Quest Diagnostics to Acquire Mercy Outreach Lab Services Business

The acquisition is a step to "broaden access to innovative convenient lab services" in the Midwest and is slated to be completed in the second quarter of this year.

Quest Diagnostics and Mercy have signed a definitive agreement for the New Jersey-based diagnostics company to acquire the St. Louis-based health system's outreach laboratory business through an all-cash asset transaction, the organizations announced Monday.

Pending regulatory approvals, the acquisition is slated to be completed in the second quarter of this year.

Through the transaction, physicians and patients across the Midwest will have access to Quest locations, health plan coverage, and competitive pricing. The company stated that the deal is a step to "broaden access to innovative convenient lab services” in the Midwest.

“As one of the country’s leading large health systems, Mercy is exiting the physician lab outreach business to sharpen its focus on providing high-quality, equitable care,” Steve Rusckowski, CEO of Quest, said in the press release. “We look forward to working closely with Mercy to support their lab strategy. As pressures from the pandemic ease, and customer expectations and reimbursement pressures rise, we are talking to more and more top health systems about how Quest can help them enhance the effectiveness of their lab strategies.”

The Mercy outreach laboratory business serves providers and patients in Arkansas, Kansas, Missouri, and Oklahoma through 29 hospital labs and two clinic labs. If the acquisition goes through, testing will transition to a full-service Quest lab in Lenexa, Kansas, as well as to a network of "rapid responds laboratories across the region."

According to the press release, Mercy will continue to “wholly own and operate its hospital labs for tests connected to inpatient and hospital-based outpatient care needs."

“Mercy chose Quest to provide outreach lab testing because of its record of innovation and efficiency and our shared commitment to providing high-quality, convenient care that is accessible to all,” Lynn Britton, CEO of Mercy, said in the press release. “This relationship gives our patients and providers more convenient locations for sample collection and a significantly lower cost of testing while maintaining the same high-quality patients and providers need.”