For years, a well-respected and established pathology lab in Los Angeles, California, had gotten by with its old Laboratory Information System (LIS). The system was familiar, stable, and (of course) paid for. However, soon came the frictions:
Test results were delayed, new instruments didn’t integrate nicely, and every minor update required an IT bridge to hold things together. Then came a sudden system freeze during a shift change – an alert that quietly shook leadership.
While no harm was done, it became clear that the frozen screen was a warning label, not just an inconvenience. And so, the lab’s stakeholders started looking into an LIS upgrade. We’ll give you a summary – they ended up spending it for several years, but after spending so much more, they ended up upgrading.
But at what cost…?
A Breakdown of “Keeping the Lights On”
No matter how hard we try to ignore it, outdated lab systems carry a baggage of invisible and ongoing costs. Here’s how they add up:
- Ongoing maintenance and staff burnout: A recent study on legacy IT platforms found organizations typically spend 60–80% of their IT budget just maintaining old systems, with costs climbing 10–15% each year those systems remain untouched.
- Risk and rising cybersecurity bills: Legacy systems are magnets for breaches. In healthcare, the average cost of a data breach reached nearly $9.8 million in 2024, and one breach can shut down testing, halt billing, and trigger regulatory headaches.
- Workflow drag and fragmented data: When systems don’t talk to each other, staff spend extra hours re-entering data, running parallel systems, or manually consolidating records. One industry analysis estimated this could cost hospitals $8.3 billion per year in lost productivity, translated to overloaded days and squeezed turnaround times.
Understanding the Real Costs of an LIS Upgrade
An LIS upgrade isn’t just about installing new software – and it’s really not about the time of implementation, the costs, and the training. Naturally, these are all part of the process, but the advantages surpass the cons. Upgrading your LIS is a project that touches nearly every aspect of your lab’s operations, and its costs fall into a few main categories:
1. Software and Licensing
Whether you choose a subscription-based model or a perpetual license, platform fees can widely vary depending on the size and complexity of your lab. For small and mid-sized operations, the total cost of ownership can be in the 6-figure area. This includes modules for areas like microbiology, molecular diagnostics, and integration with electronic health records (EHRs).
2. Implementation and Integration
Connecting a new LIS to your existing systems – like instruments, billing platforms, and EHRs – requires specialized work. Labs often underestimate how much time and coordination this takes. Integration work might add tens of thousands of dollars to the overall project, but it’s also what ensures that the LIS becomes a fully functioning part of your ecosystem, rather than a standalone operation. The real challenge is that many LIS vendors simply do not supply the proper integration tools and solutions.
Note we mentioned “many” – not all.
3. Data Migration
Years of test records, patient data, and quality control documentation don’t just transfer themselves. Migration is one of the most delicate parts of the process, involving mapping, validation, and testing. Errors here can have clinical consequences, so many vendors (or IT teams, both in labs and from the vendor side) take a conservative approach, which adds to the costs, but with good reason.
4. Training and Change Management
Rule of thumb – even the best LIS is only as good as the people using it. Labs need to plan for user training, downtime during transition, and early-stage support. There may be a few rough weeks, but neglecting this phase can delay the return to full productivity. Some vendors charge extra for training, some don’t, but the result is always the same – it’s a must.
5. Ongoing Support
Modern LIS systems are typically updated regularly for security, functionality, and regulatory compliance. Support contracts can cost in the realm of 15–20% of the system’s annual cost, covering bug fixes, upgrades, and helpdesk access.
These costs aren’t insignificant, and the real question is: what’s the cost of staying where you are?
LIS Upgrade: Costs of Inaction
Every year, labs spend significant resources working around the limitations of outdated LIS platforms – often without realizing how much it adds up. As humans tend to do, turning a blind eye is easier than being confronted with the harsh reality. And in this case, the reality is that digital inefficiencies in lab workflows can reduce overall lab productivity by up to 20%, according to several industry studies.
That translates into longer turnaround times, duplicated effort, and frustrated staff. Over time, these hidden costs exceed the one-time expense of an upgrade. In addition, there are other common issues with legacy systems, including:
- Incompatibility with newer instruments or billing requirements
- Security vulnerabilities, especially as older systems age out of support
- Limited scalability for labs looking to grow or diversify services
- Compliance risks, particularly when accreditation standards evolve
Put simply, outdated systems slow down your lab, limit your flexibility, and increase the chances of costly errors. From our 30+ years of experience, in most cases, when the lab stakeholders feel it’s time for a change, they’re right. But taking the first step is always the hardest.
When Standing Still Means Falling Behind
Upgrading your LIS isn’t just about keeping up with technology. An LIS upgrade is about creating space to improve quality, reduce errors, and prepare for the future. Whether you’re expanding services, connecting with mobile phlebotomy teams, or integrating molecular diagnostics, the right system should support those moves, not block them.
At LabOS, we’ve helped labs through this transition. Our platform was built with integration, scalability, and usability in mind. But whether you choose LabOS or another provider, the message is the same: putting off your upgrade can cost more – financially and operationally – than taking the leap.
Bottom line – if your LIS is holding you back, maybe it’s time to do something about it. The price is more than worth it.
➡️ DO SOMETHING ABOUT IT!
