A study that was published online in late June in the Journal of the American College of Radiology (JACR) has found that the COVID-19 pandemic has had a dramatically negative financial impact on radiology practices nationwide.
Published as a “Journal pre-proof,” in advance of its formal publication in the print edition of the JACR, the article, “Impact of COVID-19 on the Practice of Clinical Radiology,” was written by Max P. Rosen, M.D., M.P.H., Alexander Norbash, M.D., M.S., Jonathan Kruskal, M.D., Ph.D, Carolyn C. Meltzer, M.D., Judy Yee, M.D., and James Thrall, M.D.
After examining available data on radiology practice finances, the authors write, “The profound changes that have interrupted the arc of the Radiology narrative may substantially dictate how health care and radiology services are delivered in the future. If this is the case, then radiologists and their associated institutions and organizations must develop new tactics and strategies to define the pathway forward.”
The researchers examined data on radiology practice across the domains of employment, compensation, and practice structure; location and hours of work; workplace environment and safety; activities beyond the “usual scope” of Radiology practice; and continuing medical education, national meetings, and professional organizations.”
With regard to employment, compensation, and practice structure, the article’s authors write that “The adverse impact of COVID-19 has been greatest on outpatient imaging. A large New York metropolitan health system reported an 87 percent reduction in outpatient imaging and specifically a 93 percent reduction in mammography due to COVID-19. Another constraint on imaging volume (and radiologist’s compensation) might come from third party payers and ultimately CMS [the federal Centers for Disease Control and Prevention] if the decrease in imaging volume experienced during COVID-19 does not have a significant impact on health outcomes. COVID-19 may adversely impact medical students’ choice of Radiology and Radiology residents’ choice of sub-specialty and practice location (avoiding large, densely populated urban centers).”
The researchers note that “The most recent (2019) ACR Commission on Human Resources Workforce Survey found that “[the Radiology workforce] continued to show a relatively stable employment environment and outlook for those seeking jobs as practicing Radiologists in 2019.” The survey reported an essentially stable mix of practice types, subspecialty distribution, and predictable hiring patterns. As noted, this stability has been disrupted by COVID-19 placing enormous financial strain on both academic and private practices. Women radiologists who often have less practice seniority, may be especially disadvantaged due to COVID-19.”
Importantly, the authors note, “Private practices typically disperse all of their profits each year to avoid double taxation. They have no ‘corporate reserves’ or easy methods to develop them. There is no larger organization to back them up apart from what their affiliated institutions might do, if they themselves are financially able. Partnership and employee agreements may have to be rewritten with ‘force majeure’ clauses to allow for increased flexibility in case of another pandemic. Academic groups are usually required to maintain a certain reserve balance, either at the departmental or organizational level. The amount of financial reserves may need to be revisited (and increased) following COVID-19 and academic practices may be forced to include new significant at-risk components in their compensation structure. This could have adverse impacts on the ability to pay monthly bills and maintain current lifestyles.”
Indeed, the researchers note that “A recent survey found that 45% of radiologists not affiliated with a teleradiology company interpreted imaging studies remotely. Radiology practices may choose to cover a fixed percentage of their projected volume internally and rely on teleradiology firms or spot-market and business-to-business radiologist hires to handle any incremental volume, thus reducing their fixed labor costs. With falling revenues and contribution margins, merger and acquisition activity may increase with an even greater acceleration of consolidation of the field into employed radiologist models. In 2019 the ACR estimated that at least 6 percent of radiologists were practicing within a for-profit corporate structure. The number of investor transactions in Radiology had increased steadily from approximately 10 per year in 2000 to 30 per year in 2018. COVID-19 disruption of radiology practice cash flows and lower estimates for future growth may make radiology less attractive to corporate investors. On June 5, 2020 Aunt Minnie reported that Mednax announced that it is restructuring in a plan that includes selling off its radiology business, after a $500M purchase of teleradiology provider vRad in 2015. In its first-quarter financial results, Mednax procedure volume fell 50-60 percent, forcing the company to implement measures to conserve cash, including salary reductions and furloughs for nonclinical employees. It should be noted that a variety of prior financial challenges have resulted in some academic medical centers, with and without associated physicians, seeking shelter in the for-profit sector. This may happen again in the COVID 19 era but is unlikely to be a major trend.”
There are many layers and elements to all of this, including work-life elements. As the authors write, “Since the enhanced deployment of home PACS workstations, it will likely be difficult to return to the “everyone in the department from 8-5” paradigm. Some radiologists may now expect to be able to work from home at least 1-2 days per week. As long as hospital reading rooms are sufficiently staffed for clinical and educational purposes, having some radiologists routinely work from home may have several benefits, beyond social distancing. Eliminating commuting time should create additional work hours, without adding to the length of the workday. Having some faculty read in an uninterrupted fashion may also help to increase overall productivity. Avoiding long commutes can also help to improve individual well-being and allow added personal time. Staggering home interpretation shifts may further help to ensure longer periods of consistent and subspecialized radiology services.”
On the other hand, they write, “’Work-from-home’ may increase job satisfaction and reduce stress, especially for radiologists with young children who now will also have a back-up option when caregivers are suddenly unavailable, or schools/daycares are closed during snowstorms or other unplanned events. Home PACS workstations may help radiologists extend the clinical day, which in the short-term may be necessitated by COVID-19 equipment cleaning protocols increasing the time between CT, US and MRI patients. Alternatively, working from home may place increased stress and distance between radiologists, trainees, technologists and support staff, as well as radiologists’ interactions with other clinicians. Workers in higher socioeconomic groups have been more able to stay home during the COVID-19 pandemic than workers in lower socioeconomic groups. The ready availability of this option may lead to discord/tension within the Radiology department, antagonizing technologists and other non-radiologists in the department. The onsite presence of radiologists is necessary, not only for those who consult us, but may be even more important for technologists, nurses, and residents who see radiologists as their teammates. Radiologists cannot be seen as, or act as, self-protecting elites.”
