Consolidation of pathology services in England: have savings been achieved?

Abstract

Background: During the last decade, pathology services in England have undergone profound changes with an extensive consolidation of laboratories. This has been driven by some national reviews forecasting a national reduction of costs by £250-£500 million ($315-$630 million) a year as a result. The main aim of this paper is to describe the financial impact of such consolidation, with a specific focus on the forecasted savings. A secondary aim is to describe the development of private sector involvement in laboratory services in a traditionally publicly funded healthcare system and the development of pathology staff size.

Methods: In the English scenario, the majority of hospitals and laboratories are publicly funded and a survey was sent as Freedom of Information request to all directors of pathology. A descriptive comparison of savings among consolidated and non-consolidated pathology services was made by using the pathology budgets in two different periods (2015 versus 2010), adjusted by inflation and increased activity.

Results: The hub-and-spoke model has been implemented as part of the consolidation process of pathology services in England. Consolidated pathology networks have achieved higher savings compared to non-consolidated single laboratories. There has been an increased role of private providers and savings were achieved with negligible personnel redundancies.

Conclusions: Consolidated units have on average achieved larger cost savings than non-consolidated units but further analysis with stronger research design is required to independently evaluate the impact of pathology consolidation on both savings and quality.

Keywords: Consolidation of pathology services; England; Savings.

Fig. 1

Centralization of laboratories in England. The majority of laboratory in England are already consolidated (n = 89 out of a total of 153). Around half of the remaining non-consolidated laboratories (n = 27) are planning a consolidation in the near future

Fig. 2

Consolidated versus non-consolidated laboratories. Graphical comparison of savings and deficits in consolidated (n = 56) versus non-consolidated (n = 57) laboratories. Each dot represents a laboratory (hub or single). Not all laboratories have achieved savings and this explains the negative values above (values under the red line). The two black lines indicate the mean or average savings per laboratory

Fig. 3

Role of Private providers. Data provided for 2015 show an increased role of private providers (bottom line), now equivalent to 13% of the total pathology budget

Fig. 4

Impact of consolidation of laboratory services on pathology staff. In the last 5 years, there has been a minimal number of redundancies (0.7%) but 25.8% of staff have been TUPE transferred to a new organization