When starting an urgent care business, big-ticket items like location, staffing, and marketing rightfully deserve much of your attention. However, one quiet area often underpins both clinical success and financial health: lab testing.
It isn’t just nice to have. Lab testing is a foundational component of urgent care operations. Patients count on your clinic’s ability to quickly diagnose their symptoms and offer the right treatment, and sending away simple labs can grind the process to a halt. With a well-designed strategy, lab testing contributes not just to patient satisfaction, but also to your bottom line.
Understanding what tests to offer, how to structure lab workflows, and how to align your services to maximize reimbursement can make or break your new urgent care’s efficiency and profitability.
Why Urgent Care Labs Matter
Lab testing is deeply integrated into the urgent care business model. Industry data shows that 42% of urgent care visits involve lab work, and of those, 85% are performed on-site. On average, a visit involving lab work includes 2.1 tests per patient.
The ability to run a strep, flu, COVID, or pregnancy test in minutes, not days, means providers can diagnose and treat on the spot. Urgent care thrives on fast answers, and on-site lab capabilities position your clinic to meet patient expectations for a one-stop solution to their symptoms.
However, the specific tests and volume of labs your clinic should have available may not be the same as the clinic down the street. Misalignment leads to waste and missed revenue opportunities. Your patient population and the scope of non-lab services you offer play a big role in building an effective strategy.
For instance:
- Clinics that see a high volume of respiratory illness will naturally perform more rapid strep, influenza, RSV, and COVID tests, especially during fall and winter surges.
- Clinics offering occupational medicine services alongside urgent care may run fewer in-house tests, as drug screens must often be sent out to specific labs chosen by the employer.
- Procedure-heavy clinics may rely more on visual diagnosis and imaging than lab testing.
- Clinics with workers’ compensation services likely have more repeat follow-up visits that don’t require additional testing.
The Role of Standing Orders
One of the most effective ways to streamline urgent care lab operations is the use of standing orders. These standardized protocols authorize your staff to perform certain tests before a provider even sees the patient based on presenting symptoms and patterns of illness in the community.
Take a spike in local strep cases. With standing orders in place, every patient who comes in with a sore throat and fever can be tested right away with no need to wait for a provider’s evaluation. This simple change can make your clinic’s operations much more efficient.
The benefits of standing orders include:
- Shorter visit times and increased throughput
- Higher patient satisfaction
- More consistent clinical outcomes
- Increased lab revenue
Despite this, some clinics choose to relax their standing orders during slower months when the risk of certain viral illnesses is lower. But standing orders aren’t a seasonal tool; they’re a best practice. Influenza and COVID-19 aren’t restricted to a school calendar. If a patient shows up with symptoms, it’s still worth testing. Removing standing orders based on seasonal assumptions can both reduce clinical quality and decrease your clinic’s revenue.
CLIA-Waived vs. Moderately Complex Testing
Understanding the difference between moderately complex and CILA-waived testing is essential when planning your urgent care lab services. Most clinics begin with the latter due to its simplicity. However, both categories come with important regulatory and operational considerations—and both have a direct impact on your clinic’s efficiency and profitability.
CLIA-Waived Testing
Before doing any lab testing, facilities must be certified under the Clinical Laboratory Improvement Amendments of 1988 (CLIA). However, since certain “instant” lab tests are both incredibly accurate and simple to run, CLIA provides a waiver for medical practices performing only these types of tests.
Most urgent care testing falls into this category. Common CLIA-waived tests include rapid strep and flu, COVID-19 antigen and PCRs, urine pregnancy, dipstick urinalysis, fingerstick glucose, and some urine drug screenings. Some clinics are also adding CLIA-waived STI tests as demand for sexual health services grows.
While waived testing is less burdensome than more complex testing, it’s not exempt from compliance. Your clinic will still need to obtain a CLIA Certificate of Waiver to offer these tests, even if you aren’t billing separately for them. Urgent care clinics can (and are) still inspected, especially in response to complaints or issues flagged during billing reviews.
To stay compliant, you’ll need to:
- Follow all manufacturer instructions for administering the tests
- Maintain documentation for quality control and staff training
- Ensure testing supplies are within expiration dates and stored correctly
- Record and retain test results and equipment maintenance logs
Moderately Complex Testing
Some urgent care centers choose to add moderately complex lab services as they grow. These tests allow for more useful clinical insights, such as CBCs, blood chemistry, and more detailed infectious disease panels.
However, moderately complex testing isn’t typically performed in-house unless the clinic is prepared to meet a much higher regulatory bar. Most urgent cares send these tests to reference labs like LabCorp or Quest Diagnostics, which often provide next-day results in metro areas. This reduces the internal burden of complying with advanced regulations while still delivering fast and accurate results for the patient.
If you choose to bring moderately complex testing in-house, be aware that your clinic will need to meet several additional requirements, including:
- Having a qualified laboratory director
- Ongoing staff competency assessments
- Extensive documentation and policies
- Regular proficiency testing and external inspections
- A more expensive CLIA certificate (currently starting at $223 biennially for a certificate and $446 for a survey, but scaling much higher in line with volume)
CMS provides an updated test complexity database online, along with requirements for laboratory personnel and inspections. For most startup urgent care clinics, it’s smart to begin with CLIA-waived testing and gradually expand as needed. As your patient volumes grow or the needs of your population change, you’ll be better positioned to decide when (or if) to add in-house moderately complex lab testing.
Understanding Reimbursement Strategy
The decision to offer specific lab tests in your clinic often comes down to the numbers. Understanding how you’ll be reimbursed is key to building a lab strategy that makes sense for your business. Some tests are profitable. Others aren’t.
There are two primary reimbursement models for urgent care, and they treat labs very differently. Depending on whether your clinic is reimbursed based on fee-for-service pricing or case rates, the same test can either generate revenue or hurt your bottom line.
With a fee-for-service model, you’re reimbursed for each service you provide, including labs, based on individual billing codes. The more services you deliver, the more revenue you bring in—at least on paper. But not all tests are profitable. If a test costs your clinic $30 to run and the payer only reimburses $12, you’re losing money every time you run it. Though the fee-for-service model has traditionally been favored in urgent care, and can make in-house lab testing appealing, it’s important to understand and analyze your specific reimbursement rates to ensure you’re making a smart financial choice.
In a case rate model, you receive a flat fee for the entire visit, regardless of whether you’re treating the patient for a sore throat or a broken arm. This means lab testing can’t be billed separately. Instead, it’s considered an overhead cost like cotton balls or other clinic supplies. In a case rate environment, every test you run eats into your margin. Like any overhead, these costs need to be managed by being selective about which tests to bring in-house and which to send out.
Your urgent care clinic’s unique reimbursement dynamics also influence which version of a test you offer. Whether you use rapid antigen or PCR tests for COVID-19 patients, for instance, may depend entirely on the structure of your reimbursement contracts and cost-to-revenue ratio of your clinic. PCRs are more accurate and may bill at a higher rate, but using them only makes financial sense if your payer mix supports it.
This is why, in the early stages of opening a new urgent care, it’s wise to start with a core slate of CLIA-waived tests. They are inexpensive, clinically valuable, and easy to run in-house. As your patient volume increases and payer contracts become more predictable, you can begin to evaluate the ROI of adding more complex or higher-cost diagnostics to your offerings. But until you know how much you’re getting paid—and how much each test costs to run—adding complexity can backfire.
Need a Better Lab Strategy for Your Clinic?
From strep tests to COVID PCRs, the right mix of diagnostics speeds up visits, improves outcomes, and supports your bottom line. Lab services are a core part of what makes urgent care effective and preferred by millions of patients. However, they aren’t one-size-fits-all. Successfully integrating lab services into your strategy requires a clear understanding of operations, compliance, and reimbursement.
At Urgent Care Consultants, we help clinics make lab decisions that support their business goals. Whether you’re launching a new urgent care business or are refining an existing operation, we can help you identify an ideal menu of lab services, avoid costly mistakes, and scale your clinic effectively.
Schedule a no-risk consultation today to discuss how we can help your urgent care business optimize your lab testing.