Many radiologists prefer an independent practice model for a variety of reasons. Lifestyle and benefits (especially vacation and retirement) are often enhanced in a private practice.
Rebecca Farrington.In the workplace, private practice offers more control over corporate culture along with the ability to structure the practice and its subspecialty focus in a way that best meets its patients' needs. There is better opportunity for management of administrative and clinical time to accomplish research projects, journal articles, and continued professional growth.
However, there are always challenges to maintaining practice independence, including staffing, consolidation, and legislative and environmental pressures.
Staffing
The ability to maintain an adequate staff of physicians is an ongoing challenge. With 8% of the pool of 30,000 radiologists nearing retirement age, and a relatively small supply of new radiologists, the demand for physicians remains high. Open positions continue to outpace the number of available graduates.
The forces of supply and demand are therefore driving salary expectations upward such that the average radiologist's salary has seen an increase of 13.5% over the past year, the second highest specialty in a survey by Merritt Hawkins. Radiology utilization has been increasing along with an aging population, resulting in more work for this diminished workforce.
With remote reading becoming more accepted, teleradiology companies are now an employment competitor to private radiology groups in hiring physicians. Remote work offers flexibility that is unavailable in a traditional practice model.
If the practice decides to implement its own remote work option, plan for IT setup and support. When private practices implement remote work options, IT setup and support add additional cost and complexities to the private practice model.
The difficulty in recruiting new physicians to a traditional practice is reflected in a similar struggle to retain physicians. The high rate of burnout, coupled with a renewed focus on work-life balance, creates additional hiring challenges.
Along with higher salary demands, new radiologists are looking for a better work-life balance. The quality of life outside the workplace means limiting or eliminating on-call responsibilities. Similarly, there is less interest among new physicians in spending time on practice administrative tasks.
Unless there is a succession plan in place, with proper training and integration of younger physicians in practice management, it will be difficult or impossible for a private practice to sustain itself as the senior physicians retire.
Although challenges exist, there are strategies to maintain practice viability and vitality. Scheduling optimization is critical for improving productivity and reducing stress at the physician level. Workflow management is necessary to leverage subspecialty readers while optimizing each and every work slot.
Along with this, scheduling physicians to work in their subspecialty as often as possible will provide them with better job satisfaction. There will always be a need for general radiology coverage. It's important to balance sub-specialized physicians with general radiologists who may enjoy the challenges of reading multiple modalities. A practice that is poised for the future has a healthy mix of both.
Private practice focus on diversity, equity, and inclusion (DEI) has become increasingly important to candidates. Promoting your group's DEI philosophy can be helpful during the recruiting process. The DEI plans must align with the practice's mission, vision, and core values in order to attract a diverse workforce.
Some practices have formed DEI committees to assure that their stated goals are actually supported and implemented. It is not enough to talk about DEI, your practice must demonstrate everyday your commitment to diversity.
Consolidation
The recent trend has shown that fewer practice mergers are taking place, but they tend to be larger in size and scope. According to a study published in the Journal of the American College of Radiology, the number of radiology groups with 100 to 499 members represents 21.8% of all practices, and those with 500 or more members represent 28.7% of practices, both significant increases over previous surveys. In addition, 15% of radiologists work for practice aggregators.
Achieving economies of scale is one of the most common reasons cited for merging, but there are other reasons as well. Any merger or consolidation should be viewed as a strategic move, such as for market share or bargaining power. The motivator for many mergers is an aging physician demographic, especially where the younger members are less interested in practice administration.
By combining with another local group, the practice can continue to be independently owned while benefiting from more resources. Hospital system consolidation can absolutely impact the future of your hospital contract, as well as the future of your group.
It is always good business to have a great relationship with your hospital partners. Hospitals with a strong administrative relationship and more likely to participate in system-wide decisions that will impact their group.
Just as they have impacted the hiring of radiologists, teleradiology firms are impacting the relationships that independent groups have with their hospital. The pandemic has provided them with an opportunity to offer remote services that are now more acceptable to health systems. This can be a threat to the independent practice.
Legislative and environmental pressures
Keeping abreast of the changes that take place in the regulation of medical practice requires constant attention. At least one member of the group should be charged with the responsibility of monitoring sources such as the American College of Radiology (ACR), the Radiology Business Management Association (RBMA), and the Medical Group Management Association (MGMA), as well as blogs from other authoritative sources.
New laws such as the No Surprises Act and the information-blocking rules are impactful to all radiology practices. Having committed group members responsible for staying on top of legislative changes is critical.
Price transparency resulting from these laws is allowing patients to become increasingly aware of the fees they are charged, and more patients will be paying a portion of the cost themselves due to changes in insurance plan structure. The practice must continually monitor its fee structure for self-pay patients to ensure they are in line with market competition.
Keeping track of the Medicare Physician Fee Schedule (MPFS) provisions and payment rates is an annual yet ongoing task. The Medicare fee schedule determines not only what will be paid for Medicare services, but often commercial contracts are tied to the Medicare rates in some way.
The organizations mentioned above allow practices to have an important voice in determining the outcome of proposed Medicare regulation. Environmental changes, such as the advent of artificial intelligence (AI) in radiology practice, can have a significant impact on many areas. AuntMinnie.com has reported that "AI will not replace the radiologist; it can enhance the performance of the radiologist."
Although there is currently little reimbursement for the use of AI, its use can make a radiologist's time more efficient and therefore more profitable.
Conclusion
Staying independent and maintaining a group practice's culture and benefits will take ongoing effort but it is attainable with the right mix of physicians and administrative support. The pressures we have described are constantly evolving, so identifying appropriate sources of information, networking with other groups and hospital partners, and preparing for the next level of leadership will all benefit the future of independent radiology practices.
Rebecca Farrington serves as the chief revenue officer for Healthcare Administrative Partners. She has more than 20 years of experience in healthcare sales and management roles, focusing on hospital-based and physician revenue cycle management.
The comments and observations expressed are those of the author and do not necessarily reflect the opinions of AuntMinnie.com.
