How fascinating was it to follow the Theranos story?  To see a company fall from a $10 billion valuation to insolvency in a matter of weeks is something I thought I’d see in cryptocurrencies like Bitcoin, but it is certainly not the norm in the clinical laboratory industry. When I look back to the earliest days of Theranos, I can still see understand why so many very savvy investors jumped on board the Theranos train – because the truth is that Theranos was absolutely correct about one thing: it makes no sense for all lab testing to be done at the big, centralized lab facilities. Instead, accessibility, quality and cost should be the key drivers.  How does sending specimens across the country to expensive labs billing out of network address any of these issues? Short answer: it doesn’t. That’s why more and more hospital system, ACOs, addiction treatment facilities and physician groups are bringing ancillary lab services in-house.  It really comes down to three things:

With an on-site lab, you can say goodbye to patient mix ups, lost samples, “QNS” or leaked specimens in transit.  Not to mention that having control of maintenance and quality checks improves patient care and the accuracy of results.  

Having full control of turn-around time and never again having to call into an automated system to get an ETA (or another excuse!) on your patient results.  As a general rule, health care providers tend to be smart, focused, and work on time-sensitive issues.  Running your own samples means no more having to wait in line to get results.  

High priced third-party labs with huge sales and marketing budgets are inflating costs for the entire system. 

Every reputable analyst in the country will tell you that the health system is trending towards value based reimbursement, and if you read anything about UHC’s latest deal with one of the big labs, you’ll see that the process is well underway in the clinical laboratory space.  In the near future, providers are going to be saddled with the expectation of bundled payments for treating different disease states.  With laboratory medicine playing a key role in virtual any diagnosis or treatment plan, it’s fair to expect more integrated care systems with end-to-end capabilities to play an increasingly prominent role in the future of our health care system. 

But the good news is that you don’t need a “micro-lab” from Theranos to bring an affordable, accessible, high-quality laboratory into a practice.  The economics of an in-house lab work great for most practices and often provide substantial ancillary revenue opportunities while simultaneously setting the practices up for long-term financial success. Stop letting the big reference labs eat your lunch.  Let us help you build your own in-house lab and recapture that revenue that the big companies have been taking off your hands.

Want to learn more?  Fill out this form and I’ll personally reach out to schedule a call with you in the next 24 hours.

If 2008 to 2013 was the Golden Age of the reference lab industry, 2018 is at least the Bronze Age. With toxicology confirmations generating reimbursements as high as $250 per sample and all-in costs at less than $50 per sample, it’s no surprise that I often get approached by people looking to start their own reference lab.  They’re ambitious, they see a great opportunity, and they can’t wait to get involved in the industry.  But they want to do it the right way and need someone who knows the tricks of the trade, which is why they call me (for those of you who don’t know me, before I founded Elite, I was the President and COO of a reference lab generating $150 million a year in revenue). 

After transitioning to become one of the top laboratory consultants in the country, I quickly became known for my willingness to speak honestly and openly with my clients rather than just tell them what they want to hear. And with that in mind, I am here to tell you that these days, success in reference laboratory business takes sophisticated planning and disciplined execution.  So for those just starting out, here are four of the most common business mistakes I’ve seen in my years in the industry – and four solutions that can work for you and your team.

MISTAKE #1: Forgetting about payor contracts and chasing every sample in America

Solution #1: Pick a distinct geographic area and stick to it until you’re the dominant player in the market

There are samples everywhere and of course you want them all.  But keep in mind that samples are worthless without the payer contracts.  Actually, they’re worse than worthless because you’ll spend money finding them, running them, and reporting them with no realistic expectation of revenue.

And, getting payor contracts in 2018 is a lot more challenging than it was in 2008.  Most networks are closed, so getting in-network contracts takes persistence, focus, and time.  Focusing on dozens of contracts simultaneously in many diverse states with different political environments is tricky. 

Narrow your focus and execute on the contracts you truly want and need.  Payor contracting needs to be an early focus of every owner of the business. If your co-owners don’t understand this, find new co-owners.

MISTAKE #2: “Saving Money” By Hiring the Cheapest Billing Company Out There

SOLUTION #2: Hire a competent billing company with lab experience that understands the denial and appeals process

Getting third party payors to pay consistently takes a refined approach.  Reference labs need to be experts in billing.  You’d be surprised how many companies change billing companies multiple times in their first 2 years (my first lab was one of them…). 

Partnering with an experienced billing team that knows the landscape and understands the denial/appeals process can be the difference between debt and dollar signs.  Good billing companies stand by their results.  Their compensation is typically paid on a contingent basis because reputable billing companies must deliver the goods.

Keep in mind, even the worst billing company should be able to collect the easy money, so what you want is someone who knows how to properly work through challenging claims.  A good billing company will cover their 5 or 6% fee many times over.  And once you feel confident you understand the process, utilization, and medical necessity requirements, you can start demoing the billing software packages out there and consider bringing it all in-house.    

MISTAKE #3: Waiting Until “Go-Live” to Ramp Up the Sales Effort.

Solution #3: Spend the 90 days leading up to “Go-Live” pre-selling your services and honing your sales operation.

The lab business is a volume business.  The first few hundred paid samples cover your overhead. It’s the additional paid samples where your profit begins to build.  Start early and lay the groundwork for as many early bedrock customers as possible.  Open many sales channels early on until you see what is going to ultimately generate consistent business.


MISTAKE #4: Burning Through Cash

Solution #4: Keep Expenses Low-Low-Low from the Start

Unless you made a killing in Bitcoin and can’t wait to find ways to spend it, keep your operations lean and your expenses as low as possible while payor contracting and sales generation efforts are in process. 

These days, the runway can be long, and the last thing you want is to face an early liquidity crunch. The first time you have to tell a sales rep that their paycheck is going to be (i) smaller than it should be, or (ii) delayed for a week or two is the last time you’ll have that sales rep’s full loyalty and motivation. 

That’s why cash flow management and running lean is something we at Elite focus on during all of our engagements.  Building efficient programs early on will be key to success.  Every dollar saved is an extra dollar that can be put towards growing your business. 

Stay focused. Stay lean. Stay credible. Do these three things, and you’re well on your way to successfully avoiding the business mistakes that your competitors are out there making as we speak.

Want to learn more?  Fill out this form and I’ll personally reach out to schedule a call with you in the next 24 hours.

Hi and welcome to the new and improved Elite Diagnostics website and blog.

At Elite Diagnostics, our mission is to empower physicians and improve patient care by building and managing CLIA-certified, physician-owned clinical and toxicology laboratories.

By building in-house labs for existing practices, Elite allows physicians to recapture significant lab revenue that is currently being lost to outside reference labs.

Our young, dynamic team has more than thirty years of experience running one of the nation’s largest toxicology reference labs. We are proud to be unique in that we provides true end-to-end laboratory set-up, management, and solutions.

And for outside reference labs, our expertise can be invaluable – we’re experts in CLIA and COLA compliance programs (including mock inspections), LCMS method development, SOP and workflow optimization, standard production, and personnel sourcing and training.

I hope you find our new site informative – and that you’ll reach out to set up an introductory phone call via the Contact Us link or by emailing Elliot Labovitz, our Director of Business Development, at

We’d love to learn more about your practice and let you know about everything that our company has to offer. Thanks again for visiting our site and we hope you’ll reach out to set up a call.



Mark Roth

Chief Executive Officer, Elite Diagnostics


Elite Contact Form

"*" indicates required fields


"These guys know tox. I spend about 40% less than I used to before I started running their method on my two LCMS instruments. When there’s a problem, I usually don’t even hear about it until after Elite has already fixed it.  I love that."

- Cody E., Reference Laboratory, Charleston, West Virginia