HAP Radiology Billing and Coding Blog

Keeping Your Practice Independent - Build on Existing Relationships

Posted: By Rebecca Farrington on September 12, 2019

Keeping Your Practice Independent - Build on Existing RelationshipsIn our recent article we wrote about The Case for Maintaining an Independent Radiology Practice in the Face of Industry Consolidation.  A radiology practice that has served the community with high quality services over many years naturally has developed relationships that can be drawn upon to strengthen its position, and avoid what might otherwise seem to be the imperative to become absorbed by some larger entity.   Some of those existing relationships include the hospital served by the group, its referring physician community and neighboring radiology practices.

The Hospital

The local radiology practice can be responsive to their hospital system’s needs, whereas a large investor-owned radiology service might not be.  This point should be communicated to the hospital management as often as possible, not only in words but in the actions of the radiology practice.  When the physicians are working together with the hospital to solve problems they will become more valuable as members of the community and not seen as ‘hired hands’ who interpret images.  In return, the physicians can solicit support for some of their own needs. 

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Insurance payers are always interested in a one-stop approach, and they are willing to negotiate with hospitals and physicians who will bundle payments for certain services into a single claim and unified fee structure.  As a larger entity, the hospital gets more attention from payers and when the radiology group can leverage their relationship with the hospital into a better overall fee structure, they will benefit along with the hospital. 


Other avenues to explore are the hospital’s Physician-Hospital Organization (PHO), Independent Practice Association (IPA) and Alternative Care Organization (ACO).  These often provide advantageous contracts and reimbursement rates that are higher than an individual practice can obtain on its own.


Hospitals are interested in forming integrated systems that make the care of their patients more seamless.  Under the right circumstances, the hospital might be interested in joining with the radiology group in the purchase and installation of a unified Radiology Information System (RIS) and/or Picture Archiving and Communication System (PACS) that would tie together the radiology services provide in the hospital with those in an imaging center.  Sharing the cost of such a system can be a great benefit to the radiology group that is trying to cut its costs.


The joint RIS/PACS can also be the focus of an integrated network of physicians within the hospital system.  If a centralized Electronic Medical Records (EMR) component can be added to the RIS/PACS, it becomes the hub for bonding the hospital’s community of physicians and helps to assure that referrals are kept within the hospital’s system.


Opening a new imaging center in a strategic location can be a benefit to both the hospital and the radiology group.  Rather than undertake such a project individually, which could set up a competitive situation, developing the imaging center as a joint venture partnership is a win-win.  By working together with the hospital, the practice builds on its relationship at the same time as it enjoys the additional revenue generated by the facility.

Referring Physicians

The physicians within a community become familiar with the quality of each other’s services and they usually prefer to send patients to those physicians when a referral is needed.  The radiology group should cultivate those collegial relationships through high-quality work, prompt reporting of results with direct feedback to the physician when it is warranted, and easy accessibility for the referring physicians to both discuss cases with the radiologist and to get their patients scheduled as easily as possible. 


Working with the hospital to establish an integrated RIS/PACS/EMR would be perfect, but is not always feasible.  The group can make judicious use of its phone system to be sure calls are answered promptly and appointments scheduled efficiently. 


Whether at the imaging center or in the hospital, a system for referring physicians to directly contact the appropriate radiologist is essential.  A central dedicated phone number can be established for this purpose, even if it is a virtual number from a service such as Line 2.  The auto-attendant menu can list the various areas of importance to the referring physician, such as “MRI”, “Ultrasound”, “Interventional”, etc. or it could be more specific such as “Neuro”, “Body”, etc.  This could also be accomplished through a web site where the listing is set up to dial the extension when accessed on a smart phone.


While many practices view the pending AUC/CDS[1] mandate as a headache, others are taking advantage of it as a marketing opportunity.  Working together with ordering physicians to explain the rules and by making it easy for them to order on your group’s platform will further strengthen your relationship and assure you that the referrals will continue to your group.

Neighboring Radiology Practices 

Over the years many practices have considered merging with a complementary practice in their area to form a larger group that can enjoy the benefits of shared overhead and perhaps obtain more favorable reimbursement.  While these plans are initially met with great enthusiasm, there is always a reluctance among the physicians to lose their own culture and control over the way they practice, and so in many cases the merger is never completed.  One solution short of a full merger is to enter into a joint venture with another practice in areas that can benefit both, from overhead and administrative functions to the development of an imaging center that serves the area of both practices. 


Saving money in overhead is as good as generating additional revenue.  A jointly owned Management Services Organization (MSO) is one way to share overhead while the practices maintain their operational autonomy and culture.  The MSO can handle such things as billing and collections, IT support, and MACRA/MIPS compliance.  Beyond these administrative functions, the MSO could implement a cross-coverage platform for radiologists to provide sub-specialty needs and after-hours availability.  A more ambitious undertaking would be to pool all of the practices’ employees under a single employer that can negotiate more favorable health insurance and other benefits plans for the larger combined group, as well as to centralize the increasingly complex Human Resources responsibilities of the practices. 


Joint venturing in this manner does not have to be limited to two practices, or even to practices in the same geographic area.  There are many examples of such organizations in radiology that span wide areas of the country and include many practices.

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In order to survive, radiology practices need to increase their revenue and/or streamline their operations to reduce overhead costs.  However, the decision to merge the practice or to sell it to a large entity is not palatable to many physicians who enjoy their autonomy and independence.  Building on existing relationships and leveraging any opportunities they present is a first step toward maintaining a group’s independence. 


[1] The Medicare rule beginning in 2020 will require ordering physicians to access Appropriate Use Criteria (AUC) using a qualified Clinical Decision Support (CDS) mechanism when ordering certain imaging such as MRI, CT and certain nuclear medicine exams.  For more see our recent article on this topic.


Rebecca Farrington is the Chief Revenue Officer at Healthcare Administrative Partners.


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