Dive Brief:
- Testing firm Labcorp bought RWJBarnabas Health’s outreach laboratory business and select related assets for an undisclosed price, the two companies said in a press release.
- The acquisition expands access for RWJBH patients to Labcorp testing sites across the state, including those at Walgreens pharmacies.
- RWJBH said the sale will allow the hospital group to “streamline” operations and offer wider variety of tests to its patients.
Dive Insight:
As hospitals seek to outsource back-end functions, they have been handing over laboratory services to diagnostics giants such as Labcorp, which can streamline testing services and use its larger size to reduce costs. Hospitals hope to gain better analytics from specialized providers.
The purchase by North Carolina-based Labcorp will apply to all of RWJBarnabas’ facilities, including its 12 acute care hospitals that are spread across eight counties in New Jersey.
The acquisition also will offer patients and the hospital system “seamless data integration and connectivity” to testing results, Bill Haas, senior vice president of Labcorp’s Diagnostics’s Northeast Division, said in a press release.
The price of the acquisition wasn’t disclosed.
Labcorp has strategic relationships with a number of health systems, including Catholic non-profit health system Ascension, Seattle-area chain Swedish Health Services and Alabama-based Infirmary Health.
Labcorp also has a contract research arm, which in the past has allowed hospitals greater access to drug trials for their patients.
While COVID-19 testing has driven a huge surge in testing demand, benefiting lab companies like Labcorp and Quest Diagnostics, the more recent decline in coronavirus testing has pushed them to ensure a more consistent revenue stream, often by acquiring hospital lab services and the access to their customer base.
