5 Elements of a New Radiology Model to Manage Hospital Costs, Quality

When hospital leaders think of radiology, they may think of costly subsidies, patient safety hazards and overutilization. Radiology is the third largest and fastest growing spend area in healthcare, according to Hank Schlissberg, chief client officer at the national radiology group Radisphere. In addition, radiology touches nearly every major disease area — from cardiology to oncology to orthopedics and more.

In the current delivery system, these problems are pushed to the forefront because there are few incentives to reduce utilization. By aligning incentives and using a team approach to radiology, however, hospitals can provide high-quality radiology services cost effectively. "It's not about doing things better [within the current system], it's about leveraging scale, technology and incentive alignment," Mr. Schlissberg says. "It's about a structurally different model." Radisphere's model includes a large group of radiologists with different subspecialties who partner with hospitals both onsite and remotely to produce quality outcomes. Below are five key elements of a new radiology delivery model that can drive higher quality and lower costs.

1. Aligned incentives for efficiency, high quality.

One of the fundamental changes to the current radiology delivery system that is needed to improve quality, utilization and costs is the alignment of incentives. In a setting with many radiologists, healthcare leaders can offer financial incentives for achieving appropriate quality, utilization and cost goals, according to Mr. Schlissberg. "Not being a traditional radiology group partnership, we have an opportunity to do creative things to align incentives," he says of Radisphere. For example, if the radiologists drive down utilization, they can share savings.

2. A collaborative culture.

Incentive alignment is part of a collaborative culture needed in a new radiology delivery model. One way to create this culture is to promote physician leadership of the radiology group. "We are empowering the physicians to take ownership of the practice, to be able to control how things are done," says Frank Seidelmann, DO, chief medical officer and chairman of radiology of Radisphere. "We're developing internal collaboration tools so we can educate ourselves, share interesting cases, and collaborate in real time."

For example, Radisphere radiologists in a hospital can consult with other radiologists of a specific subspecialty via telemedicine. "There might only be two or three credentialed radiologists at the hospital, yet you may have the ability to consult with 10 or 20 colleagues in the same subspecialty," Dr. Seidelmann says. In contrast, a traditional radiology practice may have fewer radiologists representing only some subspecialties or who may only have general radiologists.

3. Access to subspecialists.

A radiology delivery system that ensures access to subspecialists has numerous potential benefits, including lower utilization and reduced errors.

Lower utilization
Access to subspecialists can also help reduce unnecessary utilization, which is one of the biggest drivers of cost in radiology. A radiologist reading a study he or she does not specialize in is more likely to order an additional test than if the appropriate subspecialist reads the study, according to Dr. Seidelmann. Ensuring studies are read by the correct subspecialist can thus reduce these additional tests. At Radisphere, a radiologist needs a second radiologist to agree that a follow-up study is necessary before ordering the additional test. This requirement helps keep unnecessary utilization down.

Reduced errors

The documented error rate for radiology is between 4 and 9 percent, according to Mr. Schlissberg. Besides the patient safety consequences, errors can have significant cost effects. For instance, Mr. Schlissberg says an error on a lumbar spine reading may result in an unnecessary and costly back surgery. With value-based reimbursement beginning and bundled payment opportunities growing, it is becoming even more important to reduce errors and ensure high quality and low costs.

Errors in radiology may occur due to a lack of subspecialty expertise. "Radiology has now become so subspecialized that it's impossible for one radiologist to have the scope to read every study with every body part with expertise," Dr. Seidelmann says. In a radiology delivery model that can easily connect radiologists to subspecialists remotely, this source of error is eliminated.

In its recently released Quarterly Performance Scorecard for Q2 2012, Radisphere maintained a 0.7 error rate through its easy access to subspecialists and standard processes. Radiologists follow protocols to get studies to the appropriate subspecialist. For example, an MRI of the head and neck will always be read by a neuroradiologist, and an MRI on the ankle will be read by a musculoskeletal radiologist, according to Dr. Seidelmann. By working with a group of radiologists that represent a wide range of subspecialties, hospitals can ensure more accurate readings.

4. Standard protocols.

A radiology service model that develops clinical and operational standards can improve quality and gain efficiencies, which can translate to lower costs.

Radisphere believes that only a small number of radiology studies account for a large number of errors with a serious pathology. To that end, the organization established a standard protocol in which radiologists are alerted to error-prone studies, which then go through a double read to ensure accuracy.

Another standard is the approach to the peer review process. A new radiology delivery model should have a structure that promotes a just peer review process. In the traditional model, a small group of radiologists may have difficulty identifying others' deficiencies through peer review. "It's very difficult to fire one of your partners," Mr. Schlissberg says. When a large group of radiologists do not depend on each other for their practice, they may be more likely to act on peer review findings.

5. Working with primary care physicians.

Another key aspect of a new radiology delivery system should be a heightened level of communication and collaboration between radiologists and the ordering physician. "Historically, radiologists haven't had an incentive to get involved [with the ordering physician]," Dr. Seidelmann says. "At times there has been push back from physicians on why radiologists are questioning why they're ordering [a certain study].

"The time has come for radiologists to become consultants and colleagues, to work with physicians in reducing the cost to society and reducing unnecessary radiation, as well as making sure the patient gets the right diagnosis at the right time and is treated correctly."

Radiologists should discuss appropriate studies with ordering physicians to help manage utilization and costs and improve quality. For instance, if an imaging test is ordered for a non-emergent patient, the radiologist can take the time to work with the physician at the point of care to determine the study's appropriateness.

Dr. Seidelmann says physicians are becoming more receptive to discussions with radiologists and in some instances seek consultation to ensure the best care for their patients. "They're actually eager for that type of collaboration because they are now keenly aware that they don't want to over-radiate the patient, and they want to lower costs for their patients," he says.

A new model for the future

As healthcare moves to a reimbursement system based on performance and quality rather than productivity, the structure of radiology services must change. To be successful, a new radiology model should have aligned incentives and a collaborative culture to reduce costs, access to subspecialists and standard protocols to improve quality and a collaborative relationship with ordering physicians to reduce inappropriate utilization.

More Articles on Hospital Radiology:

Enterprising Imaging Strategy: What Are You Really Getting in Return?
Medical Specialties Board Recognizes Interventional Radiology as Distinct Specialty

2 Ways PACS Systems Need to Evolve

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