Hospital vet opens lab
September 20, 2003
Ken Shaffer has been conducting tests on other people for more than two decades. Now he’s testing his own ability to create a new niche in the medical field.
Shaffer is the owner of The Lab at Steamboat. His one-man business venture is predicated on his belief that physicians and patients will perceive benefits to having medical lab tests done locally, rather than sending them to Denver. Typically, medical clinics rely on couriers to take samples to Denver labs operated by one of two large national companies that dominate the industry, Shaffer said.
Shaffer knows his business thoroughly, but this is the first time he’s had to market his services to customers. He worked in the lab at Yampa Valley Medical Center (formerly Routt Memorial Hospital) for a decade, and previously at Poudre Valley Medical Center in Fort Collins for another 10 years. The customer base was built-in.
When Shaffer and his boss reached the mutual conclusion a year ago that it was time for him to move on, he began preparing a business plan.
“I went to Scott Ford (at the Small Business Development Center at Colorado Mountain College) and he helped me with a business plan,” Shaffer said. “We pushed the numbers, and we did different scenarios. He uses the snuff test to find torpedoes.”
Torpedoes are the unpleasant surprises that are inevitably encountered by every entrepreneur, Shaffer said. Ignore them and they might just “go kaboom and explode your business,” he said.
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The inspiration for Shaffer’s business was the annual 9 Health Fair. Shaffer recognized from the popularity of the fair that a significant number of residents wanted to pay an economical price to have a battery of tests conducted outside of normal visits to doctors’ offices. At the same time, he was taking note of the new consumer preference study for the Yampa Valley. The report focuses on the leakage of dollars from the economy, and Shaffer realized his industry fit the profile. He concluded that if he could plug the leakage of dollars spent on medical testing, he might prosper with an independent lab.
Dr. Jim Dudley of Steamboat Medical Group said he thinks Shaffer has a reasonable idea.
“I do not view his lab any differently than I do the screening that occurs at the health fair, Health and Rec, and various other places,” Dudley said. “He will just be doing it on a more convenient basis for many people. Done right, I think it will be a very nice service to the community.”
Dudley supports the notion of people taking responsibility for and monitoring their own health but cautions people about taking their family physician out of the equation.
“My only concern is that a patient really needs to understand what the values mean, what other risk factors are there, what small changes may signify, et cetera, and not just look at the raw numbers,” Dudley said. “Too often after the health fair, people just drop their results at the office and say ‘call me if anything is wrong.’ That is not an optimal approach for their health and it is not fair to put us in the position of trying to make decisions without all the information.”
Shaffer’s lab is at 410 S. Lincoln Ave., between U.S. 40 Sinclair, Metro Brokers and RE/MAX real estate.
The Lab is equipped to take samples of blood and body fluids and conduct a gamut of diagnostic testing that ranges from checking cholesterol levels (lipids) to monitoring urinary-tract infections.
A significant portion of Shaffer’s business plan is predicated on clinics sending him business, and he acknowledges that he’s been unable to make significant inroads with physicians. Their offices are accustomed to sending samples to Denver labs by courier. Although they must wait for the results, they value the ability to key a number on the sample into their database and having the test results automatically inserted into patient records, Shaffer said. He is not yet equipped with that kind of information technology.
Another challenge is preparing his office to work with various insurance providers. At present, he works with customers on a cash basis.
The other portion of his business plan focuses on working directly with individual customers. Shaffer is optimistic that he can convince individual clients to ask specifically for his services when they visit the doctor.
Given the volatility of health insurance benefits today, Shaffer knows some people need testing that either isn’t covered by their benefits package, or is covered under increasingly large deductibles.
“Some people need test done but they have a very high deductible and they’re not even close to it,” Shaffer said. He believes he can offer a competitive advantage.
“I’m here, my prices are good, and I offer good service,” Shaffer said.
He can turnaround blood test in two hours. Although he is unable to say just how much he can save customers because he doesn’t know fee schedules for the large corporate labs, Shaffer will perform a lipids test for $25. For that price, he will issue a report that not only measures triglycerides and cholesterol, but gives clients the ratio of good cholesterol to bad.
“There are a lot of well-educated patients who know where they need to be,” Shaffer said. He hopes they will come to him for prompt service and the personal security he can offer as a small-town lab.