Expert: Quantify Inaction to Displace Incumbents
"The fastest way to displace an incumbent is to quantify the cost of inaction—show them what it’s costing to stay put, not just what they gain by switching," advises growth strategist Scott Finkelstein. He recommends using "pain discovery workshops" and case-based urgency to make the cost of waiting tangible for buyers.
Sticking with a legacy lab information system (LIS) creates an artificial ceiling for growth, transforming a once-sufficient platform into a significant liability over time. These outdated systems often result in tangled, disconnected workflows, leading to costly maintenance, data inconsistencies, and bottlenecks that directly impact turnaround times and client satisfaction. The financial drain of inaction is substantial, with clinical labs losing 20-40% of total billable revenue to systemic billing inefficiencies like miscoding and outdated RCM workflows. An estimated $10–$12 billion in lab claims go unpaid annually, and a staggering 55-65% of denied claims are never reworked, representing a permanent loss of revenue. The operational cost of a single denied claim ranges from $25 to $118 in administrative work to correct and resubmit. These denials stem from preventable issues like inaccurate patient data and eligibility problems—vulnerabilities common in older, less automated systems. In pathology labs, workflow inefficiencies tied to manual processes and outdated systems quietly drain resources. Industry studies estimate that human errors can cost $60 to $80 per incident, a figure that multiplies quickly across thousands of specimens, delaying diagnoses and impacting patient care. Delayed lab results have a direct clinical and financial impact. For critical conditions like sepsis, the risk of mortality increases by 7.6% for every hour treatment is delayed. Furthermore, inefficient lab workflows are linked to longer hospital stays, with one study showing a 30% reduction in lab turnaround time cut the average length of stay by 0.6 days. Point-of-care testing (POCT) offers a clear value proposition by delivering faster results where the patient is treated. One hospital that implemented handheld POCT for sepsis care saw patient mortality rates drop by nearly 50% in the first six months, demonstrating a powerful return that far outweighed the initial investment. Modernizing lab billing and RCM systems yields a significant and rapid return. One diagnostic lab, after implementing an automated RCM module, saw monthly collections increase by 20-30% without any change in test volume. Their billing cycle improved from a multi-week process to just a few hours.
