“The only way to discover the limits of the possible is to go beyond them into the impossible.” — Arthur C. Clarke
The healthcare industry is constantly changing, and laboratory medicine is no exception. Traditionally, clinical laboratories have operated under a service-based model, focusing on running tests and delivering results. However, with increasing demands for better healthcare outcomes and cost avoidance, new business models are emerging. The Project Santa Fe Foundation (PSFF) is at the forefront of this transformation, promoting innovative approaches that challenge the old ways of doing things.
Clinical laboratories have long been viewed as service providers that supply test results to doctors and hospitals with high efficiency and quick turn-around times (known as Clinical Lab 1.0). While this role is essential, it has often been undervalued in terms of its impact on patient care and healthcare costs. The Project Santa Fe Foundation is working to change that by advocating for Clinical Lab 2.0, a model that expands the role of laboratories beyond traditional testing.
Clinical Lab 2.0 focuses beyond just processing lab orders. This new model identifies opportunities to provide proactive and predictive diagnostics. This means labs are not just reporting results but also helping doctors and healthcare organizations make data-driven decisions using longitudinal lab testing to improve patient outcomes. By analyzing patterns in test results, labs can identify early warning signs of diseases and help prevent serious health complications before they happen.
One of the key challenges in this shift is changing how laboratories are financially valued. The traditional payment model for laboratories is based on the number of tests performed, meaning labs are paid per test rather than for the impact they have on patient health. This can lead to unnecessary testing or a focus on volume rather than quality. The PSFF advocates for a value-based model, where labs are compensated based on how they contribute to overall patient care, cost savings, and improved health outcomes.
New Business Strategies for Laboratory Success
To support this shift, the Project Santa Fe Foundation promotes several innovative business models for laboratories:
- Risk-sharing partnerships with healthcare providers – Instead of just being paid per test, labs collaborate with healthcare systems and insurers to reduce unnecessary testing, prevent hospital readmissions, and improve disease management. If they help reduce costs and improve patient outcomes, they share in the financial benefits.
- Predictive analytics and population health management – By using large data sets, labs can identify disease trends in communities. This allows healthcare systems to intervene earlier, reducing hospital visits and long-term treatment costs.
- Integration with digital health systems – Many labs are utilizing data available in electronic health records (EHRs) and data-sharing platforms to provide insights into laboratory testing including gaps in care based on treatment guidelines and identification of high-risk patients. The goal is to provide real-time insights rather than just raw data, making lab findings more actionable for healthcare providers.
- Personalized medicine support – With advances in genetics and molecular diagnostics, labs are playing a bigger role in tailoring treatments to individual patients. This is especially important in areas like cancer treatment, where personalized therapies based on a patient’s genetic profile can improve survival rates.
By adopting these business strategies, laboratories are positioning themselves as key players in modern healthcare, rather than just providing test results.
The Challenges of Change
Transitioning to a new business model is never easy. One of the biggest hurdles is convincing healthcare systems and insurance companies to recognize the added value that labs bring. Changing payment structures requires collaboration between laboratory leaders, hospital administrators, and policymakers. Another challenge is technology investment. Many of these new models rely on big data analytics, AI-driven diagnostics, and advanced reporting tools. Not all laboratories have the resources to make these investments, and smaller labs may struggle in this new role.
However, despite these challenges, the shift toward value-based care is gaining momentum. As more healthcare systems realize the benefits of using laboratory data proactively, the role of labs in patient care is expanding.
A New Era for Laboratory Medicine
Laboratory medicine is no longer just about running tests. It is about shaping the future of healthcare through smarter, more effective, and more proactive approaches. The Project Santa Fe Foundation is playing a key role in leading this transformation, helping labs evolve from test processors to essential partners in patient care. As these innovative business models gain traction, clinical laboratories will become more than just data providers—they will be active contributors to better health outcomes and cost-effective healthcare solutions. In the end, the goal is simple: better care, better health, and a smarter way to use laboratory medicine for the benefit of all.