NL spending millions on wasted lab capacity for Covid tests: report

The Netherlands has been paying eight large laboratories millions of euros per month for coronavirus test capacity that is largely unused. At the same time, thousands of tests per day are sent to other labs at an additional cost of 65 euros per test, the Volkskrant reported based on its own research.

Last autumn there was unrest when coronavirus infections spiked in the Netherlands and residents had to wait long for Covid-19 tests because there was not enough lab capacity to analyze all the tests being taken. The government then signed contracts with eight large laboratories, good for processing over 120 thousand tests per day in total, to guarantee lab capacity. 

These high-volume labs are paid for a guaranteed number of tests, whether they are analyzed or not, up to a maximum of 30 percent. This means that a lab that agreed to analyze 30 thousand tests per day will definitely get payment for 10 thousand tests per day, at 60 euros per test, whether they are analyzed or not. In this example, this amounts to  just under 2 million euros per day in guarantees. 

Only about 45 thousand tests are done per day at present - much less than the 120 thousand the eight high-volume labs can process. Currently, these eight labs get sent about 55 percent of the taken tests, according to figures the Volkskrant got from the Testing Service. The other 45 percent of tests are sent to 56 other laboratories, with which no guarantee contracts were concluded. The government has to also pay for these tests to be analyzed.

Up to last week, the high-volume lab in Utrecht analyzed about 2 thousand tests per day. Another about 2 thousand daily tests were sent to the UMC Utrecht hospital lab at about 65 euros per test, according to the newspaper. In this region alone the government paid nearly 1 million euros per week for tests that could have been covered by the guarantees already paid to the Utrecht high-volume lab located only five kilometers away from UMC Utrecht, the Volkskrant calculated.

In a response to the newspaper, Minister Hugo de Jonge of Public Health said that "the guarantees were entered into to be able to guarantee lab capacity at a time when this capacity was scarce and the test demand high." He would not disclose how much money is involved in these guarantees, and how much of that guaranteed capacity is unused. He did say that by continuing to send tests to small labs, the "regional diagnostic infrastructure" is maintained. "Then testing costs outweighs the benefits, namely preventing the virus from spreading," he said. 

"The model is designed in such a way that peaks and dips in test demand can be absorbed without any problems without diverting flows. Changing that in the short term can pose great risks with new peak loads," he said.