OP-ED

How Technology Will Disrupt Your Doctor’s Monopoly

flying cadeuciiAlthough you may not realize it, your doctor is a monopoly. Yes, you can see someone else, but not without difficulty. And if you wanted a second opinion, how far would you go? In part, through insurance coverage, in part based on a desire for convenience, healthcare is generally a local monopoly. However, that may be about to change.

I’m a radiologist, an expert in medical imaging. When I started my career in 1997, I’d show up for work and it was just me and my films. The exams presented to me were a mix of imaging- CT, MRI, ultrasound, plain X-Rays- all captured, presented and stored on film. By 2000, the film was gone. Just about everything I did was done on a computer.

I was an early proponent for this technology (also know as PACS for Picture Archiving and Communications Systems). It allowed my group to work faster and smarter. However through a series of steps (consolidation, specialization and finally commoditization/globalization) technology broke up the local monopoly many radiology groups enjoyed. Similar to Instagram, PACS allowed medical images to be seen instantly by anyone anywhere. And now, based on improvements in technology, I’m expecting similar changes for the rest of healthcare.

Consolidation

Tele-radiology first emerged in hospitals when computers began to be used to optimize the daily workload. At the beginning of my career, several doctors divided work for the day into piles. Each person did his or her allotment with no real help from peers. With the transition to digital, work became a common pile that was shared among physicians in the same hospital. Faster doctors filled downtime gaps reading more cases, resulting in improved overall efficiency.

Such consolidation of work expanded to other operations with the development of specialized software. Take scheduling in today’s brick and mortar clinics. There are gaps when patients don’t show or an appointment ends earlier than planned. These gaps in the schedule represent lost revenue. ZocDocs, a technology start up, attempts to solve this problem by filling appointment gaps in clinical practice. Now a myriad of companies has improved a range of internal operations, starting from the same concept of consolidation.

Specialization

During the next phase radiology practices realized they could improved efficiencies by sending the right case to the right person in the practice. Like the rest of medicine, radiology is highly sub specialized. For example, I am a neuroradiologist. I can generally read exams of the brain and spine faster and more accurately than radiologists who cover the whole body. Radiology groups soon realized there were advantages to having cases sent to specialists within their group rather the next available radiologist. (And—take note patients—asking for a specialist to read your imaging rather than whichever radiologist is on that day incurs no extra cost).

Commoditization and Globalization

It wasn’t long before entrepreneurs realized that cases could be moved outside of the hospital to radiologists anywhere. At first these forward-thinking businesses limited such out-sourcing to night-time coverage (Nighthawk is the best example). However, these companies quickly expanded and now compete with local radiologists for work during the day. The larger size of these national companies often allows for better technology and more specialists. So, even though, traditionally, healthcare—including radiology— has been a local monopoly, the future is clearly going to be one of increased globalization of services based on cost and quality.

Implications for the Future of Healthcare

Telemedicine, as part of every day clinical practice, is more complicated than tele-radiology. However, over the last two decades technology has now evolved to support all forms of clinical services. Particularly for specialty services, the best care is often not the local care. And, with virtual clinic visits as close as the PDA in your pocket, I expect some of the same trends in radiology to occur for healthcare overall.

When I started my career, Kodak, the venerable producer of film for a century was near it’s peak value of 32 billion dollars. A little more than a decade later, having missed the transition to digital, Kodak was bankrupt. Change is coming. Now, video can be shared as easily as medical images. Healthcare no longer has to be local to be convenient. The patient, or more likely the patient’s insurer, will negotiate the best rates and best quality for expensive procedures and other services. This is already happening at more progressive self-insured employers such as Walmart and Lowes. For you as a patient, this is great. It should mean better care at a lower cost. For physicians and other providers, we will have to adjust or go the way of Kodak.

Alan Pitt, MD is a radiologist based in Phoenix, Arizona. He is the chief medical officer with Avizia.  Read his blogs at AlanPittMD.com

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Scott HodsonbirdSaurabh JhaLegacy Flyerplaton20 Recent comment authors
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Scott Hodson
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The concept of “disruptive innovation” is central to effective strategic planning. Every product or service has a definable “life cycle” that can be depicted as a bell curve. At the early stage of adoption “product innovation” is high – for example the early Apple computer that included a disc drive and keyboard. As the product climbs the life cycle curve product innovation declines and “process innovation” takes over: functions and features increase, price declines. The life cycle peaks, and the product or service shifts to the downward slope when a “disruptive innovation” occurs. Consider what the iPad/tablet has done to… Read more »

ALAN PITT
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Several additional comments. I have clinical training in both radiology and neurology. I have some sense of direct clinical care, but admittedly most of my career has been spent in radiology. I try to train my residents and fellows not to be right, but to be reasonable. Many radiologist tend to pass the buck, offering a laundry list rather than relevance. This list offers means risk, worry and cost for someone else. My father, also a radiologist, has always said the radiologist should strive to be the clinician’s clinician, to address the images with a level of reverence for the… Read more »

bird
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bird

As a primary care physician i dont have the luxury default of “can not exclude neoplasm, infection or normal variant, clinical correlation is advised” It is the reason i dont consider radiologist clinicians. Very valuble and necessary but not clinicians. Most primary care diagnosis are not a clear cut as a glioblastoma or fracture. And as for the walmart comment….i am not ready to my health care be determined by the lowest bidder.

Legacy Flyer
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Legacy Flyer

Alan, “When I started my career in 1997 ….” I started my career in 1984 and things were similar to what you describe, we were working with analog images (films). I was also a strong proponent of PACS. “Tele-radiology first emerged in hospitals when computers began to be used to optimize the daily workload.” This is not really true. Tele-radiology started as a way to cover night time and off hours imaging remotely. Our group started doing Tele-radiology in 1996 and continues to this day. Early tele-radiology was done by digitizing films and sending CTs via “Photo Phone” technology. As… Read more »

platon20
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platon20

I agree with Alan Pitt completely. I find it hard to believe that the University of Arizona would pay him to be a faculty person when in fact they can get a better faculty at 1/5th the cost by hiring a radiologist from Bangalore. Why should Barrow Neurological Institute pay Dr Alan Pitt an outrageous salary well into the 6 figures when there are thousands of Indian radiologists who can do the same job for less than 1/3 the cost? Please tell me why we pay Alan Pitt an outrageous amount of money and waste the efficiency of foreign doctors… Read more »

Saurabh Jha
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Saurabh Jha

That’s an excellent question which every radiologist must ask themselves. What portion of our job requires a medical degree?

William Palmer MD
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William Palmer MD

Monopolists (dominant sellers) and monopsonists (dominant buyers) have what is called market power. This is the ability to affect prices. When you can do this, you make prices. When you can’t do this, you have to take prices. I.e. you have to live with prices that are set by many buyers and sellers in what amounts to an auction. Therefore, the monopoly metaphor is not accurate, although a patient may well behave as if you are his only savior, If docs could get together, they would be in a position to affect prices. This is what hospitals have been doing… Read more »

ALAN PITT
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Thank you all for the comments and the healthy dialogue. I’ve sometimes referred to healthcare as Compassionate Capitalism. We have a responsibility to care for the sick, but there need to be effective business models to continue to do so. Teleradiology enabled new business models. I would agree with many of the comments- primary care, patient visits, are far more complex and nuanced than imaging. Imaging requires a blob of information to be moved to an individual for interpretation. Telemedicine requires 2 and often more people to be coordinated in the cloud. Further, the encounter has to leave the patient… Read more »

Jacob Reider
Guest

a) I second Leslie – seconding Rob. b) I agree with Alan that these things are happening – especially in domains like his – where a specific skill is what’s most important – and that skill is something that can easily be leveraged with technology. His interventional colleagues doing procedures in the hospital are not nearly so easily electronified – nor are primary care docs. c) Yet there is a resonance that you can hear in Rob’s note: health IT can/will/should CONNECT us with our patients more – just as your high school friends’s photos are oddly in your facebook… Read more »

Quan Nguyen
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Quan Nguyen

I agree with their opinions.

Leslie Kernisan, MD MPH
Guest

Hm…I am agreeing with Alan but also w Rob. Completely agree that primary care and most longitudinal care benefits from the relationship. That said, now that I’m no longer a PCP and focus on geriatric consultations, I review people’s primary care notes all the time. Many of them really benefit from a second opinion. In some cases, they just need to hear about other options. In other cases, something important was being missed. Let’s face it, most people do not have Doc Rob as their doctor. Now that people are more able to access their medical information, and keep it… Read more »

Rob
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Here’s the difference between radiology (and many/most subspecialties) and primary care: the technical aspects of specialties are more important than the relational aspects. In other words, you can send films to be read across the country (or the world) and the patient can get care that is equal in quality. The most important thing to the patient is the technical skill of the doctor reading the film or doing the procedure. In primary care, on the other hand, there is a far stronger relational aspect to care. When my patient calls me with chest pain, headache, or frequent urination, I… Read more »

lawyerdoctor
Guest

Your points are well taken, Dr. Pitt. I am an ER physician and we really appreciate the availability (perhaps more so than any other specialty) of after hours expertise at imaging results.

But someone still has to put hands on that patient, and it isn’t (or shouldn’t) all NP’s or mid-levels . . . I’ll probably be very happy when I can get paid to sit in my room and have mid-levels “FaceTime” me their patients?