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VOL. 127 | NO. 227 | Tuesday, November 20, 2012

Smalley Leads American Esoteric Laboratories During Growth Initiative

By MICHAEL WADDELL

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American Esoteric Laboratories, the largest independent provider of esoteric and clinical laboratory services in the region, is poised for strategic growth as Dr. David L. Smalley takes the helm as the new president at its Memphis headquarters.

SMALLEY

AEL is a comprehensive laboratory offering the full gamut of services, including hematology, chemistry, immunology, microbiology, molecular biology, cytology, urinalysis and parasitology.

“We are positioned very well to have substantial growth over the next few years,” Smalley said. “And when the Affordable Care Act goes into place, there will be even more need for us to provide services.”

More than 30 million new patients are expected to enter the health care system once the Affordable Care Act fully takes effect.

Most recently, Smalley served as the state public health laboratory director for the Tennessee Department of Health since 2006. Prior to that, he worked at AEL as the medical director.

In October, Smalley completed a 30-year career in the U.S. Army Reserves that included a stint as the assistant surgeon general, and he retired as a brigadier general. In 2010, he was awarded the Lucien Dean Hertert Award, the highest award given by the American Association of Bioanalysts for lifetime achievement in the field of Clinical Laboratory Sciences.

AEL has operated locally for more than 50 years, and its Mid-South division now covers Missouri, Arkansas, Kentucky, Alabama, Mississippi and Tennessee.

“We cover a six-state area, and there are new opportunities for us to do partnerships and align with various hospitals within those six states,” Smalley said. “In addition, we are pursuing a variety of strategic plans with insurance carriers to partner with them to improve efficiencies, and we are expanding our capabilities from an electronic reporting standpoint to optimize the reports going back to 2,100 doctors’ offices here in Tennessee.”

The concept of labs aligning with hospitals is a fairly new concept, according to Smalley, because hospitals are being required to be more efficient with their ancillary services like laboratory testing.

“We can help them from a quality improvement standpoint in being able to monitor and target specific chronic diseases, so the benefit is for the patients, the doctors and the insurance carriers,” said Smalley, who pointed out that as much as 80 percent of the diagnosis and treatment for patients is impacted by laboratory testing.

AEL already has a couple of partnerships with insurance carriers in place, including one to be the exclusive provider of services for Health Springs in West Tennessee, and the company is currently pursuing discussions with other insurance carriers.

In addition to its labs, AEL operates 26 patient service centers across Tennessee and will be opening the 27th in Murfreesboro next month.

In Memphis, AEL moved into its newly built 70,000-square-foot, $14.5 million headquarters in December 2010. Now, more than 30,000 tests are conducted at the lab each day.

“We have plenty of expansion room for the future,” said Smalley, who explained that the lab expects to spend approximately $500,000 on equipment upgrades and new technology this year. “We’re continually looking at new methodologies and new technologies that can improve either the diagnostic or therapeutic information for doctors in taking care of patients.”

New areas of testing that have evolved recently are in the areas of molecular diagnostics and more extensive testing in toxicology, as well as the newest technology in cytology. One example is with liquid-based pap smears, which are much more sensitive than previous testing methods.

“The ability now to detect cervical cancer or other abnormalities is certainly enhanced by our new technology,” Smalley said.

The company is also in the process of upgrading its electronic capabilities as more hospitals and physicians offices are facing mandates to convert to electronic records systems.

“Today we are able to send everything out electronically so that once lab results are out on a real-time basis they are already into the patient’s medical records,” Smalley said.

AEL was acquired by Sonic Healthcare in 2007 and now makes up the Mid-South division of Sonic. The company operates its own logistics ports or hubs in cities like Little Rock, Ark., to transport samples to its labs.

AEL employs a staff of 677 in Tennessee in locations in Memphis, Nashville and Knoxville, and more than 800 throughout its six-state Mid-South division, including at labs in Gulfport, Miss., and northern Alabama.

Elsewhere in the region, AEL recently increased its presence in Knoxville by merging two smaller laboratories and expanded its Alabama operations in February by acquiring Bridger Pathology Labs in Montgomery.

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