PACS: A culprit in radiology commoditization?

By Cynthia E. Keen, staff writer

June 9, 2010 -- PACS and teleradiology services have proliferated in hospitals throughout the industrialized world because they can provide rapid, efficient access to images at any time and, in theory, anywhere in the world. But has the adoption of PACS also led to the commoditization of radiology?

This was the subject of the closing session at the Society for Imaging Informatics in Medicine (SIIM) annual meeting held in Minneapolis June 3-6. Session moderator Paul Chang, MD, likened the spectrum of imaging informatics tools to weapons, and radiologists to arms dealers.

Chang, vice chair of informatics and medical director of enterprise imaging at the University of Chicago Hospitals, also challenged SIIM attendees to suggest ideas for reengineering radiology using value-added innovations in imaging informatics.

From contractor to competitor

The adoption of PACS has fostered a still-growing industry offering remote teleradiology interpretation services. Rather than just providing supplementary services to "in-house" hospital-contracted radiologists, teleradiology providers have become competitors, offering lower fees for service and faster report turnaround times.

All this has happened in an era of declining reimbursement. In the U.S., the recently approved healthcare reform legislation will reduce reimbursement to both hospitals and radiologists. Reimbursement is expected to decline by 15% to 30%, according to Chang. To lower expenses, hospitals may end longstanding contracts with local radiology groups, instead hiring radiologists directly or using lower-priced "virtual" radiology services.

For some virtual radiology service companies, growth and financial success are tied to the ability to undermine the longstanding relationships between established local radiologists and the hospitals they serve, Chang said. He quoted an excerpt of an unidentified and undated Wall Street analyst's report about NightHawk Radiology Services of Scottsdale, AZ. The analyst's report suggested that the future growth and financial success of the company was based on severing the loyalty of hospitals to local radiologists. For the record, in May 2010, NightHawk issued a statement that it would not engage in such predatory practices.

But other firms are blatant. Telerays of Bellaire, TX, operates an auction on its website similar to eBay. The site provides a portal in which radiologists can vie to provide the lowest fee to interpret specific radiology exams requested by hospitals.

With a motto to "cut costs one bid at a time," the website encourages hospitals to "bid it out" and "save a bundle." The site also notes: "Post your interpretation requests and let the Telerays radiology auction go to work. ... The result: efficient, quality, economical interpretations of radiologic studies."

"I love the website," Chang said. "This represents radiology commoditization at its best. In one graphic, the only figure of a person who has any physical dimension and color -- red -- is the hospital administrator. He is surrounded by gray, faceless, flattened figures. These are the radiologists. They are nameless and interchangeable. This is the perfect metaphor."

"How do we combat them?" he asked a SIIM panel of radiologists who have established themselves as imaging informatics pioneers and superusers. The problem is that many lay people don't have any opinion or expectations of radiologists. In fact, he said, "most college-educated lay persons don't think that radiologists are physicians," according to a recent survey.

Radiology's best allies

Referring physicians may be radiology's best allies, suggested Steven Horii, MD, professor of radiology and director of medical informatics at the Hospital of the University of Pennsylvania in Philadelphia. At Horii's hospital, referring physicians and surgeons specifically request that studies be read by radiologists they identify by name.

These radiologists have developed "brands" of excellence, Horri said. They answer the clinical questions requested by the ordering physicians and prepare reports valued by the recipients. When asked by a referring physician if a biopsy is warranted, they provide their best recommendation, avoiding such phrases as "clinical correlation is suggested." They also make telephone calls and discuss the medical cases. They are proactive. They engage their clinician customers, he stressed.

Horii suggested that radiology departments and imaging centers ask patients what they want. According to Horri, patients will say what they don't want, which in his big city hospital includes parking garage hassles, high parking fees, and waiting up to 45 minutes for a scheduled exam. To offset this, Horii recommends personal attention by radiologists to patients, while acknowledging that this will be difficult with the increasingly stressful clinical environment and push for productivity.

But right now, when patients get a bill with the name of a doctor they don't know, they may ask, "Who are you?" At the very least, you can assuage concerns about radiation exposure, and your department can promote the fact that it uses the most advanced imaging equipment, with software to reduce CT radiation dose by 10% or more compared to the competition. Informatics can be used to make patients aware that the radiologists of a practice are aware of their needs.

Eliot Siegel, MD, chief of radiology and nuclear medicine at the Veterans Affairs Maryland Health Care System in Baltimore, pointed out that radiologists historically have been faceless and nameless. He recalled the film-based days of his radiology residency, when on-call residents expected to have film pushed under the closed door of the on-call room, to be pushed out into the hall after being read.

"This was the ultimate commodity, a nameless, faceless person behind a door. For all anyone knew, this could have been the janitor," he said. "If all we are is our report, we will become a commodity. But I'd like to suggest that our reports aren't even a commodity. Oncologists at the National Cancer Institute recently told me that in their opinion, a radiology report is an anecdotal story to a piece of art."

Siegel believes that medicine is shifting dramatically, to be more personalized and data-driven.

"Large electronic databases exist and will continue to grow," he said. "How can radiology data be made accessible in a machine-readable way that is also intelligent and structured? How can information provided by expert radiologists be added to the database in searchable format?"

Siegel suggested that if vendors could develop data-mining software that could utilize and apply the expertise of radiologists to other patients, this would greatly add value and differentiate the interpretation services of a group of experts from the rank and file.

Adding value for payors

Horii also said that radiology departments and practices can differentiate themselves by adding value for health insurance companies. When reimbursement claims are 100% accurate and flow through the systems, health insurance companies don't have to spend as much money processing them.

"We use software that is commercially available to guarantee that the information we submit is correct," he said. "They don't have to have a person scrutinize every single CPT code because they know the claim is right. This reduces workload for them."

A member of the SIIM audience pointed out the dilemma that hospitals may find themselves in if a virtual teleradiology provider overlooks an important finding in a radiology exam. This also affects the reputation of the radiology department even if local staff members were not involved. Maintaining a high level of quality assurance, accuracy, and trust is imperative. This can be jeopardized by low-cost interpretations made outside the patient safety cloud of quality control.

Panel member Richard Wiggins, MD, a radiologist at the University of Utah Hospitals and Clinics in Salt Lake City, described being put in a difficult position when his department went filmless. "Our neurosurgeons had procedures done down the road, but then they brought me the film and asked me to read it. I had all the medical-legal risk but our department had none of the revenue."

Wiggins said he turned this around by making himself available to the surgeons and referring physicians -- off hours, on weekends, and while attending conferences like SIIM. He said that turf battles among specialties still cause revenue attrition, citing vascular surgeons who have no experience with radiation doing their own procedures in the radiology department.

Wiggins speculated that value will be a differentiator, when insurance companies develop the savvy to determine if a procedure was done incorrectly and had to be performed again. "Hopefully, they will learn who to pay," he said.

Raymond Geis, MD, a radiologist with Advanced Medical Imaging Consultants of Fort Collins, CO, said that he wasn't going to wait for insurance companies to figure out whom to use and to pay. He's planning to acquire software that will demonstrate the quality of his practice.

"I'm going to show that our diagnosis correlates with pathology, that we perform the best exams, that we have impressive report turnaround times -- and that our reports are valuable to the physicians who request them," he said.

William Keyes, MD, a neuroradiologist with Inland Imaging, a multilocation practice in western Washington state, stressed that involvement with the hospital practice is important. He also suggested that the means by which critical results are reported is an important differentiator.

A suggestion about ranking the expertise of radiologists generated more questions than answers, specifically about the criteria for judgment and who would judge. Also, how would patients -- the ultimate consumer -- understand the criteria? By good graphics on a website, Siegel queried?

There was agreement that a national performance database would enable individual radiologists and their practices to be compared to benchmark standards, but there was concern about potential legal liabilities for a group that did not meet the norm. Several individuals commented that high standards could be used in some way to market services to both practitioners and patients.

There also was discussion about having software that could make it easier to add multimedia material, such as peer review articles or images, to reports.

Finally, the gauntlet was raised to vendors: Create software that will help radiologists enhance the value of the work they do and the reports they write. Imaging informatics can be used to promote differentiation in the same profession it has commoditized.

By Cynthia E. Keen staff writer
June 9, 2010

NightHawk issues policy on 'predatory' teleradiology, May 19, 2010

The Profit Center: Part 13 -- Radiology as factory work? April 13, 2010

Rating system ranks imaging providers, July 29, 2009

PACS: Key to radiologist productivity, practice development, June 22, 2009

Telerays to auction telerad readings to lowest bidder, October 16, 2008

Copyright © 2010


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