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Friday, December 1, 2023
Dec. 1, 2023

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Legacy Health outsources laboratory services to Labcorp

Patients not expected to be impacted by change at Portland-based hospital system

By , Columbian staff writer

Legacy Health is outsourcing its laboratory business to an international laboratory service company, Labcorp.

The Portland-based hospital system operates one hospital in Clark County, Legacy Salmon Creek Medical Center, as well as several clinics. It also partners with private practice physicians in the area.

The system announced last week that it was moving forward on an agreement to sell its outreach laboratory business to North Carolina-based Labcorp. Labcorp is a publicly traded company, offering comprehensive lab services.

Labcorp also will manage Legacy’s inpatient hospital laboratories, according to last week’s announcement. Legacy will maintain ownership and licensure of the hospital laboratories, and continue to own its central lab building in Northeast Portland.

According to the initial sale announcement, Labcorp will provide staff, leadership, analytics, supply chain services and lab support for its operations here.

Legacy Health doesn’t expect the sale to impact patients in Clark County, Elizabeth Baker, a spokesperson for Legacy, said in a statement Wednesday. All of Legacy’s lab staff will be offered jobs with Labcorp, she added.

“Proceeds from the sale will allow Legacy to care for its patients, employ its workers and invest in opportunities to improve and grow,” read Legacy’s initial sale announcement.

It went on to state that providers and patients in the region will have “more convenient access to Labcorp’s full range of laboratory services.”

Financial struggles

Like most Oregon hospitals, Legacy Health has reportedly been struggling financially. The credit rating agency Moody’s Investor Services, revised its outlook on Legacy Health in April, moving it from stable to negative.

Moody’s noted concerns that the hospital system would fail to meet its debt obligations and that the company was facing challenging operating conditions in the Pacific Northwest. Specifically, the credit rating agency pointed to “high labor rates, inflated length of stay and weaker utilization recovery when compared to the rest of the country.” The agency said it expects those challenges to continue in the near term.

The Labcorp sale is expected to close in the fall.

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