'Educating GPs' helped decide new lab contract

Auckland's new medical laboratory service won its lucrative contract partly on its ability to "educate" general practitioners, papers obtained under the Official Information Act show.

The papers obtained by the Weekend Herald yesterday show demand management was important to a committee, comprising officials and an independent pathologist, which recommended that Auckland's three health boards name Labtests as their preferred provider.

District health boards nationally are trying out new contracting arrangements to control costs by restraining growth in the volume of community laboratory tests - running at more than 5 per cent a year.

In July, Auckland's boards decided to dump their long-serving community contractor Diagnostic Medlab from next July, in favour of a new provider, Labtests Auckland.

The new contract is valued at more than $560 million over eight years and provides annual savings in excess of $15 million compared with the present deal.

Diagnostic is challenging its removal in the High Court and has mounted an appeal for public support. GPs have also voiced their opposition.

Reporting the committee's recommendations in May, the boards' labs project director, Bruce Gollop, said: " ... Auckland Pathology Consortium [now called Labtests] demonstrated a greater understanding and willingness to engage in measures to educate test orderers [GPs and others] on appropriate ordering, test utilisation and education efforts to control demand."

He said both bidders had recognised the need for "pop-up windows" on test orderers' computers to help manage demand for tests but the newcomer's proposal was more attractive and was included in its price, whereas Diagnostic suggested it would be extra.

The committee believed Labtests' largest problem might be recruiting staff, especially senior technologists and pathologists.

Dr Gollop noted there would be a "period of instability" until the start of the new contract.