2009 Top Trends in Health Imaging & IT

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HIIT070701As an industry that long ago learned to survive and thrive through reimbursement cuts, even the likes of the DRA, health imaging and IT is not recession-proof, but for sure is recovery ready. This month’s 6th annual Top Trends survey results—which come just as economic indicators across the U.S. show that a recovery is underway—indicate that hospitals large and small and imaging centers have weathered the economic storm by a combination of aggressive cost controls, budget cuts, staffing cuts, creating more efficient business processes, improving workflow and productivity, attempts to woo and retain a wider referral base by providing physicians with easy, online access to images and reports as well as a stronger push in marketing and patient and provider relations.

The patterns emerge like this: what is consistent with last year (a lot more than we expected), what has changed dramatically (not as much as we thought) and where do we see subtle changes (all over the place, especially staffing, choices in imaging system purchases). Respondents who work for an excellent cross-section of largely U.S.-based healthcare facilities, tell us technology is a differentiator and for sure a clear priority as spending for IT infrastructure, clinical information systems and imaging systems has remained strong, even among facilities reporting flat and declining revenue. Survey results project that spending on imaging systems, IT infrastructure and clinical IT systems will increase as we roll into 2010.

Across the survey base of 410 clinical, administrative and IT professionals, the top business concerns are just what we expected: decreases in reimbursement, improving patient satisfaction and improving productivity and workflow, creating new revenue sources and government regulation and compliance. To see how your facility is faring compared with your peer group, we’ve broken this and other key categories based on five provider types.

Top 5 Business Concerns

  1. Decrease in reimbursement
  2. Improving patient satisfaction
  3. Improving productivity and workflow
  4. Creating new revenue sources
  5. Government regulation and compliance

Top 5 Purchased IT Infrastructure

  1. PCs/desktops/mobile computers
  2. EMR
  3. Data storage/data center
  4. Disaster recovery/business continuity
  5. CPOE

Top 5 Purchased Clinical IT Systems

  1. Speech recognition software
  2. RIS
  3. HIS
  4. Cardiology PACS
  5. Clinical decision support

Top 5 Purchased Imaging Systems

  1. Ultrasound
  2. MRI
  3. Cardiac Cath Lab
  4. CT
  5. CR

Who’s making money

Revenue or lack thereof has been the big story this year. Decreases in revenue were most often reported by multi-hospital organizations/IDNs (35 percent), followed by community hospitals (27 percent) and imaging centers (14 percent). But imaging providers are holding strong. Across the survey base, 36 percent saw an increase in revenue in 2009 over 2008—however revenue growth was conservative, less than 15 percent for 95 percent of that group. Why the increase? Facilities are implementing operational efficiencies, more efficient charge capture and billing, adding technology that increased revenue and seeing a bump in referrals. Facilities are trying hard to make it work.

There’s an even split between facilities reporting a drop in revenue and those where revenues were flat—at 32 percent each. So how bad is it? Not that bad. Of the 32 percent of facilities with revenue declines, 34 percent saw a decrease of less than 5 percent—and 87 percent saw revenue decreases less than 20 percent. Not surprisingly, declines are blamed on cuts in reimbursement, an increase in uncompensated care, more bad debt and reduced value of stocks and investments.

Another big question in everyone’s minds is how does 2009 compare with 2008? Last year’s survey showed revenues had increased at 46 percent of respondent facilities, and were flat at 31 percent; about 23 percent of the survey base reported a drop in revenue. Facilities reporting an increase in revenue most often saw a bump of 5 to 10 percent (44 percent) or less than 5 percent (29 percent). Declines were in the single digits too, most often less than 10 percent (64 percent).

Getting a leg up

Competition today is coming most often from multi-hospital organizations and imaging centers, as well as physician group practices and community hospitals. While 41 percent of the survey base hasn’t changed their operating hours, about a quarter are extending hours during the week and another 20 percent see the need to extend weekend hours to accommodate patients. There’s a big push on increasing and maintaining referrals by improving report turnaround time (42 percent) and adding or providing remote access to clinical images and information (40 percent). Women’s health is the clinical service most often being added to an imaging facility in 2009, followed by cardiology and outpatient imaging.

To boost business, marketing is doing its share, too, by sending out reps to meet with physicians (30 percent) and forming partnerships with physician groups (28 percent). Marketing programs are focused on increasing visibility on the web via websites and via online ads as well as magazine and newspaper ads.

Staffing

Recession-driven job cuts across the U.S. have had a large impact on healthcare, too. While a little more than half of the survey base reports no changes in 2009 in FTEs and outsourced and temporary staff, about a third have decreased their number of employees since last year. Some staffing gains, however, were seen in FTEs by 19 percent of the survey base and temporary staff by 17 percent.

A year ago, 41 percent of respondents to the 2008 survey expected to be hiring FTEs over the next year, while half didn’t expect staffing changes. Only 9 percent expected a decrease in FTEs. Truth proved to be different than projection.

For 2010, respondents are optimistic that hiring will resume and even increase, namely in FTEs (27 percent of respondents). The jobs that are projected to be added are physicians, nurses, technologists, clerks and technical/IT. HIIT070701-B

Imaging systems

When it comes to imaging system and IT purchases, the economic downturn has many healthcare organizations proceeding cautiously, assessing and implementing cost-cutting in all areas possible. But truth be told, imaging facilities are still spending on new equipment. Despite the very difficult economy, about half of the facilities surveyed had no change in their imaging systems spending (vs. 39 percent in 2008)—and 35 percent saw an increase in purchases over 2008 (a year ago, 52 percent of respondents reported a budget increase). Why the spending increase this year? Respondents cite a need to update and renovate existing facilities, followed closely by an overall facility or health system budget increase and a need to improve their competitive advantage via new imaging systems. Of the 19 percent of facilities and departments that saw an imaging systems budget decline, most say they were forced to cut spending because of overall budget cuts across their facility or health system. Last year, only 8 percent reported a decrease in imaging systems spending.

Ultrasound for the second straight year is the most-purchased imaging system, followed by MRI, cardiac catheterization lab, CT and CR. This year, we’ve seen a transition away from CT (No. 2 in 2008 and 2007 and No. 1 in 2006) and mammography systems, especially FFDM (No. 1 in 2007 and No. 3 in 2008), to lower-priced, multipurpose ultrasound systems. (See the chart on opposite page for year-to-year buying patterns.) The applications needs for ultrasound systems are diverse, with vascular applications leading the way but followed closely by echocardiography, 3D and 4D and ob/gyn applications. Portability is a priority as well.

In MRI, 1.5T still reigns as the top choice at about half of the respondent's facilities, but 3T is gaining ground (37 percent). Breast imaging is the area of most new clinical interest in MRI (24 percent), as well as neurology and orthopedics. When in the market for CT, 64 slice systems are still the most popular (37 percent), followed by dual source (20 percent) and 16 slice (17 percent). Radiology is still the department purchasing the most CT scanners (42 percent); emergency and outpatient departments are next in line.

IT infrastructure spending

Like with imaging systems, spending patterns show that acquiring and upgrading IT infrastructure is a priority. Despite cuts to myriad other areas, IT infrastructure budgets remained unchanged at 42 percent of the survey base (vs. 31 percent in 2008’s survey), while 27 percent report increases in IT spending. Increases were fueled by a need to upgrade IT infrastructure, a desire to leapfrog to the next generation of technology and increasing data storage needs. About 20 percent of respondents report a cut in IT infrastructure spending this year vs. 9 percent in the 2008 survey.

This year, PCs/desktops/mobile computers are the most-needed items as computing increases at the point of care and EMR installations begin to edge up. EMRs, not surprisingly, ranked No. 2, followed by two related categories data storage/data center and disaster recovery/business continuity and then CPOE. Some 43 percent of respondents already have an EMR in place.

In comparison to 2008, 2009 has seen a predicted dip in spending. Last year, 60 percent of respondents reported increased spending (in the range of 5 to 15 percent) vs. 27 percent in 2009.

Taking a look ahead to next year, optimism reigns. For 2010, 46 percent of the survey base is expecting an increase in IT infrastructure spending, with 27 percent projecting an increase of 5 to 15 percent. Some 40 percent expect their IT infrastructure budget will hold steady at 2009 levels. Only 13 percent of respondents expect IT spending to decrease, with most in the range of 5 to 15 percent.

Clinical IT spending

Clinical IT systems budgets held steady at the majority of respondent’s facilities (53 percent vs. 41 percent in 2008’s survey), while 37 percent saw increases in IT spending (about 22 percent report it’s under 15 percent). Budget increases were fueled by a need to upgrade IT infrastructure, improve productivity and a desire to leapfrog to the next generation of technology. Some 10 percent of facilities cut IT spending this year, with 8 percent of those saying cuts were under 10 percent. In 2008, clinical IT budgets were cut at 3 percent of facilities. An overall budget decrease was the reason most often cited for this year’s clinical IT budget cuts.

This year's leading clinical IT purchase is speech recognition software, radiology information system, hospital information system, cardiology PACS and clinical decision support.
Looking toward next year, 48 percent of respondents expect their clinical IT budget to remain unchanged—while 44 percent are predicting an increase in spending. Spending won’t likely surge, but it will nudge up 5 to 10 percent, a quarter of readers say. About 9 percent of the survey base expects a decrease in clinical IT spending, with 5 percent of those predicting cuts in the range of 5 to 10 percent.

Slicing and dicing a bit more

To gain as much insight as possible, we sliced the data a variety of ways. Similar patterns emerged among the top business concerns across facilities where revenue increased, decreased and remained flat—with decreases in reimbursement, improving patient satisfaction and improving productivity and workflow remained the top priorities. From our review of the data, it was staffing cuts that absorbed much of the economy’s punch. Bigger changes came in staffing cuts at facilities where revenues declined, with 65 percent of respondents saying they cut FTEs. Outsourced and contracted staff was cut by about 52 percent of facilities, while temporary staff was reduced by 47 percent. But even healthcare organizations that saw revenues increase or stay the same had to cut FTEs (according to 17 to 18 percent of respondents). About 19 to 27 percent of this group also dealt with cuts to outsourced and temp staff.

When it comes to budgets for IT infrastructure, clinical IT systems and imaging system budgets, we found some surprises—and, again, great optimism. Technology budgets seem to be insulated from the economic frailty of many facilities. For example, in facilities that reported overall negative revenue, we find that 34 percent had an increase in their IT infrastructure budget—with many of them in the 10 to 25 percent range. A third of the sites reporting negative revenue had no change to their IT infrastructure budget. Of the one-third of facilities that did see this budget decrease, the majority saw cuts of less than 15 percent. For clinical IT systems, 53 percent of the survey base reports no change to the budget, while 28 percent saw an increase (most under 15 percent). Only 19 percent had a reduction in clinical IT spending. When it comes to imaging systems, in spite of declining revenue, 32 percent report an increase in spending (even upwards of 10 to 20 percent). Only 24 percent saw a decrease in spending, while 44 percent saw budgets unchanged.

Similarly, among the facilities with neutral revenues, 28 percent report an increased IT infrastructure budget (of about 15 percent). But most (55 percent) of this group saw budgets remain the same as 2008. Some 17 percent saw a decrease, which varied greatly from 5 to 25 percent. For clinical IT systems, 67 percent of revenue-neutral sites had no change in the budget. Some 25 percent saw an increase in their budget—up to 20 percent, and only 8 percent had a reduction in clinical IT system spending. Spending for clinical imaging systems stayed the same or increased for 82 percent of the survey base. Some 28 percent saw an increase up to 20 to 25 percent, while 56 percent stayed the same. Only 16 percent saw budget decreases, most often into the low teens.

In facilities reporting positive revenue growth, 52 percent had an increase in their IT infrastructure budget of up to 30+ percent. Some 39 percent of this group had no change to the budget, and only 9 percent saw a decrease to the budget (of about 10 percent). For clinical information systems, 50 percent saw budget increases—well into the 20 to 30 percent range. About 41 percent of respondents had no change to their budget, and only 9 percent saw a budget reduction. Imaging systems spending was on par at 84 percent of facilities that saw no change or increases in spending—with an even split between the two groups. Only 15 percent of this group saw a budget decrease for imaging systems.

Healthcare reform across America looms large on the minds of all of us in healthcare—both as providers and recipients of care. Change is certain, it’s just a matter of when and to what degree. Right now we are coming out of the economic recession, a period in which healthcare facilities have taken a pause to review internal wants, needs and processes to begin to adapt to new market and economic demands. Healthcare facilities will need to share images and reports, often within the EMR, throughout the enterprise as well as externally through health information exchanges. Clinicians, providers and, ultimately, patients need to collaborate on a personal health record for the patient. Technology will be the enabler to level the field of information access, allowing leaders to emerge to further differentiate on how they use the information.

Survey at a Glance

In all, 410 clinical, administrative and IT professionals participated in the Top Trends in Health Imaging & IT survey between July 11th and August 14th. Participation was solicited of the online readership of Health Imaging & IT, our daily newsletter Health Imaging News, as well as by the American Healthcare Radiology Administrators (AHRA) of its members. All data were submitted online and analyzed by Health Imaging & IT. Respondents most often came from the U.S. (94 percent), including 47 states.

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