commodity vs. consultant

[zzz1]

---

Members don't see this ad.

I read an interesting article about teleradiology firms today. Here is the link to the article:

http://www.imagingeconomics.com/library/200502-02.asp


It seems conceivable that local competition from US teleradiology companies could be an even more serious threat to the current model of private rad practice than foreign outsourcing ever will. The article says that telerad companies have started to do daytime read as well as the nighthawk work, though they are still respectful of the local radiologist's turf. But what about in the future? What's to prevent them, outfits that employ a bunch of us-trained radiologists in California (TDS), Minneapolis (V?A), Sydney, Zurich (Nighthawkrad) or whereever, from taking away the bread and butter business of daytime reads from local us rad groups, if they are also US rads doing the reads?

It's hard to compete with technology and economy of scale, and I don't see what's to prevent such a scenario from materializing down the road. commodization of rad reading services?

 

[eddieberetta]

Everything is a commodity including physician services nothing new in that. But there is no economy of scale. Why would a big group of radiologists charge less than an individual radiologist? Just the opposite -- big non-physician owned groups need to make a profit to pay shareholders, need to pay overhead for managers, IT execs, helpdesks etc., and need to install all kinds of teleradiolgy linkups. Where is that money coming from? Either they charge more, or they pay their radiologists less... and why would their radiologists accept that?

I think "for-profit" non-physician owned telerads groups are going to have a big problem making money while still paying competitive salaries needed to attract radiologists. OTOH, I think physician - owned groups have a bright future. If the philosophy is to charge a fair market value for reads that are paid to the individual partner, then the group can be successful. But a group of radiologists cannot carry a big corporation with lots of non-revenue generating staff.

Teleradiology does however mean that in the near future, we may be able to ensure that all scans are read by subspecialty imagers, even those done in underserviced areas. It may also mean that we can provide 24 h service by having a small group of radioloigsts work a night shift to provide service to an entire region overnight.

 

[f_w]

I allways thought that big corporate groups are not a threat until I heard about the australian radiology market. Over the past 10 years, the majority of the private practice market has been gobbled up by a small group of 2-3 nationwide firms. While there are some forces in the US medical system that act against such a centralization (mainly the highly fragmented insurance market and the presence of 50 idling medical boards insteat of 8 in AU), I don't see a reason why something similar can't happen in the US. Look at emergency medicine in the US. While there are still local EM groups, many hospitals get their EM coverage through large corporate groups. The presence of these corps already limits the choice of positions available for graduating EM residents. And once the option of the classic private practice EM or radiology group becomes scarce, people are forced to accept whatever crappy deal the corporate groups offer. So yes, I do think that the 'commodization' of radiology services is a real threat. But it will only be a threat if we don't make our 'added value' apparent to our referring colleagues and if we continue to act like Divas e.g. by flaunting our incomes on internet bulletin boards....

 

[bigfrank]

But it will only be a threat if we don't make our 'added value' apparent to our referring colleagues and if we continue to act like Divas e.g. by flaunting our incomes on internet bulletin boards....

I think you have an inappropriately heightened sense of your allure/power on these boards.....

 

[zzz1]

I allways thought that big corporate groups are not a threat until I heard about the australian radiology market. Over the past 10 years, the majority of the private practice market has been gobbled up by a small group of 2-3 nationwide firms. While there are some forces in the US medical system that act against such a centralization (mainly the highly fragmented insurance market and the presence of 50 idling medical boards insteat of 8 in AU), I don't see a reason why something similar can't happen in the US. Look at emergency medicine in the US. While there are still local EM groups, many hospitals get their EM coverage through large corporate groups. The presence of these corps already limits the choice of positions available for graduating EM residents. And once the option of the classic private practice EM or radiology group becomes scarce, people are forced to accept whatever crappy deal the corporate groups offer. So yes, I do think that the 'commodization' of radiology services is a real threat. But it will only be a threat if we don't make our 'added value' apparent to our referring colleagues and if we continue to act like Divas e.g. by flaunting our incomes on internet bulletin boards....

This does remind me of what I saw with ER docs at a local hospital, the admin contracts with comphealth and thus avoids having to hire them directly, the reason, money savings.

ER docs at least have to be on site. I wonder with rad if things will be even worse where they just contract telerad instead of hiring rads through a corporation. I wonder if the Australian replacement is one of telerads replacing local rads or just rads having to join a corporation but stays where they are. The two scenarios would be quite different.

I do wonder also if American rads will be able to stop some potential trends like the Australian situation. working for a corporation would be no better than being in outside of medicine jsut like every other average joe.

 

[f_w]

The aussie scenario was to my knowledge one of the big corps buying out local groups one by one. The senior partners took the money, stayed their 5 year stipulated length of contract and then retired on the cash. I don't think telerad was a big factor in this process. (The rads now coming into the market have a choice of low-paying jobs in the public hospital sector or employee positions with the private corps).