel and emerging laboratory diagnostics. Bratton LabWorx consultants have a proven track record of developing strategic initiatives that align with the values of the laboratory and business. Learn more about how Bratton LabWorx can improve your laboratory’s operational efficiency.