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Industry Insights

How Will the Biden Vaccine Mandate Affect the Laboratory Industry?

By: Mick Raich, President, RCM Consulting, Lighthouse Lab Services / Vachette Pathology

We have all heard about the recent Biden vaccine mandate for companies with more than 100 employees. Like most government changes, this will cause some issues going forward.

In short, President Biden instructed the Department of Labor and the Occupational Safety and Health Administration to issue an Emergency Temporary Standard (ETS) mandating all employers with more than 100 employees to require they be vaccinated or face weekly testing. Similarly, any health care facility or provider accepting federal money (ie: Medicare and Medicaid) must have all staff vaccinated, with no exception for weekly testing.

This will certainly be challenged in various courts in the near future, but the overall long-term impact of this will be interesting, as well. Consider the United States Post Office, which has 640,000 employees, or the 17 million healthcare workers who in many areas of the country are already being required to show proof of vaccination. How will the lab industry meet this testing challenge if the mandate is upheld?

Jon Harol, President of Lighthouse Lab Services, recently noted the country is currently performing 10 million Covid tests per week, and the mandate stands to impact an estimated additional 100 million. If you assume roughly 45 percent of the nation is currently not fully vaccinated, that leaves up to 45 million people who will need to take a Covid test weekly. We can assume many of these individuals will choose to receive the Covid vaccine and won’t require routine testing, but we must still consider how will we handle the additional testing volume created by those who decline to be vaccinated.

There several issues here, first being the supply chain. A client of ours from a large Midwest city recently noted there are already seeing shortages of Covid test kits. Imagine how this shortage will be exacerbated if we further increase demand by 400 percent.

The next issue is capacity. Who is going to perform these tests? Many labs are running at max capacity already. Several other large hospital labs are losing staff due to their health system Covid vaccine requirements. Will recruiting become the number one job of labs going forward?

Then, we must ask who will pay for these tests? Will the company pass on the cost of the test to the non-vaccinated employee? I can pretty much guarantee insurers will not pay for these tests. Will the federal government reimburse providers via more relief funding?

Finally, we have to consider the sheer volume of labs able to perform testing. There simply are not enough labs in the country. Often, I get asked, “Is to too late to start a Covid lab?” I say it is absolutely not. This industry is still growing and there are numerous avenues for expansion. There is still time to open that lab. Covid isn’t going away anytime soon; we will be testing for variants for a long time.

In summary, Jon’s prediction that the Biden vaccine mandate could greatly disrupt the supply chain for labs rings true. I have to agree with him as I think it will be a long time before we have the capacity in all sectors of the lab industry to handle testing at the rate this new mandate will require.

Feel free to reach out to me at mraich@vachettepathology.com as I would love to hear your opinion.


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