Outpatient IR Centers of Excellence: Trends in Practice Expansion

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As radiology practices react to the impact of the DRA, some are tapping into the potential of interventional radiology to expand their outpatient services An older medical oncology patient had undergone the paracentesis procedure once before at a hospital. After she had it a second time at Sarasota Interventional Radiology (SIR), Sarasota, Fla, she met with Gerald Grubbs, MD, SIR’s founder, to let him know that his billing company had made a mistake. “She had her bill in her hand and told me that we had not charged her enough,” Grubbs says. “She had paid $8,000 to the hospital the last time, and our bill was only $500—but I told her that the bill was correct, which it was.” Reduced patient costs are but one advantage that is fueling the growth of outpatient interventional radiology (IR). Other factors include the continued shift of inpatient imaging to the outpatient setting, as well as the subspecialty’s notorious ability to reinvent itself continuously in response to market needs and technological innovation.
If the DRA has had any benefits, the best one may be that it has propelled IR into the outpatient realm by forcing an increasing focus on the business side of outpatient imaging. This business perspective—the trend toward reviewing financial and staffing metrics in a more focused and more frequent manner—has led to the strengthening of those centers that were already doing well and the improvement of those with marginal results. More than that, however, it has led to a heightened level of entrepreneurial activity. A Natural Evolution Some leaders of outpatient IR enterprises acknowledge the lack of sophisticated or formal market analysis prior to opening. They gave these projects the green light because they perceived a void in the marketplace, because they wanted to improve patient care, or both. Thomas Lombardi, MD, of Riverside Radiology Associates in Columbus, Ohio, says, “We opened the center because we saw a need for pain patients and other elective cases in a hospital setting typically having delays or getting bumped from the schedule. We wanted to facilitate a more convenient setting for the patients in a more comfortable environment. We wanted to house both the pain management and the pain therapies in conjunction with diagnostic imaging in a more upscale, spa-like setting.” The natural cycle of any successful business includes product and service expansion. Just as obstetrician/gynecologists have added aesthetic services, and as anesthesiologists are becoming a force in pain management, many outpatient imaging centers have turned to a broader service line of procedures—not only to attract new referrers and patients, but also to maintain the viability of existing relationships.
These conscious decisions to invest (and, in some cases, to invest heavily) in what could, arguably, be called a gamble have launched a new era in outpatient imaging. One hallmark of this new era is a deeper reach into the surrounding community—one that attempts to attract a broader range of referrers and that often is dependent on a direct-to-consumer marketing effort to help ensure success. Marcia Flaherty is Riverside Radiology’s CEO. With Lombardi and others in their business, she has overseen the creation and development of a four–year-old facility, Premier Medical Imaging, that is expanding in both size and scope.
The center has focused on pain management and vein therapies, with specific plans to add more services in the near future. “When we set this up, we had pretty high quality standards,” Flaherty says, “so I can’t tell you that there is any different approach to our quality based on this center than what we would typically do based on the quality processes that we would normally apply within this group.” Medical Diagnostic Imaging in suburban Milwaukee opened the Milwaukee Vein and Laser Center (MVLC) several years ago. Carol Martin, executive director, says, “We opened the vein center in 2003, before laser vein treatment became popular. I don’t believe there were even approved CPT® codes for reimbursement at that time. It was challenging to receive payment; overall, receiving preauthorization for these treatments is probably our biggest hurdle.” She adds, “One of the reasons we opened was to diversify ourselves from medical imaging, which requires a company to rely on payors for an appropriate level of payment. The vein center allowed us to go into a more self-payment type of cosmetic retail program. This was before the DRA, so I can’t say that was the reason we did it, but I will say that since the DRA, we’ve expanded into other cosmetic care.”
At Riverside, there was no team of outside consultants offering opinions on which direction to take; just instinct, supported by years of watching and listening to the developments in the local medical community. “We had been in the planning stages for two to three years before actually embarking on the center,” Lombardi says. “We identified the need for a more upscale environment for pain-management patients in an outpatient setting.” As Riverside investigated its own market for pain-management services, Lombardi and practice president Mark Alfonso, MD, recognized an apparent lag in the planning of those centers, particularly for those with an upscale delivery model combining diagnostic imaging and pain management. Lombardi says, “We married the two together and created cutting-edge diagnostics in the same location as pain management. It was an embryonic development.” Riverside wanted diagnostic imaging to be a primary function of the center, Lombardi says, “but we also realized that there is a huge proliferation of diagnostic imaging centers. We saw pain management as a key component to the center.” Realizing a Vision For Grubbs, opening an outpatient interventional center was the realization of a vision. “I completed a fellowship in cardiovascular and interventional radiology at the Miami Cardiac and Vascular Institute at the Baptist Hospital of Miami, then left and went to Naples, Fla, for 10 years,” Grubbs explains. “For the better part of the last two years, I tried to convince the 15 members of the practice to move to an office-based setting instead of relying on the hospital for IR procedures. After all, why go to a hospital? Why not create a nicer environment—one with the latest technology and one-on-one nursing care—at a fraction of the cost of a hospital procedure? This is a win-win for everyone except the hospital.”
"There was no huge amount of demographic research done; it was basically understanding that no one else was doing it. Patients used to end up going to the hospital for vein stripping." —Carol Martin, executive director Milwakee Vein and Laser Center
Grubbs found that attracting patients was best accomplished through applying some common-sense patient-care beliefs, along with a well-placed connection. He says, “Patients could spend two hours sitting at the hospital versus getting faster service at our setting, at one quarter of the cost. As a result, lots of work started coming to me. Then, I made the decision to develop a big, state-of-the art center in Sarasota.”
As the new kid on the block in Sarasota, Grubbs benefited from cultivating relationships. “An emergency-department physician I had worked with earlier was well connected, and he introduced me to one of his best friends, who was head of a Florida cancer group. The medical oncology part helped me get the ball rolling, and it is still the busiest part of my practice,” he says. SIR’s oncology procedures include cryoablation, needle biopsies, radiofrequency ablation, and laser therapy. The due diligence performed by MVLC included on-site visits to determine the feasibility of the plan. “There really was no competition: No one was doing this,” Martin says. “We went to other cosmetic physician offices to get a feel for what it entailed, such as how many patients you could see a day, pricing, equipment requirements, and staffing requirements, but two of our interventional radiologists, Emil Hurst, MD, and Shirish Patel, MD, are the ones who really went out and did the research and pioneered this.” Martin continues, “They knew there was something better to be done with varicose veins and they wanted to be involved in it. There was no huge amount of demographic research done; it was basically understanding that no one else in the area was doing it. Patients used to end up going to the hospital for vein stripping.” Better Than a Hospital? One of the ongoing challenges faced by the new centers is the perception that a hospital is a better source of high-quality care. Rather than try to compete with that perception, Riverside has embraced it, and has developed clearly defined roles for each facility. “We prescreen all patients who come in,” Lombardi says. ”If there are patients who are at higher risk or who would otherwise benefit from a hospital environment, thosepatients would be scheduled there. We have our own scheduling system that encompasses all the scheduling for the hospital, as well as for our outpatient center. We find that it’s just more efficient for the patients.” Lombardi adds, “There are certain procedures that we don’t do in the outpatient arena, such as cervical discograms, because those can be associated with postprocedural pain and require observation. We do conduct the consults for those procedures at our center, however.” To help position himself in the area against local hospitals, Grubbs once again relied on relationships. Much of building a patient base, he says, “has to do with the referral patterns of the physicians. I invited them to come and see the way I have my office set up; it looks more like an ambulatory surgery center than an office.” It usually takes much more than relying on these qualities, or on one’s overall reputation, to keep referrals and patients coming through the door, but Riverside appears to be an exception. “Most of what we get is through word of mouth,” Lombardi says. “We don’t do a huge amount of marketing. Initially, we spent time going out to various physician offices, but having the patients themselves get the word back to the referring physicians generates our new patients.” Not only does Flaherty concur, but she also points to patient influence as a driver for the expansion of the service line. ”Our patients give us a lot of feedback—particularly our pain patients, who have really appreciated the center. They’ve even asked us to look into providing additional treatments.” Currently, MVLC performs vein procedures, such as endovenous laser ablation, ambulatory phlebectomy, and sclerotherapy. Cosmetic services include laser hair removal, laser skin rejuvenation, and chemical peels. Flaherty says that Riverside is considering adding acupuncture, massage therapy, and yoga to MVLC’s service offerings. MVLC has taken a more traditional marketing approach “We have done everything and continue to do everything, such as radio commercials, and we include specials on the ads that are found on our Web site,” Martin says. “We have a Web site dedicated to the center and other cosmetic services. We have done ads in Milwaukee Magazine and ads in high-end magazines. We have done coupons in Valpak® direct mailings, and actually, those have done quite well. We have done telephone-directory ads but have not done postcards in the mail.” Martin continues, “We’ve done television, too. It was a cable network on a segment hosted by Meredith Baxter Birney. This was a health program, and we had a three-minute segment that showed an endovenous laser ablation being performed and included some interviews with patients who had had the procedure done. We’ve also had 30-second commercials that aired as well. The interesting thing is that the television segment did not do that much for us; we did not see that much of a return on it. What we are seeing the best return on, believe it or not, is the telephone directory. We do get some referrals from physicians, such as podiatrists, infectious disease specialists, and hyperbaric physicians.” MVLC’s marketing includes a strong focus on converting its captive audience. “We have a consumer marketing folder that we hand out to every patient who comes through the imaging center, whether it is for MRI, CT, or ultrasound,” Martin says. “We hand the patient this packet of information that has coupons with discounts for cosmetic services. We are seeing some of these patients coming back in and having vein treatments or cosmetic treatments.” Grubbs pays special attention to the economics of medicine and marketing. When meeting with new physicians who are not referring to him, Grubbs discusses the financial aspects of service from all perspectives, all the way down to the impact of the referral on the patient’s copayment. One of the reasons for the minimal amount of marketing at SIR is the facility itself, which inspires patients to talk about it. Grubbs says, “Our environment is less like an office and more like a spa. Patients get very personal care, and they become my best marketers. I can’t tell you how many referrals I’ve gotten from patients’ word of mouth.” Sometimes, however, outside help is required to develop a brand or establish a position in the community. Grubbs says, “I have a consultant who helped me open doors that I couldn’t because he has connections to radio and TV stations. Marketing money well spent is money very well spent. We haven’t gotten big enough to hire a dedicated marketing person, so for now, we are relying on our good name, our good reputation, and our good outcomes, which are the best forms of marketing.” Economically, it has also made sense for Grubbs to open his doors to his colleagues. “I am keeping my overhead down by allowing other physicians to use my facility to do their cases,” Grubbs says. For Grubbs, that use of his center also brings in referrals from those physicians. The Technology Arms Race Because IR is increasingly imaging dependent, innovations for many IR services seem to move faster than the speed of laser light. “The technology (fortunately or unfortunately, depending on how you look at it) changes constantly,” Lombardi says. “Obviously, our reputation is at stake. Right now, we are in the process of providing an enterprise-wide 3D reconstruction program that will allow physicians from anywhere in the system to perform multiplanar work in 3D, no matter where they are. We also do CT colonography at the center, and those numbers continue to grow, based on demand from the patient population. In order to stay ahead of the curve, we have a continued program of evaluation and investment in technologies.” Grubbs also makes sure he is active in the new technology wars that flare up across his market. “We have all the latest equipment,” he says. “It rivals that found in any local hospital.” Centers with a narrower breadth of services, such as MVLC, had a relatively small initial technology investment. “Our technology investment was not much, compared with medical imaging,” Martin says. “To start, we purchased a laser and equipment for sclerotherapy and other basic equipment such as exam tables, but that was about it.” Martin adds, “Keep in mind, though, that the dollars going into the advertising campaign are three to four times as much as we have to spend on the medical imaging side of things. Where we don’t have to spend it on equipment, we definitely have to spend it on advertising.” Today, in addition to vein treatments, patients can go to MVLC for laser skin rejuvenation, laser hair removal, Botox®, dermal fillers, microdermabrasion, chemical peels, and ultrasound phoresis therapy. Because Riverside’s Premier center incorporates diagnostic imaging and its interventional radiologists provide the full menu of IR services, the center requires the full continuum of medical imaging technology in order to provide CT angiography and MR angiography. “The technology race took us by surprise,” Lombardi says. “In 2004, we had been negotiating our contracts with the vendors for six to eight months. During that time, we had been looking at the latest technology, which had just gone from a four-slice CT scanner to an eight-slice scanner. By the time we inked the deal, the 16-slice scanner had come out,” he adds.
"[The business] really has picked up since we opened. When we started, we were only open two days a week, but then two days turned into three, four, and so on. Now we’re going full speed ahead." —Gerald Grubbs, MD Sarasota Interventional Radiology, Sarasota, Fla
To maintain its commitment to superior care, and to stay ahead of the competition, Riverside bought the 16-slice version. “We were very ecstatic to be able to offer the first 16-slice scanner in the market. Then, about eight months after that, 32-slice scanners, and then 64-slice scanners, came on the market.” Riverside’s decision to invest in these new technologies was the result of an ongoing program that is simple and that has been effective for decades: The center asked its patients. “We survey every patient who goes through the center in terms of ways to improve our service to them,” Lombardi says, “and that’s how we look for the different service lines we can offer to those patients.” He adds, “In terms of the vein procedures, such as those for some of the very small spider-type veins, we have just acquired the latest generation of laser systems because a lot of these patients are looking for additional aesthetic services. Now, we can provide, for example, skin-resurfacing procedures and ablative therapies, and we’ll also be looking at additional vein therapies for smaller veins. We’ve just acquired a multiwavelength intense pulsed light system and an Nd:YAG laser, so we’re going to be able to offer more comprehensive cosmetic services to those patients.” Staffing Needs One important component for Grubbs was bringing qualified anesthesiologists on board. “I made a commitment to recruit board-certified anesthesiologists,” Grubbs says. “I educated the referring physicians that the quality of our care would be as good as, or better than, a hospital’s, as would sedation. These are experts in their field. I can’t tell you how many times patients come out from under anesthesia and tell us they can’t believe we actually did something to them.” MVLC began with baby steps. “We started with one full-time nurse who had experience with vein treatments and cosmetic services,” Martin says. “We had that one person for two years before expanding by hiring an aesthetician and two more nurses. Because we are a smaller imaging center, everyone wears a lot of hats. For example, we have an MRI technologist who knows aesthetics and worked evenings doing some of our cosmetic retail treatments.” Grubbs built the business gradually. “It really has picked up since we opened,” he says.”When we started, we were open only two days a week, but then two days turned into three, four, and so on. When 2005 hit, that’s when we were open five days a week, from early morning to 5:30 in the evening. Now, we’re going full speed ahead.” At Riverside, creating the right team also was of paramount importance. Rather than start the recruiting process from scratch, which would involve casting a wide net in order to yield a few results, the Riverside team used a focused approach. “We actually went out and recruited, in the market, the leaders in pain management, and from that, we were able to recruit additional interventional radiologists who were primarily interested in pain-management therapies,” Lombardi says He adds, “All nurses and physicians must maintain Advanced Cardiac Life Support accreditation. Any new staff members undergo an extensive training period, not only for the procedures but for the policies of the center as well. There is a recertification that all staff have to undergo each January.” Today, one of Grubbs’ major concerns is a legal one that will affect every similar operation. “I’m concerned that one day, the hospital lobby in Washington will convince legislators that what we are doing should not be done, but until that time, we’ll keep going,” he says, speaking as a true entrepreneur.