Sleep Labs Director – A Day in the Life

People are often surprised to learn that sleep is a medical specialty that extends far beyond mere wellness offerings. With roots in pulmonology and neurology, the practice of sleep medicine requires the physician to complete one additional year of fellowship and pass one another set of medical boards. Only after the successful completion of both may the physician practice as a sleep medicine specialist, completing interpretation reports for diagnostic studies.

There are many different types of sleep disorders, but obstructive sleep apnea (OSA) is by far the most common. OSA risk increases with male gender, obesity, larger neck circumference, and retrognathia (overbite), among other risk factors.

The only way to definitively diagnose or rule out sleep disorders is with a sleep study. Sleep studies are diagnostic tests that may take place at home or in a sleep lab overnight. The data from studies are analyzed and scored by trained sleep technologists, then reviewed by a sleep physician, who finalizes the interpretation and signs the report.

Any prescribing provider can write a sleep study order, but only a sleep board-certified physician may finalize an interpretation report for one. The sleep lab director is responsible for all of the operations related to this diagnostic component—the sleep study—of the clinical care process.

Types of Sleep Testing

Polysomnography (PSG) is the gold standard and the most comprehensive type of sleep study. A PSG takes place overnight in a lab facility, with patient set-up and monitoring by a trained sleep technologist. The tech observes the patient and their biometric data variables side by side as they are occurring in real time while the patient sleeps.

These captured data are later scored, sometimes by a different tech. PSG studies generate a large portion of the revenue for most labs, but the equipment needed to run them is very expensive.

A home sleep apnea test (HSAT) is a portable device that can capture some of the same data measurements for later scoring and interpretation. It is much more limited in diagnostic capabilities, and not appropriate for all patients. Most sleep labs also provide HSAT units in addition to PSGs. HSAT studies generate far less revenue, but the equipment is less expensive compared to that required to run a PSG.

Obtaining prior authorization approval from insurance, too, is generally much easier to get for the HSAT than the PSG.

Sleep Disorder Treatment

Treating sleep disorders is as important as testing for them. Almost every type of sleep-disordered breathing—including the most common, obstructive sleep apnea—is treated with a CPAP machine. The machine works by blowing pressurized air through a tube connected to a mask worn on the face during sleep. By propping open the airway to reduce or eliminate collapse, breathing cessations are reduced, and sleep quality is thereby improved.

There is no cure for sleep apnea, and surgical treatment remains less effective than CPAP. It can take patients some time to get used to consistently wearing a CPAP machine, but compliance to therapy has proven highly effective at mitigating the health risks of untreated sleep-disordered breathing. These risks include but are not limited to:

  • Increased risk of heart attack or stroke
  • Increased difficulty in managing diabetes
  • Daytime fatigue
  • Worsened mood
  • Poor cognitive performance
  • Increased risk of accidents

Some research has suggested that untreated sleep-disordered breathing may even enhance vascularization of cancerous tumors, by way of the intermittent hypoxia (i.e., insufficient oxygen) caused by the cessations of breathing that occur repeatedly throughout the night. In some patients, this partial or complete cessation of breathing and subsequent drops in blood oxygen may occur many hundreds of times all night, every night. This damages the body in many different ways and the condition tends to worsen over time with age.

What are Sleep Clinics and Sleep Technologists?

A sleep clinic is a type of doctor’s office in which one or more of the physicians is currently board-certified in sleep medicine. A sleep lab is a specialized testing facility with patient beds that are outfitted with the medical equipment needed to run studies.

PSG testing requires patients to stay in the facility overnight, so the testing rooms look a lot like small hotel rooms, just with some pieces of medical equipment and cameras.

The sleep technologist staff are the critical piece of the operations; they must undergo specific training and clinical rotations and pass a certification test before they may run studies independently. They interact directly with patients and are very much the experts in the capture and scoring of study data. The sleep lab director is responsible for managing this team and their working environment, soup to nuts.

How Does a Polysomnography (PSG) Study Work?

To run a PSG study, the tech hooks the patient up to many different equipment leads, before heading to the control room and waiting for the patient to fall asleep. The tech, often sitting with other techs, observes the patient overnight and their data feeds in real time. These biometric data are captured and saved for scoring.

Unless a patient is especially complex, one tech usually runs two studies at the same time. In the morning, the tech wakes up the patient, removes the leads, and disinfects the equipment, before they submit confirmation of study completion into the appropriate system for billing.

Some labs have additional responsibilities that can include staging the study, scoring the data, stripping the bedsheets, or checking supply inventory. The physical structure, storage, and sanitization of equipment must be in accordance with regulatory requirements. Ensuring the staff members are following all regulatory requirements without fail is one of the most important components of the lab director role.

There are also techs who work during the daytime. They may run PSGs for patients who normally sleep during the day and work at night. They may run a multiple sleep latency test (MSLT) type of study, which is a series of naps over the day and is part of the process to diagnose narcolepsy. They may hold the role of a dedicated scoring tech, who does not run studies themselves but scores those run by other techs.

HSAT devices and their study data are also handled by sleep techs, usually day techs. Some labs choose to distribute devices by mail; others distribute devices in person if they share space with a clinical sleep practice. In-person distribution has the benefit of a lower test failure rate because patients can receive live set-up demonstration, before taking the unit home with them.

Most labs have both mail and pick-up because some insurance plans require live demonstration and training be provided to the patient. However the device travels, the data captured on it must be downloaded, scored by a tech, and then interpreted by a physician, just like a PSG study.

Other Key Roles in a Sleep Lab

Scheduling coordinators are the administrative framework responsible for bringing incoming orders through to study completion. Like techs, they interact directly with patients daily, but they also spend just as much time (if not more) communicating with insurance companies and referring doctor offices.

Processing a study order has multiple steps that include verification of patient demographics, confirmation of active coverage, prior authorization submission, and of course, communicating with patients directly for scheduling tests. Scheduling coordinators usually report to the lab director, but a large lab may have a manager specific to the coordinator team. Streamlined processes for the scheduling coordinators are important to minimize turnaround time for orders and to maximize approvals for PSG over HSAT studies whenever possible and medically appropriate.

An important role that does not report to the lab director (but does work very closely with them) is that of the medical director. The medical director must be a physician who is board-certified in sleep medicine. This role takes ownership of all medical decision making within the lab activities and workflows, and they usually complete study interpretations for the lab as well.

Required Skills and Knowledge for Sleep Lab Directors

A sleep lab director frequently comes from a sleep technologist background but it is not a requirement. A wide range of skills is needed to for success in the role and new lab directors will benefit from taking proactive steps to ensure development in potentially weaker skillsets.

An especially critical area of knowledge would be the regulatory and accreditation standards of relevance, including the American Academy of Sleep Medicine (AASM) lab accreditation standards. These cover requirements on the physical space, clinical processes, emergency event preparation, and even staffing ratios. Indeed, all accountability roads lead to the sleep lab director.

A background knowledge of common sleep disorders, how they are diagnosed, and how they are treated is also important for success in the role. There is no single pathway or specific order of operations upon which patients proceed through the sleep disorder diagnostic process, so it cannot be simplified to a consistent sequence of steps alone. Rather, it must have appropriate flexibility to allow for multiple diagnostic pathways to be undertaken, all of which are designed to achieve the goal of a diagnosis or confirmation that sleep disorders have been ruled out.

This background knowledge is also very important for understanding the referral relationships that feed business to the sleep lab. Identifying and cultivating these referring groups and providers helps to encourage a more predictable volume of incoming orders. Cardiology, pulmonary, neurology, internal and family medicine, geriatrics, bariatric surgery, and endocrinology are all specialties of significant relevance to sleep medicine—as in, they have an overlap in the patient health outcomes for which effective treatment of a sleep disorder can lessen the severity of the comorbid condition of focus.

Finally, it’s helpful to use this knowledge to better understand the general health characteristics and common conditions that will be encountered in the testing population. More complex patients will require more complex protocols, oversight structures, and specialized equipment such as oxygen concentrators or sleeping loungers to conduct an effective and safe study. Being fluent in the appropriate terminology is important to ensure that working with the medical director on the design of specific protocols to handle these more complex populations is a smooth and effective process.

Given the importance of maintaining stable cash flow, financial fluency is also critical. Many lab directors have an MBA or MHA degree, but hands-on learning with financial data can be sufficient so long as there is the capability to understand how the numbers correspond with actual lab activity, and to ensure operations are sufficiently profitable such that overhead costs of the facility can be more than covered.

A related area of knowledge that is equally important is that of the structures, rules, and processes of Medicare, Medicaid, and private insurance payers. Specifically, an understanding of insurance coverage verification, prior authorizations and referrals, denial appeals, out-of-pocket costs, and deductibles, are all necessary to optimize profitability for the lab and how it handles incoming orders. This in turn links back to the general sleep disorders knowledge—specifically, the common comorbid conditions because the presence of relevant medical conditions is often referenced in the submission of prior authorizations to insurance companies to justify testing, particularly PSG.

Management experience is a significant value-added, as most directors will work daytime hours but most of their staff work overnight, which allows for much less opportunity to directly observe staff during their shift. The director is ultimately responsible for how effectively staff can ensure facility safety and regulatory compliance, without their immediate presence at all times.

Conclusion: Working in a Sleep Lab

A sleep director role is one of the more unusual leadership positions found in healthcare, and for those who prefer an atypical work schedule, it can be a terrific fit. It can be a challenging position for less experienced managers, but a great one for someone with experience in compliance or regulatory oversight from any safety sensitive industry.

In most areas, running a sleep lab remains a relatively profitable activity, and demand for sleep medicine continues to grow as recognition of sleep disorders becomes more widespread. It is estimated that only one in four patients with sleep apnea have been diagnosed, and our nation continues to increase its risk factors (e.g., obesity) for sleep-disordered breathing.

At the same time, innovations in diagnostic devices continue to push reimbursement rates down lower and increase the hurdles to obtain approval for in-lab PSG tests, which historically have always been (and as of now remain) the largest source by far of lab revenue. It becomes increasingly challenging to achieve a positive return with HSAT devices, and yet harder to get approval for PSG testing. Hiring trained sleep technologists is increasingly difficult, and in parallel, AI is beginning to replace many of their highest-level functions, such as scoring, for some FDA-approved devices, but only the most limited devices, appropriate for part of the population, for the time being.

Overall, sleep medicine will experience substantial disruption from this confluence of forces. All signs indicate that the process has already begun and will only speed up from here on out.

Healthcare leaders and experienced sleep technologists who seek a challenging role guiding through change and would benefit from the flexibility of the hours may wish to consider exploring a sleep lab director role. The field needs leaders capable of guiding labs through what will surely be a tumultuous transition with an uncertain future destination.

What is certain, however, is the already high and still growing prevalence of sleep-disordered breathing, and the medical care costs associated with leaving it untreated, ultimately increasing healthcare costs for everybody. This is something that we should not be sleeping on.

Elizabeth Bradford Kneeland, MBA
Elizabeth Bradford Kneeland, MBA

Elizabeth Kneeland is a writer and entrepreneur living in Philadelphia. As a small business owner, she spends much of her time creating content, researching markets, and refining financial models. Her career has straddled novel operational and financial modeling, and traditional academic research within the healthcare sector, providing her with a unique perspective on programmatic development. She built the first for-profit telemedicine program for the University of Pennsylvania Health System in 2015. She also has helped build and scale sleep medicine startups in the U.S., China, and Taiwan.

Kneeland has co-authored publications in peer-reviewed journals on topics ranging from device validation to clinician-level educational interventions and has been an invited speaker at medical conferences throughout the U.S., China, and Taiwan. She has most recently contributed to discussions on healthcare technology as a research analyst focused on analytics, real-world data, and patient privacy legislation.

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