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Lab Test Volumes Plummet as Patients Put Off Care Due to COVID-19

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NEW YORK – As the COVID-19 pandemic continues to stress healthcare systems across the US and world, clinical labs and diagnostic firms have raced to ramp up SARS-CoV-2 test volumes.

But while demand for SARS-CoV-2 has soared, volume for non-COVID-19 testing has plummeted as patients are putting off elective procedures and routine doctor's visits.

This week, Quest Diagnostics filed a form 8-K in which it noted that during the last two weeks of March the company's test volumes, inclusive of COVID-19 tests, declined by more than 40 percent.

"Federal, state and local governmental policies and initiatives designed to reduce the transmission of COVID-19 have resulted in, among other things, a significant reduction in physician office visits, the cancelation of elective medical procedures, customers closing or severely curtailing their operations (voluntarily or in response to government orders), and the adoption of work-from-home or shelter-in-place policies, all of which have had, and we believe will continue to have, an impact on the Company’s operating results, cash flows and financial condition," the company said in the filing.

In an investor note, Barclay's analyst Jack Meehan wrote that the Quest numbers track with a model the bank developed that predicted a roughly 35 percent drop in lab test volumes due to the pandemic. The model was based on a survey of 50 OB/GYNs that found these doctors expected to see a 40 percent to 60 percent decline in office visits during the outbreak.

Smaller regional and community laboratories are facing similar challenges, with the National Independent Laboratory Association (NILA) noting in a statement issued last week that "the volume of routine laboratory testing has declined dramatically due to the closure of many physicians’ offices, medical clinics, surgicare centers, and other healthcare facilities."

The association added that the drop in test volumes "is forcing many regional [and] community laboratories to reduce their workforce."

Mick Raich, CEO of consulting firm Vachette Pathology, said his clients have seen a dramatic drop in test volume since the onset of the COVID-19 outbreak in the US.

"You can't do elective surgeries, so pathology work is down like 50 percent," he said. Lab testing has held up somewhat better, but here, too, volumes are suffering, he said, adding that he thought the 40 percent drop in test volumes cited by Quest seemed realistic.

"If you're not really sick, you aren't going to the doctor's office," he said. "No one is getting a physical right now. So you aren't doing routine lab testing."

NILA Administrator Mark Birenbaum said that his organization had received reports from member labs of drops in testing volume ranging from 40 percent to 90 percent. Certain specialty labs, like those serving the in vitro fertilization space have shut down completely, he said.

Birenbaum said he began hearing about drops in test volumes around three weeks ago and that it has since become a widespread phenomenon.

Layoffs and furloughs of lab employees have also begun, Birenbaum said. He said the he did not have hard numbers for layoffs in the lab space, but gave the example of one large member lab that laid off or furloughed around 15 percent of their workforce last week.

Kyle Fetter, executive vice president and general manager of diagnostic services at revenue cycle management and lab informatics firm Xifin,, said that thus far, most industry layoffs and furloughs were occurring on the administrative side of the business as labs tried to maintain their clinical staff.

Fetter said his firm has seen volumes drop substantially not only for routine lab testing but also for tests that might not typically be considered elective, such as genetic tumor testing to determine patient cancer therapy, which he said had dropped around 30 percent to 35 percent since the start of the outbreak in the US.

"We would not expect those [testing] behaviors to change drastically, but they are a little bit in the short term," he said.

Fetter said Xifin has also seen a large drop in hereditary cancer testing, though he noted this was less surprising given that this testing is generally less urgent than testing for somatic mutations to guide cancer treatment.

Another area that has seen a major decline is toxicology and pain medication testing, where test volumes have dropped more than 50 percent, Fetter said.

"Patients are still on these [pain] medications, so it is probably not a great thing that they are not monitoring it as much through pain and toxicology testing," he said. "But it's a very clear trend that that testing is way down. What people are calling elective procedures right now is a much broader spectrum than what it might have been in the past."

One area that has seen less of a drop-off than most is non-invasive prenatal testing, Fetter said, though he noted that even here volumes are down around 20 percent.

Raich said that some labs are trying to move into SARS-CoV-2 testing to help address the broader shortfall but noted that "you can't make up that [lost] volume with just COVID-19 testing."

Additionally, it can be difficult for labs to get ahold of the instrumentation and supplies they need to start SARS-CoV-2 testing, he said.

"It's hard to get the kits," he said. "And rightfully so. They are keeping the kits for in-patients who have COVID-type symptoms. You shouldn't just be testing anybody who wants to be tested."

Birenbaum similarly said that many NILA member labs were exploring SARS-CoV-2 testing but that they were running into a number of challenges.

"We have different size laboratories with different capabilities," he said. "If they are decent sized and have some of the [RT-PCR] equipment in-house already, the challenge has been, do they have equipment that is compatible with the [Centers for Disease Control and Prevention] assay" the first test for SARS-CoV-2 to receive Emergency Use Authorization from the US Food and Drug Administration

More recently, he noted, several vendors have received FDA Emergency Use Approval for tests on their platforms. For labs with these platforms, a major challenge has been getting test kits, with some labs being told by vendors that they won't be able to get shipments of kits for two months. Obtaining swabs for collecting patient samples has also been a challenge for some labs, Birenbaum said.

Labs without RT-PCR instrumentation already in place face the question of whether the capital investment required to purchase the instrument is worth it, particularly given the supply chain issues.

"Labs are saying, well, we would [start SARS-CoV-2 testing], but we don't have the necessary capital and we're not willing to take loans out if we don't know whether we can get kits," Birenbaum said. "If we have the equipment but we can't do the testing because we can't get the supplies, then we're just losing money."

There are also questions about whether making capital investments makes sense given the relatively low reimbursement for the test. Pricing put out by local Medicare Administrative Contractors last month put reimbursement for the CDC test at around $36 and reimbursement for non-CDC versions at around $51.

According to some NILA member labs, "if you factor in all the capital investment and everything, the [Medicare rates] don't cover their costs," Birenbaum said.

Fetter agreed. "At the price [CMS] is going to pay for COVID-19 testing, if a lab is super efficient, they will potentially break even," he said.