Why Replace Your Laboratory Information System? Things To Consider

Many clinical laboratories and pathology groups acquired their laboratory information systems (LIS systems) in earlier days of plenty, when capital budgets were cornucopias of plenty or were, at least, reasonably adequate. 

Many of these organizations still use the lab information system they acquired 10 or more years ago to their detriment. That’s because there have been many changes in the last few years, both in the laboratory operating and regulatory environments, with new regulatory constraints and an emphasis on cost containment and LIS system software capabilities.

Learn More: Transforming Patient Care: The Power of Laboratory Information Systems (LIS Systems) in Healthcare

The older laboratory information systems may not be optimum for serving the needs of the laboratory or hospital at large. Nevertheless, replacing the legacy pathology lab software with an associated large capital or operating budget expenditure often requires a lot of groundwork. 

To justify replacing the antiquated LIS medical system it will be necessary to develop and present strong operating, cost-impact, and business-related justifications.

Some substantial reasons for laboratory information system software replacement include:

• Lab information system capabilities are insufficient and provide no opportunities for test volume growth or the addition of new clients, thus limiting the lab’s revenue potential.

• The LIS lab system is expensive to operate and maintain and its pricing model no longer fits your lab's cash flow or financial situation.

• The LIS system’s integration with laboratory billing/lab revenue cycle management (lab RCM) systems and other institutional laboratory software systems is poor. 

• The lab uses pathology software and hardware that’s no longer mainstream (inconsistent with national or industry standards and incompatible with existing laboratory software systems).

• The laboratory information system doesn’t have a contemporary operating platform (not cloud-based or not user-friendly). 

• The laboratory information system vendor’s support services are poor. Problem fixing and enhancements are substantially delayed. Certain enhancements may have regulatory implications putting the institution at risk.

• The lab information system provides little or no comprehensive applications for molecular diagnostics, digital pathology, flexible reporting, direct-to-consumer lab testing, artificial intelligence, and other “leading edge” technologies, placing the lab at a competitive disadvantage.

• The LIS system software has a performance problem with significant “slow-down” issues affecting the lab’s turnaround times.

• Maintaining the LIS system requires significant “in-house” expertise and the current LIS company vendor is not sufficiently responsive to the lab’s changing needs.

• The lab information system has difficulty complying with changing federal and state regulations.

• Important security aspects of the LIS system are subject to penetration and not compliant with HIPAA requirements.

• The original LIS company is no longer in business and support for the LIS software is limited or non-existent.

• The original LIS company has replaced the lab’s current LIS model with a more modern version and will soon discontinue enhancements and support for the older LIS model.

• The lab’s medical LIS has been acquired by a larger LIS company with a competing lab information system (and the new company has failed to provide contractual assurances of continuing support).

White Paper: What To Do When Your Laboratory Information System Is Sunsetting

A Guide to Replacing Your Legacy Laboratory Information System

If any of the above replacement criteria have been met a replacement LIS laboratory information system may be appropriate.

In times of tight budgets, there is much competition for limited capital funds. To combat this, it will be necessary to prepare a well-thought-out and quantified rationale to justify why the laboratory should receive budget approval for a replacement lab pathology software. 

Very often a rigorous financial spreadsheet analysis will be required with expected financial criteria which must be met for the proposal to qualify for funding. A spreadsheet model for this analysis may be available from your financial office, the LIS system department, or the potential laboratory information system companies offering you the LIS software upgrade.

Learn More: What You Need to Know Before Contracting with a Laboratory Information System (LIS) Company

Today, various financing alternatives may remove or diminish the capital budget allocation requirement. Approaches include leasing and paying for the lab information system per transaction (based on testing types and volume and similar to the SaaS provider model). 

A transaction could be defined as requisition processing from accessioning through reporting. The number of tests processed could also be factored into the transaction volume cost formula. 

The SaaS model may be most attractive to laboratories with limited LIS lab capital budgets as there are little or no “upfront” costs and the monthly costs for lab information system services will vary with workload. Therefore, if laboratory volume decreases, the monthly cost also decreases in contrast to a capital acquisition where, after initial LIS system acquisition expenses, there will be a fixed monthly cost for service and support that will not vary even if the business declines. 

Learn More: LigoLab Informatics Platform: Uniquely Designed with Tiered Pricing to Deliver Maximum Value

When considering the best laboratory information system software replacement options for your lab they should include discussions of various payment options with the prospective LIS software vendors and your institutional CFO.

Granted that, except in unusual and critically apparent circumstances, it will be necessary for the laboratory to do the required analysis and “number crunching” to help justify its case for a replacement laboratory information system. 

To the extent that rigorous and definitive analysis and cost-benefits projections are made, the laboratory’s chances of obtaining the necessary approvals and budget allocation shall be enhanced.

Learn More: Best Pathology Lab Reporting Software - 2025 Buyers Guide and Checklist

Upgrade to LigoLab’s Advanced LIS Software and Future-Proof Your Lab Business

Don’t let an outdated lab information system hold your lab business back. 

LigoLab’s all-in-one medical LIS and lab billing informatics platform is designed to empower clinical, molecular, and anatomic pathology labs with cutting-edge informatics tools that drive efficiency, accuracy, and financial growth.

Ready to make the switch? 

Contact LigoLab today to explore how our all-in-one platform can revolutionize your lab technical and financial operations.

Contact a LigoLab Product Specialist!

Article References: 

Winsten, Dennis, “Why Spend the Money? Justification of Laboratory Information Systems”, Clinics and Laboratory Medicine, R. Aller & F. Elevitch, Editors, W.B. Saunders Company, March 1991.

Weiner, H and Winsten, D., Chapter 6, Pathology Informatics-Theory and Practice, Editors: Pantanowitz, L, Tuthill, JM, Balis, U. American Society for Clinical Pathology press, 2012.

Mr. Winsten is president of Dennis Winsten & Associates., an independent healthcare information systems consulting firm headquartered in Tucson, Arizona. He has over 40 years of computer experience including over 30 years in healthcare systems.  www.dwinsten.com