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Imaging Center Owner Resources: Outpatient imaging center owners have a lot of challenges these days.
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The Outpatient Imaging Center “Blueprint for Success” The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Keynote: Tommy Thompson When asked the root cause of the DRA legislation: “Well, it’s a lack of regulations, lack of money, but they really are mutually intertwined, and CMS is driven by dollars. And that’s why you have this [DRA] legislation in right now that we … got a good chance of delaying for two years. But it doesn’t go to the heart of the matter … we have to have a complete transformation of healthcare in America, and that is what needs to be done. There needs to be ways in which we change the reimbursement based upon quality.” When asked what actions imaging center leaders should take to combat the DRA: “You’ve got some wonderful new things that are happening in your hospital and your clinics. And the truth of the matter is, is the legislators and congressmen and women really don’t understand it. They don’t understand the reimbursement formulas. They don’t understand the new medicines. They don’t understand how you treat patients. They don’t understand the cost. All they know is when they get back here to Washington, they’re budgets are large. And what you need to do is you need to bring in your state legislator, because they can have an impact. You need to bring in your congressman and/or woman and U.S. Senator and be able to sit down and say, you know, “This is how we treat patients, and this is the new kinds of treatment we have. And this is what we need. And the reimbursement formulas that you are putting upon us are causing us problems.” And have examples there. Have some patients there to talk to, and I’ll tell you, it’ll be the best amount of time you’ve spent in your year. It’ll even be better spent than going to Washington or to the state capitol, is to get that congressman. But the problem is there, everybody’s busy and they’ll send an aide. An aide doesn’t count. You gotta have that individual in your office, in your clinic to see what’s going on.” Tommy Thompson Former Secretary of the Department of Health & Human Services 3 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Keynote Speaker: Tom Scully Medicare’s focus on imaging due to volume growth of 20% year after year and spending increase of 25% annually Congress needed to find an area to offset physician fee structure and imaging was “one of the biggest lines on the bar chart” Anticipate a similar “instant replay again this year” where Congress is “going to come back after the election and fix the doc cut. The docs are teed-up again for a negative 4.7 percent update.” Imaging, like other high growth areas of healthcare, needs adjusting and whether DRA goes into effect January 1, 2007 or there is a 2 year moratorium, changes will occur Recommend grassroots movement to make noise with Congressmen and Senators. Don’t focus on blame with industry organizations or other providers, but band together to put pressure on legislators, otherwise the chance is great that the DRA will take effect the first of the year “Show the savings to the system. Hospitalization is down. A lot of people aren’t going to the hospital because they’re getting PET scans or CT scans or MRIs or other imaging services that are saving money. A lot of interventional radiology services that are in the hospital are much more cost effective, result in much shorter hospital stays. So spending money in Part B on imaging is not necessarily a bad thing if the net costs to the system go down. Do most members of Congress understand that? No. Will they – is it a good argument that they need to be educated on it in the next three or four months? Yes. “ Tom Scully recently accepted a leadership position with the Access to Medical Imaging Coalition (www.imagingaccess.org). Tom Scully Former Administrator of CMS 4 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 General Session: Sg2 Key Takeaways • Imaging is growing and the market is shifting • Success will require better strategies, clinical performance, productivity and business execution. And do all the basics well. Predictions post-DRA • Market consolidation will occur – Hospitals may purchase struggling outpatient imaging centers – More successful imaging centers and radiology groups will acquire other imaging centers and select physician- owned services – Non-radiologists now providing in-office imaging services may close those down and seek privileges to interpret in the hospital – Marginally profitable and single-modality centers may struggle • More joint ventures among hospitals, specialists/radiologists and imaging centers • Safety in strategic service JVs with specialists • Diversification of services and JV’s by imaging centers (e.g. cancer Dx/Tx centers) • Low-reimbursement studies currently being performed in an outpatient or IDTF setting will move to the hospital in large numbers • Equipment purchases and upgrades will slow down, increase in “used” equipment purchases • Increase in competition for volume and pressure from payers Michael Silver, PhD Vice President, Sg2 5 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Breakout: Marketing Marketing is a core strategy for your growth and success – strengthening it can be an anti-DRA strategy Tell your story before your competitors do Marketing is an economic investment, not a frivolous expense Marketing is different than sales – sales being your “feet on the street” meeting with referring physicians Marketing outcomes can be measured against the investment Marketing is a profession hire the best don’t try to do it yourself Competition is only going to increase so be prepared for a battle How will market leaders respond to DRA? • Develop a renewed emphasis on service • Protect your referral base • Look for opportunities to increase your market share • Grow your business by expanding your marketing program • Emerge as a strengthened organization Curtis Pickelle CEO, Imaging Center Institute 6 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Breakout: Finance GE and industry data indicates robust growth (9% average annual growth rate) in imaging procedures within OIC “sweet spot” (MR, CT, PET) Best practice sharing model for DRA impacts upon net revenues MUST be done at procedural levels to show impact upon any particular center. Significant range by mix of procedures. No consensus on private payers yet; need to account for potential decline here for sensitivity analysis in your impact model Six Critical Success Factors (that finance companies look at when evaluating your business) 1. How well do you understand your referral sources and are you effectively marketing to them? 2. Do you have commitment from your reading radiologists (regardless of whether they are owners or on contract)? 3. What are your relationships with local hospitals and do you understand their outpatient strategy? 4. How well do you know your local market and your competition, including unmet market needs and your own competitive differentiators? 5. How effectively are you managing your payer mix and contracts? 6. Is the business striving for continuous process improvement, especially as it pertains to financial and operational areas? Jim Sadowski Vice President, GEHC Financial Services Doug Lynch Sr. Vice President, GE Commercial Finance 7 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Breakout: Operations Access and Service • Reduce call abandonment rate by routing calls appropriately, schedule staff to match call volumes • Reduce No Shows by making reminder calls to patient, develop tight script and train staff, if patient doesn’t show – find out who got the business • Expedite report turnaround, understand customer expectations (and competitor performance), identify and reduce process bottlenecks, implement technology solutions, leverage service excellence as a competitive advantage Capacity and Throughput • Optimize protocols • Prep patient outside exam room, utilize tech aide, optimize exam slots • Cross-train technologists Revenue Cycle – Avoid denials and write-offs • Verify insurance is correct and obtain pre-auth from the referring physician; review benefits to ensure the procedure is covered; check medical necessity • Check outstanding balances and out of pocket payments; contact patients for payment plans prior to visit • Contact the patient or physician to resolve outstanding issues Michael Hase Senior Manager, GEHC Performance Solutions Doug Long Senior Manager, GEHC Performance Solutions 8 / The Outpatient Imaging Center “Blueprint for Success” Conference 08/09/2006 Breakout: Technology Planning Technology planning isn’t just about technology Understand where you are to know where you’re going (strategy) Understand growth – and drivers of growth – by modality Realize modality growth alone is not enough; consider reimbursement, staff skill sets, payer mix and market saturation as well The newest technology is not always the right call The planning process requires discipline, a long-view, and flexibility When planning for technology, consider new equipment, upgrades, moving existing equipment, refurbishments When creating capital investment plan, ask: • Do investments align with our overall strategy? • What operational changes are needed? • Any new clinical or operational opportunities? • How will facilities be impacted? • How do we pay for it? • How do we service and maintain the investment? Garrett Ogden Practice & Marketing Leader GEHC Performance Solutions The Outpatient Imaging Center “Blueprint for Success” Conference Technology: when to inves t Revenue Time Cumula tive Revenue Breakthrough Technology or Application Introduction Market Standard Technology Mature Technology Early Adopter Consensus Adopter Cautious Adopter Late / Defens ive Adopter Medium Volume Low Re imbursement High Volume Max Re imburs ement High Volume De clining Reimburseme nt De clining Volume Low Reimbursement |
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