Health care reform efforts, largely under the aegis of managed health
care initiatives, have prompted clinical laboratories to increase effi
ciency and reduce both expenditures and test turnaround times. The ado
ption of newer technologies is viewed as a mechanism of achieving the
latter objectives, but direct and indirect costs and outcomes are ofte
n difficult to project. Issues explored in this article include the im
pact on a large university hospital-based clinical microbiology labora
tory following the application of various technological approaches to
organism recognition and susceptibility testing and the consolidation
of certain testing services. Included are applications of an automated
blood culture system; radiometric detection, identification, and susc
eptibility testing of mycobacteria; and the use of molecular probes to
identify various microorganisms. Assessment was made through retrospe
ctive review of direct costs, estimates of average test report turnaro
und times, work flow changes, and real or perceived outcomes. Both the
application of technology per se and consolidation of an independent
virology service into the general microbiology laboratory enabled impr
ovement in test report times and led to direct or indirect cost reduct
ion. Managerial strategies to bring about organization changes through
out all clinical laboratories in response to a major hospital-wide cos
t reduction program are also presented together with financial outcome
s achieved.