Final Teleradiology Reports: A Strategic Advantage for Radiology Groups

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1 Final Teleradiology Reports: A Strategic Advantage for Radiology Groups Recover Nighttime Teleradiology Costs, Improve Productivity and Increase Revenue by Eliminating Next Day Over Reads By Cynthia Keen and Christine Boehm White Paper Page 1 of 10 Teleradiology services have transitioned from a convenience service to enable radiologists to improve their quality of life to a strategic business decision that helps radiology practices improve their bottom lines. The role of final reports and the revenue generated by them are critical in making teleradiology truly pay for itself while increasing the efficiencies of the radiology group practice. This white paper discusses final report usage compared to preliminary reports and addresses comparative costs, efficiencies, credentialing, workflow and billing. It reviews the process required to implement final report delivery from a teleradiology provider and the advantages in efficiency and cost that can be achieved by the contracting radiology group. In one example identified in this paper, a large Florida radiology group was able to generate nearly $300,000 by billing final nighttime CT reports that were interpreted by their teleradiology providers. The use of preliminary reports, or wet reads, is associated with STAT interpretations of examinations for emergency department patients. Its use has proliferated with the practice of applying teleradiology technology to augment on-site radiology services for hospital emergency departments to provide 24/7/365 coverage. Today, radiology groups typically utilize teleradiology services for night time support to improve workload and lifestyle balance. During the past 30 years, teleradiology has evolved from being perceived as novelty technology whose purpose was to deliver diagnostic images from geographically remote locations where there were no qualified physicians to interpret them, to being an at home convenience for on-call radiologists at night, to being an efficient and cost effective way of providing expert diagnostic interpretation for healthcare facilities day and night. Teleradiology service providers today are recognized as credible and valuable resources for augmenting the radiology staff of the local medical community. American College of Radiology practice guidelines endorse the use of teleradiology. The 9th goal in the ACR Technical Standard for Electronic Practice of Medical Imaging is: Supporting telemedicine by making radiologic consultations available in medical facilities without onsite radiologic support. The ACR also indirectly recommends the use of subspecialty teleradiology in its 11th goal: Providing timely availability of radiologic images, image consultation and image interpretation in emergent and nonemergent clinical care areas by (a) facilitating radiologic interpretations in on-call situations and (b) providing subspecialty radiologic support as needed. This metamorphosis of teleradiology, made possible by technological innovation, also makes it more feasible for preliminary reports to be replaced by final reports as the deliverable of a teleradiology practice. Like teleradiology itself, delivery of a final report represents more efficient use of the local radiology practice s time because the time spent re-reading and finalizing a preliminary report can be better spent on interpreting a new final report. Clinically specific, high quality, detailed reports from trusted radiologists do not require a second dictation to become a final, legal document. Today s technology makes it possible for an electronic final report created externally to transfer seamlessly into the patient s electronic medical record, for rapid efficient review by the referring physician.

2 Page 2 of 10 Preliminary vs. Final Reports A preliminary report, by definition, is a concise diagnosis of the medical condition of a patient, with recommendations for additional procedures, as diagnostically applicable. It is an incomplete diagnosis as it focuses on a single aspect of the patient s condition. Preliminary reports are primarily used for emergency department coverage and as such, thirty minutes or less is the industry standard of care. Preliminary reports are typically faxed to emergency departments, although with the latest technology, reports can also be delivered via the Web. Radiologists are required to telephone their findings for Level I and II trauma cases or as deemed medically urgent, in accordance with ACR guidelines. Preliminary reports may be communicated verbally, electronically, or in writing. The method of communication should be documented, as well as any direct conversations with other physicians about the contents of the report. The speed of delivery for emergency cases overtakes the detail and time that is spent preparing a final report. The assumption of a preliminary report is that when a diagnostic image is reviewed again under less urgent situations, additional findings may be identified, and these can be added to or modified in the preliminary report. The preliminary report has historically been a document in transition and was not able to be billed against. A final report is the permanent interpretation of a diagnostic procedure. It should contain all of the elements and clinical detail of a well-written report in accordance with the standards established by the radiology practice and the recipient hospital or medical center. Documentation of any discrepancy between the preliminary and final review must also be included. The final report is entered into the patient s permanent medical record, and is the document used to invoice payors for professional services rendered. Why Preliminary Reports Became Standard Teleradiology Service Deliverables Teleradiology was initiated in the late 1970s as a way to deliver x-ray images from locations like offshore drilling rigs and remote Arctic villages to a physician who could interpret them, preferably a radiologist. The camera on a stick images transmitted by telephone lines were visually crude, but they enabled radiologists to assist in the triage and on-site treatment of a patient and to determine if an evacuation to a more sophisticated medical facility was necessary. In the 1980s, teleradiology morphed into at home delivery of after-hours emergency related images. Because the images were not of diagnostic quality, the radiologist would do a wet read call in a preliminary report, view the films the following day, and dictate the final report. For some hospitals, the on-call radiologist using teleradiology could provide a preliminary diagnosis to emergency department physicians faster than driving to the hospital and reviewing the films in person. The increasing availability and affordability of higher speed Internet connections made it feasible in the 1990s to transmit diagnostic quality images. Digitizers had become technologically sophisticated to create near-diagnostic quality images of x-ray films. CT procedures increasingly were being ordered by emergency physicians. Nighthawk teleradiology services began to proliferate, providing fast turnaround times to hospital emergency departments that sought 24/7 coverage. The reports faxed and telephoned to emergency department (ED) physicians were preliminary. Rapid turnaround time was and still is imperative. Faxed preliminary reports still needed to be converted into final reports, and for the majority of hospitals, even if a report was also sent electronically, few hospitals or radiology departments had the interface engines needed for efficient digital records transfer. The gradual evolution of diagnostic imaging from predominant utilization of x-rays and ultrasound to computer technology-driven multi-detector CTs, MRIs, SPECT, PET, PET/CTs and the proliferation of 3D and 4D advanced visualization software in addition to clinician specialization accelerated the need for subspecialty radiologists.

3 Board-certified subspecialty radiologists are in short supply, particularly in non-urban geographic areas. Many practices do not have the volume required to make a viable financial case to have these subspecialists in the practice, even if the practice and referring physicians require their expertise. More referring physicians require radiologists with specific levels of credentials such as neuroradiologists with certificates of added qualification or fellowship-trained musculoskeletal radiologists. The teleradiology model helps provide access to specific levels of subspecialty expertise to help augment staff coverage, especially when volume does not yet require a full-time on-site radiologist. This need, combined with the revolutionary healthcare IT innovations of the past decade, make subspecialty teleradiology services a cost-effective adjunct to nighttime, overflow and vacation coverage. Radiology groups can access subspecialty expertise on an as-needed basis. Page 3 of 10 Market Trends Supporting Final Reports by Teleradiology Service Providers The adoption of teleradiology has proliferated and gained acceptance because it optimizes the use of a scarce resource, in this case a radiologist who needs to be in more than one location at the same time to provide professional services. It has helped radiologists improve the quality of life by not having to provide nighttime emergency department coverage. Teleradiology is about increasing radiologists efficiency, improving work/life balance and optimizing staffing costs, meaning supplying on-demand access to the right types of radiologists when needed. The contracting for final report delivery with a teleradiology service provider upholds these principles and adds one more significant benefit cost savings. It is less expensive and far more efficient for a reputable teleradiology service provider, and especially one delivering reports by subspecialty experts, to provide a report that does not require any hands-on attention by a local radiologist. Technology has minimized the hurdle of electronic document transfer and integration from one system to another. By contracting for final report delivery with a U.S.-based teleradiology service provider, radiology practices also protect their businesses from being undermined by non-u.s. licensed radiologists from interpreting cases. Reimbursement by Medicare, Medicaid and TriCare CHAMPUS represent between 35 to 50 percent of the business of a typical radiology practice. Federal government law mandates that final reports be produced by a physician licensed to practice in the United States before payment by any government agency is made. In a research study conducted at RSNA 2007 by IMV, a medical market research company, (commissioned by Franklin & Seidelmann Subspecialty Radiology), 32 percent of radiologists polled indicated they were interested in utilizing a teleradiology service for final reports compared to 41 percent who indicated an interest in preliminary reports. This shows the acceptance of final teleradiology reports as a staffing optimization tool. Licensing and Credentialing Requirements All radiologists providing both a preliminary report and a final report via teleradiology must be certified in Radiology or Diagnostic Radiology by the American Board of Radiology or the American Osteopathic Board of Radiology, or the radiologist must have training in an Accreditation Council for Graduate Medical Education approved general or diagnostic radiology residency program or an American Osteopathic Association approved diagnostic residency program. The ACR Technical Standard for Electronic Practice of Medical Imaging states that: Physicians who provide the official interpretation of images transmitted by teleradiology should maintain the licensure required for providing radiologic or telemedicine service at both the transmitting and receiving sites. Physicians practicing teleradiology should conduct their practice in a manner consistent with the bylaws, rules, and regulations for patient care at the transmitting site and receiving jurisdiction. It is common for the radiologists working for teleradiology service providers to be licensed in numerous, if not all, 50 states.

4 Page 4 of 10 Radiologists providing preliminary or final reports as a staff member of a teleradiology service provider need to be privileged and credentialed at the hospital where the patient has received diagnostic services if the radiologist s name is to appear on the report. The ACR Medical Legal Committee defines official interpretation of a radiologic procedure as the written report, as well as any amendments or supplements to it, that attach to a patient s permanent record. The Committee mandates that: In health care facilities with a privilege delineation system, such a written report is prepared only by a qualified physician who has been granted specific delineated clinical privileges for that purpose by the facility s governing body upon the recommendation of the medical staff. The reasons for hospital credentialing are several. The remote radiologist is, in essence, actively contributing to the treatment of the patient. Depending upon hospital bylaws, this can be a liability issue for the hospital instead of the contracting radiology practice. Additionally, with respect to final reports, the originating (remote) radiologist s services can be invoiced by the contracting radiology group to the payors without question. It is the responsibility of the local radiology practice to submit the credentials of the individual radiologists of the teleradiology service providing reports to the hospital. Typically, the teleradiology service provider submits the credentials of the board-certified radiologists who are licensed in the state where the radiology procedures are performed. The business administrator of the local radiology practice sends the hospital(s) applications for credentialing to the teleradiology service provider. Once completed, they are returned to the local practice, which submits the individual radiologist applications to the hospital(s) where teleradiology service will be provided. Each hospital has credentialing and privileging policies and processes unique to itself, based on its own bylaws. Additionally, each insurance carrier has its own credentialing process as well. Local radiology practices are in the best position to deal with this however, the teleradiology provider should help in the efforts to expedite the credentialing process. Even though The Joint Commission of the Accreditation of Healthcare Organizations (JCAHO) certification was intended to expedite this hospital credentialing process, hospitals each have their own bylaws and typically just don t accept a teleradiology service provider that is JCAHO-accredited without having to still having to go through their processes. JCAHO accreditation does not guarantee that a teleradiologist will be automatically credentialed. Cost Effectiveness of Preliminary vs. Final Reports Preliminary reports are invoiced to the local radiology practice at the negotiated fee. The fee for preliminary reports generally is lower than or comparable to the reimbursement amount that the radiology practice will receive from its insurance payors after submitting claims for its professional services in producing a final report. But this does not mean that the costs for preliminary reports as a deliverable are more economical to the radiology practice than the costs of final reports produced by a teleradiology service. In the long run, contracting for preliminary reports usually is more expensive. Radiology practices need to factor in the additional time and radiologist resources needed to review the images of the procedure, compare it with the preliminary report, and dictate a final report the next morning. Paying a radiologist within the practice to produce a final report after reviewing a preliminary one is comparable to paying for the production of three reports as shown below: 1) the practice pays for a teleradiology service to produce a preliminary report, 2) the practice pays a radiologist to dictate a final report that supersedes the preliminary report, and 3) the practices loses an opportunity cost of not being able to interpret an entirely new case during this time period. The time and costs to review preliminary examinations adds up as shown in the example below.

5 Page 5 of 10 Radiology Group Example One large radiology group with a hospital-based practice providing 24/7/365 services to six urban hospitals in a competitive Florida metro area utilizes two teleradiology services to cover the midnight to 7:00 a.m. shift across all of the hospitals. The group s nighttime volume averages 5,000 studies per month, the majority of which are CT studies. The practice has been using final reports from teleradiology providers since its inception six years ago. The administrator of the radiology group, which regards its utilization of teleradiology services as a highly competitive tool and integral component of its business model, attributes the ability to utilize final report interpretation services as being equivalent to 2.25 full-time radiologists. This means he would he have to add 2.25 full-time radiologists to handle the nighttime volume, which would result in him hiring three fulltime radiologists and one would be underutilized. This is assuming he could recruit radiologists to cover night shifts, which in his market is not an easy task. The radiology group s mix of examinations is very different between day and night. The radiology group reads 60 percent conventional radiography and 40 percent CT, MRI, ultrasound, mammography and nuclear medicine between the hours of 7:00 a.m. to midnight. At night, the mix changes to 70 percent CT and 30 percent radiographs, ultrasound, MRI and nuclear medicine. The teleradiology providers deliver emergent final reports within 30 minutes. Additionally, a teleradiology vendor also provides weekend coverage of Cardiac CTA cases with report turnaround of six hours or less and breast MR coverage and report turnaround within 24 hours. The radiology group administrator noted the key advantages to his group practice, Of considerable value to us in using a teleradiology service for nighttime final reports is the fact that we can bill for these reports to offset our teleradiology costs. Preliminary reports require the staff radiologist who is employed by your practice to come in the next morning and read all of the previous night s cases. Because our nighttime volumes are high, we would lose efficiency and time if we had to over read prelims. He also added, A key benefit of using nighttime teleradiology services is in preserving the quality and life of our radiologists. From the perspective of this radiology group, the final report teleradiology service providers are not seen as competitors. They are an intrinsic part of the practice and need to carry their own workloads. Producing final reports of the quality and the caliber of the group s standards is an expectation. The reimbursement revenue generated by final reports offsets the cost of teleradiology services. Preliminary reports essentially meant this practice would have been paying twice to ultimately generate a final report. Cost Analysis Sample for CT Final Reports Radiology Group Located in Florida Preliminary CT Reports Followed by Final Reports Description Cost Notes Average cost of average CT preliminary report from teleradiology vendor Average cost for radiology group staff radiologist re-reading and finalizing each preliminary CT report $45 Cost for teleradiology vendor to interpret preliminary report. Includes transcription. $173 Includes salary, benefits, overhead, etc. Subtotal for preliminary + final report costs $218 Teleradiology service cost, plus staff radiologist overhead cost per report. 60,000 annual nighttime reports x.70 (percentage of CTs) = 42,000 x $218 Claims revenue radiology group generates for final reports billing of 42,000 CT reports Final costs to practice after applying claim reimbursement revenue Revenue opportunity lost on new final CT report time slots taken up by over reads the next day $9,156,000 Costs for annual CT preliminary reports followed by finals the next day. $2,394,000 Radiology Group s average claim reimbursement for CT studies is $57 $6,762,000 $2,394,000 42,000 reports x average CT reimbursement rate of $57

6 Page 6 of 10 Final CT Reports Only Description Cost Notes Average cost of final CT report from teleradiology vendor 60,000 annual nighttime reports x.70 (percentage of CTs) = 42,000 x $50 Claims revenue radiology group generates for final reports billing of 42,000 CT reports Difference between costs paid to teleradiology vendor and collections made from billing of final reports. Revenue opportunity gained as a result of open time slots for CT cases due to elimination of over reads of CT preliminary reports the next day. Radiology group can interpret new final reports during the time it was spending over reading preliminary reports. $50 Cost for teleradiology vendor to interpret final report. Includes transcription. $2,100,000 Costs for annual nighttime final teleradiology reports $2,394,000 Radiology Group s average claim reimbursement for CT studies is $57 $294,000 The practice makes money from the difference of what is billed to insurance vs. what they pay to teleradiology vendor. $2,394,000 If consult is required the next day by on-site radiologist, there would be time involved, but less time than over reading preliminary reports. As the radiology group case example above indicates, using preliminary CT reports followed by final reports the next day costs the practice out of pocket $6,762,000 per year to cover its nighttime volume. Comparing this to a final teleradiology report provider, the radiology group can recover its nighttime teleradiology costs and can even make a profit. In this example the radiology group earns $294,000 in CT reimbursement revenue, however when taking all nighttime modality report costs and reimbursements into consideration this radiology group does not make a profit. It does, however, recover most of its nighttime teleradiology costs and experiences open time the next day to interpret new cases instead of having to spend this time and associated staff overhead costs on over reading preliminary studies. Overcoming Concerns in Utilizing Final Teleradiology Reports The key concerns radiology groups have when deciding on whether to use a final teleradiology report provider are addressed below: What happens when the ED physician requests a consult? The ED physician would call the teleradiology vendor call center and would be connected to the reading radiologist or another specialist familiar with the case to review the findings. However, we have found that because the final report is accurate and complete with detailed findings there is less need for consults. What if the teleradiology vendor tries to acquire the hospital contract? When you contract with your teleradiology vendor, make sure to include a non-compete clause into the service contract. Additionally, reports can be branded with the radiology group s logo to help convey a seamless relationship between the nighttime coverage radiologists and the group practice. It is also important for the group to get to know and trust the teleradiologists that are supporting them. This can be accomplished through peer review consultations and joint educational activities in order to deliver an integrated service to medical staff customers. How do I know the radiologists are qualified and the final reports are of high quality? The best way to evaluate the quality of the teleradiology provider s reports is to understand the background, education and experience of its radiologists. Also, ask to view sample reports and speak with other clients. When dealing with final reports, it is critical that the teleradiology vendor is focused on multiple aspects of quality:

7 Page 7 of 10 1) Education/Specialization - All radiologists must meet minimum standards of education and experience and should specialize in specific areas of expertise to ensure the greatest level of accuracy (i.e. ED, body, MSK, neuro, cardiac, etc.). 2) Standardization - The reports should follow a standardized workflow for each type of study in order to maximize the delivery of a complete, consistent analysis and improve the ability of referring clinicians and consulting radiologists to easily understand the diagnosis. 3) Consultations - The teleradiology vendor should make it easy for both a referring clinician and consulting on-site radiologist to speak with the teleradiologist. 4) Quality Assurance - The teleradiology vendor should have a well-documented QA process. Do finals cost more than preliminary reports? Final reports typically cost 5 percent to 15 percent more than preliminary reports. However, the group can bill for the final report which offsets the cost for teleradiology services. Compared to preliminary reports which are strictly an out of pocket cost with no offset opportunity these savings are well worth the difference in report costs and extra efforts involved in credentialing the teleradiologists with insurance carriers. How do I save money and increase productivity and revenue potential with final reports? 1) You save money by offsetting teleradiology nighttime coverage costs by billing against the final report. 2) Your radiologists are more efficient because they do not have to over read cases the next morning. Instead, they can use this time to interpret final reports which can be billed and this increases your revenue potential. 3) Utilizing teleradiology services helps augment your staffing strategy when you have a fractional radiologist need, or cannot find a radiologist to work nights, or cannot hire a specific subspecialist in your local area. You can gain the radiologist coverage and expertise needed with out the additional headaches and cost of recruiting and contracting and avoid the risk of underutilizing a full-time salaried radiologist. How does it work? See the step-by-step workflow description below. Billing and Insurance Reimbursement for Preliminary vs. Final Reports Charges for final report professional fees are invoiced directly to the local radiology practice and typically fall under the average private insurance carrier reimbursement rates. The radiology group then submits claims to private and government insurance payors as well as patients. Workflow There are a variety of ways in which the workflow between a radiology group, imaging facility and teleradiology vendor can be implemented, but the key is to understand the needs of all parties involved and work out a solution that meets these needs. The teleradiology vendor will work closely with the radiology group and the imaging facility to implement the appropriate workflow, integration, ordering process, imaging transmission, report delivery and service model. Below is an example of a typical workflow process for nighttime coverage with final reports:

8 Page 8 of 10 Step 1 Credentialing Teleradiology provider assists the contracting radiology group by providing all necessary licensure, credentialing/privileging paperwork required for their radiologists. This process can take from 60 to 90 days depending on hospital bi-laws and credentialing requirements. All physicians must go through this process and most hospitals have a specific teleradiology privileging process. The radiologists must also be credentialed with the radiology groups insurance carriers in order to bill the final reports. The teleradiologists are covered by their own malpractice insurance. Step 2 Images/Information Distribution ED Technologist pushes modality images to teleradiology provider s server. Typically transmission is accomplished via DICOM connection using broadband Internet. Appropriate patient information is sent to the teleradiology vendor as well. This is typically accomplished via faxing paperwork, it can also be done via an online order entry portal. The images and information are distributed to the appropriate radiologist. Step 3 Interpretation Radiologist interprets and electronically signs final report. The teleradiology provider is required to store the patient report. Radiologist calls ED doctor as needed with trauma cases, STAT cases or those deemed medically necessary. Step 4 Report Distribution/Integration Report is distributed to hospital ED, posted in patient s medical record and HIS/RIS. This can be done in a variety of ways, and should be based on the appropriate workflow requirements set during the implementation process. A few options can include: Fax to the ED physician/department Online Web portal access available for report to be viewed, downloaded, and printed by the ED Custom integration from teleradiology provider RIS/PACS/Portal to Hospital/Radiology System Manual process for electronically inserting the report into the hospital/radiology group system (i.e., report copy and paste).

9 Page 9 of 10 Step 5 Consultation In the case of a needed consultation, the interpreting teleradiologist will call physician and is responsible for any addendums or QA steps required. Step 6 Billing Teleradiology provider sends an invoice to the contracting radiology group practice. The radiology group pays the teleradiology provider based on their negotiated fee and submits a claim for the final report to the insurance payor(s) or direct to patient. Key Benefits of Final Teleradiology Report Services: Offset costs spent on teleradiology services by billing the final report. Step 7 QA Process Teleradiology provider manages a QA program for all aspects of the workflow ensuring high quality results starting with the radiologist hiring process and peer review, to patient scanning and image distribution to report delivery as well as the surgical correlation process. Conclusion Teleradiology providers have evolved from being a nighttime convenience service to now being truly an extension of a radiology group. Final reports delivered by a teleradiology provider must be of high quality, with the level of accuracy, detail and timeliness that meet the expectations of the radiology group and its physician clients. Trust is an intrinsic component when purchasing teleradiology services with a final report as the deliverable. Gain back lost opportunity revenue and time due to over reading preliminary reports. Spend this time on interpreting new final reports. Improve radiologist productivity and workload balance. Augment staffing strategy - when partial radiologist coverage required utilize teleradiology until ready for fulltime hire. Access the appropriate type of radiologist required for the study, whether it is a CT chest expert or a Cardiac CTA specialist. It makes financial sense for a radiology group to utilize final teleradiology reports in order to have the ability to bill against the final report to offset teleradiology costs. This also enables radiology groups to spend more time interpreting new cases during the day for which they can bill. This model represents a winning strategy for radiology groups to provide optimal radiology coverage, improved patient care, reduced costs and increased efficiencies. Franklin & Seidelmann, LLC About Franklin & Seidelmann Franklin & Seidelmann Subspecialty Radiology (F&S) is a leading, national full-service teleradiology provider offering final, preliminary and subspecialty reports, day or night. F&S provides clinically specific, detailed, directive, decisive reports and consultative services that enable clients to improve referring physician satisfaction, increase referrals and revenue and optimize staffing costs and workload balance. The F&S network of more than 100 U.S.-based/trained radiologists, who combined are licensed in 50 states, includes: board-certified, fellowship-trained musculoskeletal, body, cardiac and breast MR specialists, and neuroradiologists with CAQs. Founded in 2001, F&S is located in Cleveland, OH, with more than 250 clients and 100 employees. Visit to view report samples, radiologists bios or for more information or call 866-4FS-RADS. About the Authors Cynthia E. Keen is a consultant with I.T. Communications of Boulder, Colorado. Ms. Keen has been involved with teleradiology technology and utilization since 1982, the year that the first commercial teleradiology product was introduced by Colorado Video, Inc. Ms. Keen can be contacted at

10 Christine Boehm is vice president of marketing at Franklin & Seidelmann Subspecialty Radiology. Ms. Boehm has 17 years of marketing and brand management experience and has been involved in the radiology industry since Ms. Boehm can be contacted at Page 10 of 10

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