Innovations in diagnostic radiology have led to advances in the field of medicine. Today, MRI, CT and PET scans enable physicians to detect, diagnose and treat medical conditions much sooner and with increased accuracy.
At the same time, an unprecedented growth in the use of diagnostic radiology is now contributing to a high rate of medical inflation. With a 20% annual growth rate, diagnostic radiology is now the fastest rising medical expense, increasing at twice the rate of prescription drugs and overall health care spending.
According to a report by the Association of Health Insurance Plans, almost $100 billion is spent each year on imaging in the U.S. and these costs may double in just four years.
As the newest category of escalating medical costs, diagnostic radiology requires new and innovative management strategies. Just as managed approaches have helped control the costs of prescription drugs and other high-cost medical expenses, diagnostic radiology is now the new frontier for managed care.
Benefit managers and administrators must be aware how the various sites of service impact costs and quality differently:
* Hospitals. Upwards of 80% of imaging exams are performed in an outpatient hospital setting. These services are generally high in quality, but can be expensive.
* Physician offices. Advanced imaging equipment is now relatively easy, although still costly, for general physician offices to purchase or lease. However, recent studies suggest that physician offices may order tests for financial benefit rather than medical necessity. The General Accountability Office recently documented a dramatic increase in the number of physician offices that "self-refer" patients for imaging performed on scanners they own or profit from.
* Imaging centers. Most of the U.S. population has access to one of the thousands of freestanding imaging centers across the country. The challenge is in identifying the facilities that consistently perform quality tests, provide prompt service and deliver accurate test interpretations. With the popularity of consumer-driven health plans, it's often the patients who must pay for a majority of the imaging cost and are responsible for shopping around to locate the best facility.
Most plans experience approximately 200 to 250 scans per 1,000 members per year. With such high utilization, benefit managers and administrators must be aware of today's latest radiology management strategies.
Radiology utilization management and the use of specialty networks are just two strategies you can use to ensure your plan is using the right programs to optimally manage costs, avoid unnecessary utilization and ensure patients receive tests from qualified providers.
Radiology utilization management attempts to control costs by ensuring tests are appropriate for a patient's particular medical condition and in line with an ordering physician's area of medical expertise. Currently, most health plans use some form of utilization management.
Typically, a radiology benefit manager performs a utilization review and charges either a per-member, per-month fee or full capitation rate for radiology review services.
When this program is implemented, benefit plans must require members and ordering physicians to obtain pre-authorization for high-cost radiology procedures. Physicians must contact the RBM before ordering an imaging procedure and receive prior authorization.
To ensure timely and accurate processing of authorizations, an RBM must be fully integrated with a plan's claims system. System integration can be cumbersome, and patients may become confused about benefit changes. Benefit managers must plan for a longer implementation period to account for these complexities.
Generally, these programs are successful when the partnership between the benefit plan and RBM ensures clear communication with physicians requesting tests and strong administrative integration.
Use of specialty networks is a lesser- known, but growing, management strategy. Specialty networks have close partnerships with radiology providers, and therefore, can offer savings of up to 50% to 60% per scan, depending on the geographic region and the type of provider who would have otherwise performed the test.
These networks use several methods to ensure the quality of their contracted providers, which leads to more accurate imaging and interpretations.
A specialty network consists of freestanding imaging centers and reading radiologists, and it also has access to a number of subspecialists, who are available for second reads or specialized image interpretations. The providers must also adhere to national quality guidelines established by associations like the American College of Radiology.
Most specialty networks ensure that a vast majority of their contracted providers are ACR-accredited. This ensures that the physicians who are supervising and interpreting diagnostic imaging tests have met stringent educational and training standards.
Group Administrators partnered with a specialty network in 2008 to achieve savings over and above what was available from their clients' existing PPO contracts.
"The specialty network has helped us achieve 60% savings on advanced radiology services," says David Dorfman, CEO. "During today's difficult economic climate, employer-clients appreciate these savings.
They also have peace of mind knowing the imaging centers have undergone an extensive screening process, and plan members have a concierge service available, which walks them through the scheduling process."
With diagnostic radiology costs rapidly increasing, benefit plans must take the appropriate steps to control quality and costs. Today's management strategies can ensure proper utilization while providing access to high-quality providers. Implementing radiology management strategies is fairly simple and can produce a large return for the plan, administrator and members.
Don Duford is president and chief operating officer of One Call Medical. He can be reached at don_duford@onecallmedical.com.
