You could see this one coming from a mile away. As soon as you unlink radiologists from their group practices, hospitals, and the capital investments in equipment and physical facilities, you open the door for a more competitive salary environment. Recall that radiologist play little role in digital image acquisition with the occasional exception of ultrasonography. Their common professional role is to sit in dark rooms and interpret images. This can be done anywhere in the world.
The success of teleradiology (see my previous notes on Nighthawk) has now made it possible for hospital executives to place radiologist services up for bid and contract with the lowest bidder in any city. A recent note comments on this new business model (see: Let the commoditization of medicine begin). Below is an excerpt from the article with boldface emphasis mine.
Nighthawk teleradiology services, which allow offsite physicians to read x-rays at odd hours, have been a boon to hospital emergency rooms and radiology groups. Most of the business involves reading CT scans from patients who come into hospital ERs at night....With the advent of teleradiology, radiologists have begun to see the writing on the wall. Privately, many admit that the days of easy money may be competed away....Now along comes Telerays, whose tagline is “Cut costs one bid at a time.” Prior to posting a project on the Web site, a hospital or imaging center registers with Telerays and has preapproved radiologists ...participate in the auction. The hospital or imaging center decides the length of the auction and sets a ceiling on the price it is willing to pay. Preapproved radiologists bid on the project, and the lowest bid wins. If the lowest bid is duplicated by another radiologist, the first of the duplicate low bid gets the contract....Unlike in some other auction communities, including eBay, the entire focus is on price, which is the very essence of a commodity.
David Williams of the Health Business Blog provides a podcast interview of Dr. Daniel Roubein, the CEO of Telerays (see: Podcast interview with Dr. Daniel Roubein, CEO of Telerays). Here is a brief summary of the podcast by Williams:
I spoke today with Dr. Daniel Roubein, CEO of Telerays. He laid out the concept behind the company and walked me through the bid process. We talked about the impact of Telerays on radiologist incomes and work practices, and on hospital and imaging center operations. We discussed Telerays’ policy of performing only final (rather than preliminary) reads. I also asked him about the eventual inclusion of overseas radiologists and the applicability of the Telerays model to other specialties.
Along these same lines of sponsoring auctions for radiologist services, here's another reference to the establishment of an "Ebay radiologist auction" in the EU (see: EU creates Ebay for radiologists). Below is an excerpt from this article:
Obviously, events relating to this new radiology business model are moving quickly. Nighthawk established the successful precedent for these auctions by building a reliable global teleradiology network and solving the accreditation issues. Such a network does not exist at the present time for surgical pathology because of the lack of wide adoption of digital pathology services. I plan to return to this same topic for additional discussion in upcoming weeks as events unfold.
Of course, I'm sure you realize that this is the best argument against moving to digital pathology.
Posted by: Ajit Alles | October 28, 2008 at 12:08 PM