3 Tips for Opening an Independent Physician Office Lab

For many practices, starting a physician office laboratory (POL) improves patient care. In-house diagnostics lead to faster test results, quicker clinical decisions, and higher patient satisfaction. Yet, setting up a POL requires careful planning, regulatory compliance, and ongoing oversight.

Thinking about opening a physician office lab? Here are key steps and considerations for launching a successful POL.

What Are Physician Office Lab Requirements?

Before you write your business plan or buy equipment, understand the regulations for lab testing in the US. The Clinical Laboratory Improvement Amendments (CLIA) oversee all lab testing on humans. Depending on the complexity of your tests, your lab will need the right CLIA certificate.

Understanding CLIA Requirements

The Centers for Medicare and Medicaid Services (CMS) is the primary enforcer of CLIA regulations. If you apply for a certification, CMS or a state agency will issue it for your physician office lab. CMS also conducts inspection and enforces penalties and corrective actions for non-compliance.

The Food and Drug Administration (FDA), on the other hand, checks and approves test kits, especially for point-of-care use. When looking for manufacturers, ensure that they are FDA approved. FDA approval is a CLIA requirement.

Before you create your lab protocols, check laboratory best practices from the Centers for Disease Control and Prevention (CDC) standards. The CDC develops guidelines for quality control, personnel training, and proficiency testing for your lab.

Creating detailed policies that meet CLIA standards is essential. These guidelines inform daily operations and ensure consistency. Consultants can help with documentation to prepare your protocols for review.

With your CLIA certification secured and procedures in place, you can begin addressing the next essential components of your physician office lab. These include:

• Evaluating and preparing the physical space
• Ensuring staff training
• Selecting appropriate testing equipment
• Implementing integrated EHR and billing systems to support efficient operations.

Tip #1: Evaluate Physical Space

One of the first and often overlooked challenges is finding adequate space for your lab. Many practices convert small rooms or storage areas, only to outgrow them quickly.

Some physician office labs start in supply closets but soon need more space. Eventually, they move to larger exam rooms and ultimately require further expansion.

Consider your current needs and future growth when assessing your layout. You’ll need room for analyzers, refrigerators, workstations, storage, and a phlebotomy area.

Tip #2: Conduct Training and Staff Qualifications

CLIA compliance also means your lab personnel must be trained and qualified. This process includes not only teaching technical skills but also outlining clear policies that any prepared team members can follow.

Well-written procedures act like a roadmap for new employees. They set them up for success from day one. And for seasoned team members? They, too, can benefit from easily accessible, reliable documentation.

The CDC develops and distributes professional training and educational resources. CLIA regulations, guidance, and forms

Bringing in the Right Expertise

Opening a lab within your practice is like starting a business. It’s helpful to have an experienced person guiding the process—ideally, the future lab manager.

Having someone involved from the start who understands lab operations is crucial. Medical supply distributors like Medline, McKesson, or Henry Schein can also be valuable resources during planning.

Moreover, hiring for a physician office lab presents its own challenges. Smaller practices may struggle to match salaries offered by hospitals or large labs. To compensate, small practices can offer regular daytime hours and no weekend shifts. Flexibility, professional development, and a supportive environment can help attract the right talent without overextending your resources.

When recruiting, look for candidates who can handle various tasks. Graduates from medical laboratory technician (MLT) programs or trained phlebotomists fit well in small labs. Why? Principally, they are highly skilled at multitasking, which is crucial in these settings that require meticulous attention to a series of specific steps.

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Tip #3: Select the Right Equipment and Software

A functioning lab needs more than analyzers. You’ll need durable counters, refrigeration, storage for supplies, and running water. Costs can add up quickly, so consider leasing options if your budget is tight.

Your lab will also need a laboratory information system (LIS) that fits your workflow. The LIS should work with your EHR and billing software. Your EHR is where you are going to order tests, receive results, and chart them. Without a suitable EHR, you’ll be left with using paper requests, which allow for human errors and slowdowns.

A physician office lab billing software cuts down on repetitive data entry, too. It lets testing information flow smoothly from the lab to a clearinghouse. Medical providers could save $124 million each year by using electronic claim submissions. When starting your physician office lab, focus intently on cutting losses from claim rejections. This way you can build a strong financial foundation for your new testing facility, supporting sustainable revenue and growth.

The best way to make sure revenue doesn’t slip through the cracks? Harness the power of automation to minimize errors with an EHR that has both an LIS and integrated billing.

Choosing Your Testing Menu

Connecting the equipment in which you invest is what exact testing you choose to offer. Whatever analyses you provide should first and foremost meet the needs of your patients. For example, a family medicine practice might focus on common point-of-care tests, while a cardiology practice may include advanced panels for heart health.

Start with what makes sense for your practice. Begin with manual test kits and add automated testing as you grow.

Balancing investment with need is key. Expanding too quickly can lead to unused equipment and unnecessary costs.

Focusing on Patient Outcomes

The main goal of opening a POL is to improve patient care. Running tests during the patient visit enhances decision-making and convenience. Patients can get results and start treatment on the same day, meaning earlier interventions, potentially better outcomes, and greater satisfaction.

One cannot overstate the value of immediate results. They foster meaningful conversations between the physician and patient, leading to better adherence to treatment.

Opening a POL is a significant step that requires commitment and planning. From regulatory compliance and equipment selection to staffing and workflow design, each decision impacts the physician office lab’s success.

If you’re considering opening your own testing facility, gather the right resources and consult with professionals who can guide you. With careful planning, your practice can install diagnostic services that improve your care model while boosting your bottom line.