CAP Laboratory Improvement Programs. Comparative Analytical Costs of Central Laboratory Glucose and Bedside Glucose Testing

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CAP atory Improvement Programs Comparative Analytical Costs of Central atory Glucose and Bedside Glucose Testing A College of American Pathologists Q-Probes Study Peter J. Howanitz, MD; Bruce A. Jones, MD Context. One of the major attributes of laboratory testing is cost. Although fully automated central laboratory glucose testing and semiautomated bedside glucose testing (BGT) are performed at most institutions, rigorous determinations of interinstitutional comparative costs have not been performed. Objectives. To compare interinstitutional analytical costs of central laboratory glucose testing and BGT and to provide suggestions for improvement. Design. Participants completed a demographic form about their institutional glucose monitoring practices. They also collected information about the costs of central laboratory glucose testing, BGT at a high-volume testing site, and BGT at a low-volume testing site, including specified cost variables for labor, reagents, and instruments. Participants. A total of 44 institutions enrolled in the College of American Pathologists Q-Probes program. Main Outcome Measure. Median cost per glucose test at 3 testing sites. Results. The median ( percentile range) costs per glucose test were $1.18 ($.9 $.36), $1.96 ($9.1 $.77), and $4.66 ($27.4 $1.2) for central laboratory, high-volume BGT sites, and low-volume BGT sites, respectively. The largest percentages of the cost per test were for labor (9.3%, 72.7%, and 8.8%), followed by supplies (27.2%, 27.3%, and 13.4%) and equipment (2.1%, %, and %) for the 3 sites, respectively. The median number of patient specimens per month at the high-volume BGT sites was 62 compared to 3 at the low-volume BGT sites. Most participants did not include labor, instrument maintenance, competency assessment, or oversight in their BGT estimated costs until required to do so for the study. Conclusions. Analytical costs per glucose test were lower for central laboratory glucose testing than for BGT, which, in turn, was highly variable and dependent on volume. Data that would be used for financial justification for BGT were widely aberrant and in need of improvement. (Arch Pathol Lab Med. 24;128:739 74) Two of the most important characteristics of a successful justification for implementing new health care technologies are that medical care will be improved and that costs will be reduced. A successful justification is no different for clinical laboratory technologies, in which the outcomes and costs of a proposed technology are expected to demonstrate improvement in comparison with the current technology. During the past 2 years, laboratory medicine has undergone a major change with the implementation of point-of-care testing (POCT), which entails nonlaboratory personnel performing laboratory tests at patients bedsides rather than having laboratory personnel perform these procedures in a central laboratory. Also, POCT usually is performed by personnel who manually or semiautomatically perform individual measurements, as compared to central laboratory testing, in which dedi- Accepted for publication March 1, 24. From the Departments of Pathology, State University of New York, Downstate Medical Center, Brooklyn (Dr Howanitz), and St John Hospital, Detroit, Mich (Dr Jones). Dr Jones currently is at the Department of Pathology, Henry Ford Health System, Detroit, Mich. The authors have no relevant financial interest in the products or companies described in this article. Reprints: Peter J. Howanitz, MD, Department of Pathology, State University of New York, Downstate Medical Center, 4 Clarkson Ave, Box 2, Brooklyn, NY 1123-298 (e-mail: phowanitz@downstate.edu). cated personnel perform high-throughput, fully automated testing. Currently, the most common POCT is performed for blood glucose determinations, and because this procedure currently is performed in most hospitals, it serves as a model for implementing other POCT. The cost of bedside glucose testing (BGT) has been studied, but the medical literature on this topic is confusing, contradictory, highly variable, and frequently a matter of opinion. Zaloga 1 found BGT less costly than clinical laboratory testing when used in an intensive care unit. In contrast, 6 different studies found central laboratory testing less costly than BGT. 2 7 However, Lee-Lewandrowski and colleagues 8 reported that in their institutions, BGT costs were higher than central laboratory glucose determinations in most situations; however, in some high-volume situations, BGT costs were lower. De Cresce and colleagues 9 compared cost accounting among published studies and concluded that differences, in part, were due to unique institutional factors where the testing was performed, the sites and technologies that were compared, and the costs that were included or excluded in the cost comparisons. Since 1989, the College of American Pathologists (CAP) has sponsored more than 1 voluntary Q-Probes quality improvement studies for anatomic and clinical pathology laboratories. We report the results of a recent Q-Probes Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones 739

Institutional characteristics of participating institutions. study aimed at describing the comparative analytical costs of central laboratory glucose testing, a high-volume BGT, and a low-volume BGT site in a large number of institutions and provide recommendations for improvement. MATERIALS AND METHODS Participants enrolled in the CAP Q-Probes program participated in the study using the usual Q-Probes format. 1 Practice variables were obtained from the yearly participant demographic form. Four input forms were required to be completed: one for general information, a second for the central laboratory, a third for a high-volume BGT site, and a fourth for a low-volume BGT site. The questionnaires for the 2 BGT sites were identical, and the input form for the central laboratory was nearly identical to those for the BGT sites, as it required consideration of additional consumable costs, such as pipette tips. Although laboratory personnel completed the BGT input forms, discussions with BGT testing personnel were required to answer the questions about POCT. Inpatient nursing personnel identified a high-volume and a low-volume BGT site to enter into the study. Personnel at these testing sites collected BGT data for a month, including the number of patient specimens tested, repeated, or referred to the clinical laboratory, as well as the number of quality control (QC) specimens tested. All input forms were precoded to aid the accurate collection of numerical information, and costs were expressed in US dollars. Participants collected data about their costs per test according to the following equations for each of the 3 sites. A full-time equivalent (FTE) was defined as an employee who worked 4 hours per week, personnel salaries included benefits, time spent for glucose testing included oversight and competency assessment, and QC included the cost of proficiency testing. Central atory Glucose Testing Cost per Test (Cost of ) ( Patient Glucose Specimens) where Costs [( Instruments Leased)(Annual Lease Payment) ( Instruments Purchased)(Purchase Price)/(Life Expectancy) ( Yearly Maintenance Contracts)(Average Yearly Maintenance Cost)] [( Glucose Measurements/Total Measurements)]; Supply Costs (Costs of Reagents QC Materials Consumables); and Costs (Median Salary of Primary Testing Personnel)(% Time Spent by Primary Personnel on Glucose Testing)( Primary FTEs) (Median Salary of Secondary Testing Personnel)(% Time Spent by Secondary Personnel on Glucose Testing)( Secondary FTEs). Bedside Glucose Testing Cost per Test (Cost of ) ( Patient BGT Specimens) where Costs [( Instruments Leased)(Annual Lease Payment) ( Instruments Purchased)(Purchase Price)/(Life Expectancy) ( Yearly Maintenance Contracts)(Average Yearly Maintenance Cost)] [( Glucose Measurements/Total Measurements)]; Supply Costs (Costs of Reagents QC Materials Consumables); and Costs (Median Salary of Primary Personnel)(% Time Spent by Primary Personnel on BGT Testing)( Primary FTEs) (Median Salary of Secondary Testing Personnel)(% Time Spent by Secondary Testing Personnel on BGT Testing)( Secondary FTEs). Participants were ranked by percentiles, with those with lowest costs defined as the highest percentiles and those with the highest costs defined as the lowest percentiles. When participants failed to answer a question, they were excluded from the data analysis for that question only. We tested the statistical significance of practice variables on the cost of glucose testing using the nonparametric Kruskal-Wallis and Wilcoxon tests and considered P. as significant. RESULTS A total of 44 institutions submitted data for this study. Most (9.7%) were from the United States; the remainder were from Canada, the United Kingdom, Australia, Argentina, Saudi Arabia, and Spain. The Figure highlights some of the characteristics of participating institutions. The calculated cost per glucose test was computed for 74 Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones

Location of Glucose Testing* Nursing units with high BGT volume Nursing units with low BGT volume All institutions percentiles. Table 1. Calculated Costs for Glucose Testing Institutions 341 317 282 3.78.13 16.49 Cost per Test, $.9 9.1 27.4 1.18 1.96 4.66.36.77 1.2 Table 2. Total Costs of atory Glucose Testing Variable Costs per Test, $ Reporting.37 3.79 6 Phlebotomy and transportation.8 8 1.28 4 Overhead.48 8 Total range 1.7 2.8 Analytical costs Analytical, central laboratory Analytical, point-of-care, high volume Analytical, point-of-care, low volume Total costs* Point-of-care, high volume Point-of-care, low volume.36.9.77 9.3 1.2 16.49 2.6 8.17 2.44 12.9 2.72 19.7 * Total costs represent analytical costs plus literature values for reporting, phlebotomy, transportation, and overhead. and percentile, respectively. Table 3. Percentage of Costs for Glucose Testing* Budget Item (n 341) 1 33.2 6.8 All Institutions Percentages.7 11.2 Nursing units with high BGT test volume.2 32.9 66.9 6.1 27. Nursing units with low BGT test volume.4 23.7 76. 2.6 3.8 2.1 27.2 9.3 27.3 72.7 13.4 8.8 29.7 69.8 91..2 73. 93.7.4 64.2 97.3 * For each participant, equipment, supplies, and labor costs totaled 1% for each of the 3 sites. BGT indicates bedside glucose testing. individual institutions using their reported actual costs for equipment, supplies, and personnel, as seen in Table 1. Overall, the analytical cost per test for glucose testing was lowest in central laboratories, intermediate in high-volume BGT sites, and highest in low-volume BGT sites. Median costs per test were $1.18, $1.96, and $4.66 for central laboratory, high-volume BGT, and low-volume BGT sites, respectively. However, costs were highly variable among participants. glucose testing costs per test tended to be lower for teaching institutions (P.3). Table 2 contains cost-per-test data when phlebotomy, specimen transportation, result reporting, and indirect costs for space determined for clinical laboratory glucose testing were added to our analytical costs determined for those at the and percentile for all 3 testing sites. Table 3 displays the percentages of total costs divided into equipment, supplies, and labor by institution for glucose testing at each of the 3 locations. Median equipment costs were 2.1% of the total analytical testing costs for the central laboratory, whereas for BGT they were % of the total costs for BGT. Median labor costs were 9.3% of the total costs for central laboratory testing, compared with 72.7% and 8.8% of the total costs for high-volume and low-volume BGT sites, respectively. Table 4 contains participants monthly costs for equipment, supplies, and labor used for glucose testing in the central laboratory and for BGT. Total costs for the median high-volume BGT, low-volume BGT, and central laboratory were $131.67, $39.33, and $2711.13, respectively. Most participants had no equipment costs for BGT. For the median high-volume BGT site and low-volume BGT site, expenses were greater than % and 1% of the median central laboratories glucose costs, respectively. The monthly costs for glucose testing competency training in the central laboratory and for BGT testing in nursing units are seen in Table. The median cost of competency training was highest ($28.47) for high-volume BGT sites, intermediate ($2.72) for clinical laboratories, and lowest ($13.34) for low-volume BGT sites. Participants ranked at the mean assessed competence of long-standing laboratory employees in 2 hours and a new laboratory employee in 13 hours per year. In contrast, at high-volume BGT sites, long-time as well as new employees achieved competence in a mean of 2 hours per year, whereas at lowvolume BGT sites, long-standing employees achieved competence in a mean of 1 hour and new employees in a mean of 2 hours per year. Table 6 contains statistics for BGT testing. The median high-volume site measured more than 2 specimens and 4 QC samples per day, remeasured a patient specimen about every 3 days, and referred a patient specimen to the clinical laboratory about once per week. The median lowvolume laboratory measured a patient specimen daily, repeated a patient specimen about once per month, and performed more measurements of QC samples than patient specimens. Most low-volume laboratories did not refer a patient specimen to the clinical laboratory on a monthly basis. In contrast, the median clinical laboratory performed 114 patient glucose measurements daily. Participants estimated costs per each central laboratory and BGT test are shown in Table 7. When compared to median estimated costs, median calculated costs seen in Table 1 were 1.76, 1.63, and 3.6 times higher than estimated costs for central laboratory, high-volume BGT and low-volume BGT sites, respectively. The majority of participants did not include variable costs of labor, mainte- Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones 741

Table 4. Budget Item* Institutions 412 44 369 Nursing units with high BGT volume 43 391 333 Nursing units with low BGT volume Monthly Costs for,, and Used for Glucose Testing 431 377 3 23.94 1448.7 744.49 1.99 78.8 3237.91 1.1 14.4 937.23 All institutions percentiles; higher percentiles indicate better performance. 198 263. 13 339. 1.67 883. 73.8.83 198. 1938.26 Monthly Costs, $ 14.13 882. 172. 44 191.67 48. 342.33 23 21.7 129. 22.32 14. 39.29 Location of Glucose Testing* Nursing units with high BGT volumes Nursing units with low BGT volumes All institutions percentiles. Table. Monthly Competency Training Costs Institutions 38 326 293 47.78 46.31 23.77 Calculated Costs, $ 96.92 94.3 2.67 2.72 28.47 13.34 3.14 3.88 1.9 Table 6. Glucose Volume Statistics Characteristics* Institutions glucose Glucose patient specimens analyzed per month 437 4191 697 Glucose QC specimens analyzed per month 437 34 6 Glucose repeat specimens analyzed per month 419 13 1 Nursing unit with high BGT volumes BGT patient specimens analyzed per month 411 88 1 BGT QC specimens analyzed per month 418 19 6 BGT repeat specimens analyzed per month 388 27 1 Glucose specimens sent to central laboratory per month for verification of BGM result 389 26 Nursing units with low BGT volumes BGT patient specimens analyzed per month 41 13 BGT QC specimens analyzed per month 46 4 9 BGT repeat specimens analyzed per month 381 Glucose specimens sent to central laboratory per month for verification of BGM result 381 4 * QC indicates quality control; BGT, bedside glucose testing; and BGM, bedside glucose monitoring. All Institutions Percentiles 364 18 6 62 12 1 3 42 1 934 6 3 1 31 6 31 214 9 8 nance, competency assessment, or oversight in their BGT estimated costs. In contrast, most laboratorians included QC material, reagents, labor costs, and consumable supplies in their variable costs. Table 8 lists the percentages of primary and secondary personnel responsible for glucose testing at each of the sites. The median salary for central laboratory primary and secondary testing personnel were $38 979 and $31 12, and these employees spent 7% and % of their time performing glucose measurements, respectively. The median salary for BGT primary and secondary testing personnel were $36 76 and $29 486, and these employees spent 11% and % of their time performing glucose measurements, respectively. COMMENT There are many differences in the assumptions that have been made among studies to include or exclude some cost- 742 Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones

Location of Glucose Testing* Nursing units with high BGT volume Nursing units with low BGT volume All institutions percentiles. Table 7. Participants Estimated Glucose Testing Costs Institutions 413 28 268 2.1 3.1 4.8 4.21 6.36 1.2 Cost per Test, $.74 1.1 1.71.16.. Table 8. Personnel Performing Testing* Primary Tester, % Secondary Tester, % Clinical laboratory personnel n 43 n 31 Licensed medical technician Technician atory assistant Other 89.2 8.3 1.4 1.1 13.3 71.1.9 1.7 High-volume BGT sites personnel n 42 n 341 Registered nurse Licensed practical nurse Nursing aide/assistant atory personnel Other 68.6 9.2 1.7 4.3 2.6 26.1 1.6 16.4 2.3 3. Low-volume BGT sites personnel n 4 n 273 Registered nurse Licensed practical nurse Nursing aide/assistant atory personnel Other 84.4 4. 6.6 1.3 2.2 37. 9. 1. 1.8. accounting categories for either central laboratory testing or BGT, thereby resulting in widely discrepant glucose testing costs. For example, one of the first studies to be published found central laboratory glucose testing markedly more costly than BGT, because the author excluded labor costs for BGT, but not for the central laboratory. This assumption was based on his erroneous belief that nurses were available to perform BGT, and he did not need to attribute costs to this testing time. 1 We designed our study to evaluate only the analytical costs of glucose testing, thereby excluding costs for specimen collection, transport, result reporting, or the indirect costs associated with space, as we believed these costs were either equivalent, inconsequential, or too indeterminate to include. In this way, this study could serve as a model for how future glucose testing costs could be determined more easily, and at the same time also allowed collection of more detailed information about labor costs, the major cost of glucose testing. Part of the basis for these assumptions was that at the time these earlier studies were conducted, it might have been appropriate to include these costs for laboratory testing only. Since that time, however, practices have changed so these costs are equivalent for both central laboratory and BGT. Two of the first studies found result-reporting costs for the central laboratory in the range of $.37 to $.79, but these authors did not assign any cost to result reporting for BGT, perhaps because a large percentage of BGT results at that time were not even recorded in the patients medical records. 3,6 Bedside glucose testing result-reporting software now is used widely, thereby ascribing computerized result-reporting costs to all sites. We also chose to exclude phlebotomy and transportation costs, despite others who found these central laboratory glucose costs of $.8 to 1.28. 4,,8 We,aswell as others, used the CAP Workload Recording System to support this decision, as timed studies allocated 4 minutes for both venipuncture or capillary puncture. 6 Although phlebotomists performing venipuncture usually are lower paid than nurses performing capillary puncture, this difference is offset almost entirely by the cost ($/specimen) of a pneumatic tube system for specimen transport to a clinical laboratory. In another study, the authors had added 3% ($.48) in overhead to laboratory costs only, 8 despite recommendations of others that this cost was the same for central laboratory or BGT. 3,6 If phlebotomy, specimen transportation, result reporting, and indirect cost for space noted in these earlier studies were added to our analytical costs, between $1.7 and $2.8 more would need to be attributed to our costs, irrespective of the site, assuming that there was no inflation in costs between the time these studies were performed. These total costs are seen in Table 2, where we have added phlebotomy, specimen transportation, reporting, and indirect costs for space to the analytical costs we found for those at the and percentile for all 3 testing sites we studied. Accepting and using others assumptions and costs introduces many minor flaws. For example, indirect costs were calculated in the literature as 3% of the direct costs, and then added to give total costs for central laboratory glucose testing. 8 A rigorous determination of these costs would attribute higher direct costs for BGT, which also would be highly variable and indirectly dependent on volume. For the sake of simplicity, we added the cost of central laboratory glucose overhead ($.48) to BGT values. We found the median cost per test for central laboratory, high-volume, and low-volume BGT sites was $1.18, $1.96, and $4.66, respectively. Our median central laboratory glucose costs are similar to some values reported in the literature ($1.7, $1.22, and $1.8), 2,,6 but considerably lower than what others have reported ($3.19, $3.3, and $3.84). 3,4,8 When specimen collection costs, transport costs, and result-reporting costs were excluded from the central laboratory glucose testing costs of these latter 3 studies, their central laboratory costs approximated the costs we found. Our data substantiate the findings of others that there are significant differences in costs between high-volume and low-volume BGT sites. 8 However, in a study by Lee- Lewandrowski and colleagues, 8 the range of BGT costs was higher ($3.8 $48.16) than the range of our BGT costs ($.77 $27.4). In addition, a number of studies reported Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones 743

considerably higher BGT costs ($6.62 $14.39) than the median costs we found. 3,4,6,7 Like others who found labor costs of 47.% to 8.2% of total costs, 3 8 we found that the major percentage of costs of glucose testing were labor costs: 9.3% for central laboratories, 72.7% for high-volume, and 8.8% for low-volume BGT. We also found there were no associated equipment costs for BGT in most institutions, as it is common practice for vendors to provide BGT instruments and service without charge, but to use reagent costs to recoup associated equipment costs. However, unlike others who attributed analytical labor costs only to medical technologists for the central laboratory and registered nurses for BGT, 4,6,8 we found that our participants used laboratory technicians and practical nurses to perform about the same number of glucose tests as their higher salaried colleagues, thereby lowering labor costs of both central laboratory testing and BGT substantially. Median salaries of central laboratory personnel approximated salaries reported in a recent survey. 11 One of the findings from our low-volume BGT sites was that in the majority of these sites more measurements were made on QC samples than on patient specimens. Another of the major expenses of low-volume BGT is that a large number of nurses may be trained to perform a rare BGT measurement. In their worse-case scenario, Lee- Lewandrowski et al 8 reported that 42 nurses were trained to perform testing on 1 of their nursing units, but no patient testing was performed! These authors suggested that for nursing units with low volumes, BGT should be discontinued, combined with other nursing units, or testing should be performed by phlebotomists. We concur with these suggestions and recommend that institutions evaluate their costs and decide if they can afford BGT at such low-volume sites. In Greendyke s 1991 study, 3, oversight by clinical laboratory staff was the major cost associated with BGT, and it approximated the cost of providing the test from the central laboratory test. Since that time, institutional responsibilities within organizations have been defined, and guidelines for implementation and monitoring have been developed. 12,13 Improved testing by nursing and other near-patient personnel has occurred, in part because regulatory groups have made these practices the focus of major quality initiatives. 14 These focused regulatory actions have resulted in increased compliance of nursing staff with required QC activities, such that in most hospitals today, these instruments cannot be used without the performance of QC. Consequently, improved QC procedures have required more QC testing, indirectly resulting in increased labor and reagent costs. One of the major changes in BGT reflectance instruments has been the decrease in testing times from 3, 4, or minutes, as occurred in previous studies, 3 6,8 to 1 to 4 seconds, as required currently. 1 When our study was conducted, it was likely that a number of participants still used equipment that required the longer measuring times. If this study were repeated in a number of years, we would predict that labor costs for BGT would even be lower, not only because of the widespread acceptance of analyzers that make the measurement faster, but also from potential changes in regulations requiring less quality assurance testing. During the first 2 years, instrument manufacturers, laboratory and nursing personnel, and other hospital personnel have made major efforts to reduce the cost of BGT. However, a consensus group has recommended that medical errors of BGT can be reduced with increased security, better validation, improved performance studies, emergency systems, instrument safeguards, and connectivity. 16 These recommendations appear to increase the cost of BGT by requiring additional labor for test development, extensive software modifications and additions, and improved instrument features. The costs of central laboratory testing have been reported to always be much less than the costs of distributed testing, such as BGT performed at many sites in an institution. 17,18 As we considered the vast changes in the practices and impact on costs of BGT, we noted that the laboratory oversight is now minimal, less highly skilled employees perform much of the testing, and measurement times and QC frequency has decreased, thereby lowering the cost of testing. Bedside glucose testing instruments now have elaborate software so that proper QC practices can occur, now are interfaced to information systems, and have been redesigned for easy handling, yet the cost of these units as well as of BGT usually has not increased. A 1994 study found that at 7 BGT sites, costs were less than in the central laboratory 8 ; we also found that 81 of our 414 participants had BGT costs that were lower. From our experience, we doubt that a highly efficient central laboratory would have higher glucose testing costs than a high-volume BGT site and suggest that when it does occur, either the central laboratory was not very efficient or there was an error in the calculation of testing costs. This is because even if we assume that all personnel, equipment, and quality assurance costs are equal, reagent costs for POCT will be significantly higher than central laboratory costs. Participants have been unaware of the costs associated with glucose testing, underestimating costs of testing at all locations. In addition, most participants did not consider labor, maintenance, QC materials, and oversight costs in their estimated costs until they were required to use them in this study. These differences in participants estimated costs were similar to cost-accounting reports in the medical literature. 2 8 A recent thoughtful article indicated that payers want laboratorians to prove that tests are cost-effective. 19 The first step in achieving this noble goal for glucose testing is to determine accurately the costs of BGT and competing technologies. One of the main conclusions from this study was the marked variability of costs for all 3 categories of glucose testing. This degree of variability highlights the need for each individual institution to do a detailed evaluation of their individual costs for BGT, and probably for every POCT they perform. Such a study will allow laboratorians to make an informed decision regarding the cost-effectiveness of such testing, as well as to simply understand what the economic impact of the testing is in their environment. Any published study information alone, ours or others, will not be able to determine what is appropriate for a given institution, but will provide information, guidance, and tools for an institution to perform their own evaluation. In conclusion, we present evidence for the following 3 points: (1) that costs of BGT were lower than what others had reported previously; (2) there remains a poor understanding of costs associated with central laboratory testing and BGT; and (3) before improved cost-effectiveness can 744 Arch Pathol Lab Med Vol 128, July 24 Cost of Central atory and Bedside Glucose Testing Howanitz & Jones

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