Auckland, Sept 15 NZPA - Health bosses are confident the crisis over Auckland's medical laboratory services will be resolved and the new Australian-based contractor will keep its job.

The three boards, Auckland, Waitemata and Counties-Manukau, were to give more details later today about the crisis which saw seven top board troubleshooters move into Labtests to sort out safety worries.

Labtests won an eight-year, $560 million dollar contract ahead of Diagnostic Medlabs Limited (DML) to take and test blood and other samples from patients around the Auckland area. The lab deals with 10,000 patients a day and does 30,000 tests a day.

The awarding of the contract began a bitter fight which was resolved in court in Labtests' favour but which also cost millions of dollars in legal and other fees and which led to DML dumping more than 100 staff because it had no work for them.

The district health boards were expected to give further details today explaining why they had sent in the seven troubleshooters but NZPA understands the DHBs were determined the issues would be resolved and that DML would not get the contract back.

The DHBs were unhappy some clinicians and doctors had had trouble getting quick results for their patients and there were communication issues between Labtests and doctors.

Yesterday Labtests apologised for its failings and replaced the Auckland chief executive, Ulf Lindskog, with Paul Waterson, the chief operating officer for pathology at Healthscope, the Australian owner of Labtests.

It admitted it failed in some aspects by concentrating too heavily on the physical establishment of the laboratory in Mt Wellington and the collection rooms scattered around Auckland.

It is believed the health boards were not unhappy with the tests and the way they were done and that their concerns were mainly with the failure of Labtests to communicate with doctors and clinicians.

"We do have to get the clinical community on board," said a source within the DHBs.

DML head Dr Arthur Morris said DML would survive on other work but had shed more than 25 percent of its staff -- about 115 people.

He said it was "very difficult" to see Labtests losing the contract, but intervention by the health boards was necessary.

He said DML had always maintained the resources Labtests had planned to put into the Auckland contract were inadequate.

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