DALLAS—The hospital represents more than 80 percent of revenue for many radiology practices, yet breakups between practices and hospitals have become increasingly common, shared Patricia Kroken, principal at Healthcare Resource Providers in Albuquerque, N.M., during an educational session at the annual meeting of AHRA on Aug. 14. These breakups may signify the proverbial canary in the coal mine.
To stem the tide and prep for the future, radiology practices need to adopt a service ethic and embrace the hospital as a customer, Kroken stated.
The reasons behind the losses are varied. However, the core of the problem is a failure to implement customer service. Kroken painted the new portrait of the competitive landscape, offering causes behind the escalating number of breakups and strategies to inoculate practices from contract loss.
The (bygone) geography benefit
Exclusive hospital contracts gave radiologists a lot of protection, confirmed Kroken. They were protected by geography and enjoyed support from the medical staff and the referring physician community, which left room for bad behavior on the part of some radiologists.
In the earlier, more sheltered era, radiology practices might have freely protested when hospital-owned practices such as cardiology groups wanted to read their own studies. It wasn’t uncommon for groups to open an imaging center that competed with the hospital, said Kroken.
Fast forward to the post-PACS era. Evolving technology has delivered new options for radiology practices. “Radiologists have become invisible, which is exacerbated by PACS. Younger physicians are less likely to cultivate relationships with physicians,” observed Kroken. In fact, many younger radiologists prioritize maintaining a balance between lifestyle and income.
The competitive landscape also has shifted. Radiologists have managed to maintain income by tapping into technology to read more cases. Many practices have earned steady income while outsourcing calls, which sets them in the potentially dangerous position of income envy among physician peers.
Teleradiology, however, is a double-edged sword. “Teleradiology changed the rules for everybody. These companies treat radiology as a business and commodity,” said Kroken. By outsourcing to nighthawk services, radiology groups have introduced the hospital to a new level of service or a replacement practice.
Either option spells a new business model.
What’s more, teleradiology companies have honed the art of competition and service. “They raised the bar for service expectations,” said Kroken, and provide rapid report turn-around, state of the art technology, improved access, subspecialty expertise and user-friendliness.
At the same time, the economic landscape has resulted in a fair degree of pressure on radiology practices. With regular cuts in reimbursement, radiology practices are beginning to request income subsidies from hospitals, which, in turn, more fully appreciate the competitive threat of imaging centers.
Kroken noted that radiology groups have overlooked service and responsiveness and cautioned the audience that radiology practices need to measure up to teleradiology providers.
She offered a host of solutions for practices to bridge the gap between the status quo and new service demands. She defined quality in the hospital setting and provided a long list of suggestions, including prompt dictation, results called for significant findings, consistent participation in quality assurance, courteous treatment of technologists, cooperation with technology initiatives, participation on hospital committees, interfacing with administration beyond budget sessions, adherence with service agreements, attention to administrative provisions in contracts, education of medical staff and participation in quality improvement initiatives, hospital programs, community events, marketing outreach and strategic planning.
She also suggested that practices identify stresses in the hospital/practice relationship, analyze complaints and review service level agreements to determine which areas require focus.
“Radiology groups have to make this shift to survive and thrive as a hospital partner,” Kroken said. In fact, now may be the ideal time as more formal quality measurements and pay for quality initiatives are likely to surface in the not-too-distant future.