The laboratory co-tenancy model is similar to the laundry cooperatives that hospitals created to control costs. Rather than send laundry out to an independent provider, they joined together, becoming the provider themselves. The hospitals acquired a facility, set up operations and devised a mechanism to share the cost. Economies of scale and elimination of independent laundry profit provided cost reduction to the hospital owners. Meanwhile, each institution received an essential service that was needed. Ownership and utilization usually didn’t expand beyond the organizations that formed the cooperative. This limited optimal cost reduction that could be achieved from the additional volume of other organizations.