Genetic Testing Expert Weighs In On Whether Hospitals Should Insource or Outsource Precision Medicine Tests

Strategic thinking about resources when planning genetic testing is an important consideration for hospital leaders, genetics expert says

As hospitals across the country integrate more precision medicine into their offerings, an important strategic decision that administrators face is how to allocate resources for these services.

“One of the big issues for genetic testing is insourcing versus outsourcing, and hospitals are making that calculation,” explained Bruce Quinn, MD, PhD, MBA, an experienced genetic testing expert with extensive clinical and business consulting experience.

Precision Medicine Institute recently interviewed Quinn about trends he sees in the genetic testing field. A graduate of Stanford University and Northwestern University, Quinn has taught medicine at New York University School of Medicine and Northwestern. He also has served as the Medical Director for the California region of Medicare and been in consulting since 2000. Quinn is currently the Principal at Bruce Quinn Associates, LLC, a consulting firm that has a special focus on genomics and genetic testing.

Faster Turnaround Vs. Greater Costs With Genetic Testing Strategies

Bruce Quinn, MD, PhD, MBA, Principal at Bruce Quinn Associates, LLC: consulting for hospital genomics and genetic testing services
Bruce Quinn, MD, PhD, MBA (above), currently the Principal at Bruce Quinn Associates, LLC, a consulting firm that has a special focus on genomics and genetic testing, says precision medicine is in a transition time where hospitals are strategizing their options. In-house versus sendout testing is among the first considerations. (Photo: Bruce Quinn)

When it comes to performing genetic testing in-house or outsourcing these tests, important pros and cons for each option come up. Hospital leaders need to carefully weigh the implications.

“If you do insourcing, you can potentially have faster turnaround and you can keep the expertise of the testing close to that hospital or that hospital system,” Quinn said.

On the other hand, handling these tests in-house also comes with costs. “You’re building up laboratory experts or molecular laboratory experts in the hospital that have more expertise, but you’re also taking on the costs and the profit-and-loss balance sheet for running genetic testing.”

Conversely, outsourcing testing can be less costly and simpler.

“Hospitals have to look very carefully at whether the economic advantages will work out for them of bringing things in-house versus sending things out,” Quinn said. “Sending things out is very simple; you just send a blood sample or even a saliva sample out to some outside lab, and then the outside lab either bills you or insurance for it. You don’t have all of that overhead internally.”

Hospitals may also use a combination of both options depending on the type of genetic testing being done.

“I think we’re really in a transition time where a lot of hospitals are looking at what to bring in-house and what to send out,” Quinn said as he discussed the current trends he is seeing in the field. “I’m not sure that there’s really a clear answer yet as to which will win out.”

System Size Plays a Role in Providing Genetic Testing

An important influence on hospitals’ decisions will be the size of their systems and the resources that they have available.

“One deciding factor may be the scale of the health system. For example, is it a hospital health system that can consolidate testing in one of the six hospitals?” Quinn asked. “Insourcing might be a better model for those systems, but for a small health system, it may not be economically viable.”

Another consideration for hospitals providing genetic testing is the areas of testing that they focus on.

“There’s tumor testing, where common cancers like breast cancer, lung cancer, colon cancer, and others require at least several genetic tests to be able to make decisions for the patient’s management,” Quinn explained. “That’s a national target to bring in-house. Another important area is NIPT [non-invasive prenatal testing]. That’s mostly sent out to reference labs at this point.”

Increasing Patient Awareness of Genetic Tests

As hospitals increase their strategic focus on providing the genetic testing that serves as the foundation for precision medicine, one key pitfall they may encounter is lack of awareness about precision medicine and its benefits. Quinn suggests that hospitals explore ways to increase awareness of the benefits of genetic testing for both patients and physicians.

Strategically planning genetic testing that adapts with the rapidly growing field of precision medicine is essential for healthcare leaders.

By evaluating the different options to provide genetic testing to patients and increasing awareness of the benefits that precision medicine offers, hospitals will be well positioned to stay at the forefront of precision medicine while also being able to critically consider the pros and cons of in-house versus outsourced testing.

—Caleb Williams

Related Information:

Genetic Testing Continues to Grow in Volume and Complexity

Bruce Quinn, MD, PhD, MBA

Bruce Quinn Associates, LLC

Getting Paid For Genetic Test Claims: Toolkit For Hospital Labs