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Quest Diagnostics Acquires Outreach Operations of Memorial Hermann Health System

NEW YORK – Quest Diagnostics said on Monday that it has acquired substantially all the operations of Houston, Texas-area Memorial Hermann Health System's outreach laboratory division.

The acquisition includes almost 30 patient service centers and nearly 60 in-office lab service sites, which will move their testing the Quest's lab in Houston.

Additionally, the deal includes a multi-year arrangement under which Quest will provide management services for all of Memorial Hermann's 21 hospital labs, which the hospital will continue to wholly own.

Quest will also become the sole preferred provider of lab services for the Memorial Hermann Health Plan.

The transaction is expected to close in Q2 2020. Financial and other terms were not disclosed.

"Memorial Hermann's partnership with Quest marks one of many strategic steps we are taking to make value-based care and expanded access to important health services a reality for Houston communities," Memorial Hermann President and CEO David Callender said in a statement. "As part of Memorial Hermann's commitment to lower the cost of care, the system intends to utilize Quest's expertise and scale to improve cost-efficiencies while maintaining the high-quality services and comprehensive resources needed to make Houston healthier, now and for generations to come."

"Memorial Hermann is a marquee health system nationally recognized for safe, high-quality care. Their decision to choose Quest underscores our unique ability to optimize lab strategies for health systems, with capabilities ranging from lab management and reference testing to acquisition," said Steve Rusckowski, Quest's chairman, president, and CEO. "This relationship will also strengthen our laboratory and service network in Greater Houston, which in turn will empower more patients and providers in the area to access quality, cost-effective service at the Quest Diagnostics location most convenient for them."