At Animal Insides and DVMinsight we have consulted with dozens of radiologists considering employment at a referral hospital; and referral hospitals looking to employ radiologists. During our conversations, we have found that in order to avoid future problems and misunderstandings, employment negotiations between radiologists and referral hospitals must address issues that are unique to radiologists. We have also found that although we are able to easily define these issues, the solutions to these issues will vary depending on the expectations of the referral practice and the personality and expectations of the radiologist. This is PART 1 of a 2 part series investigating the issues surrounding the employment of radiologists at veterinary referral hospitals.
The main issue – radiologists as support staff
Radiologists are fundamentally different from other specialists at a referral hospital. While other types of specialists see patients and have a primary duty to the patient (and are able to generate income for the hospital), radiologists serve (primarily) to support the other specialists. As such, radiologists do not have their own clients or production revenues as defined in the traditional production model of compensation used at most veterinary specialty hospitals. As such, the traditional “eat what you kill” model of production largely does not apply to veterinary radiologists.
Production vs. Salary
Traditionally, specialists at referral hospitals are compensated somewhere in the range of 25% of gross revenues. All specialists should realize that this 25% number is valid because the referral hospital must shoulder the cost of the surgical equipment, surgery suite, several technicians to support the surgeon, the front desk to schedule surgeons appointments, capital investments and loan repayments, etc. Specialists often question the 25% rate but our experience is that 25% compensation is valid given the costs to support most specialists.
At the risk of belaboring this point, we feel that a 25% compensation is valid PROVIDED THAT the specialist ordering the study is compensated 25% of the study fee. For example, if a radiologist performs an ultrasound study and uses the ultrasound machine and technical staff provided by the hospital or a surgeon orders an MRI 25% of the study fee is a valid method of calculating production.
Radiologists and hospital administrators must consider that the case of interpreting radiographs is very much different than ordering an MRI and may not fit into this production model of compensation. Unfortunately, most administrators will begin negotiations with radiologists by attempting to compensate radiologist film interpretations based on a “radiologist read fee” that is applied to the radiologists gross salary. in this model, compensation is calculated at 25% of the read fee. Unfortunately, this method of compensation for film interpretations may not be valid.
Considering that there is no additional cost to hire a radiologist to interpret radiographs other than a microphone and computer, the costs to the referral hospital for employing a radiologist are significantly lower than for other specialists. Moreover, while a surgeon requires a team of support staff to perform a surgery; and an internist has a team of technicians doing call backs, submitting blood work, and talking with pet owners; the radiologist is a lone warrior reading cases. For example, if a “radiologist reading fee” is $40.00, radiologists are asked to interpret radiographic studies for about $10.00 at referral hospitals. When compared to mobile ultrasound or teleradiology, this level of compensation is not attractive to many radiologists seeking employment at referral hospitals and is not completitive with some teleradiology outlets.
Many inexperienced radiologists will accept these compensation arrangements assuming that they can work at maximum efficiency (e.g. I once read 15 cases in an hour) and assume they can work at maximum efficiency hour after hour. As such, they generally overestimate the number of films they can read and significantly overestimate their take home pay. When this happens problems arise with radiologist burnound and disatisfaction because their compensation is less than expected. Hospital administrators are advised not to take advantage of the inexperience of young radiologists during negotiations and develop a method of compensation for film reading other than the standard 25% compensation production rate.
A similar situation is often encountered when radiologists are asked to interpret CT and MRI cases. In these situations, the surgeon or internist is compensated at 25% of the cost of the MRI or CT for ordering the study while the radiologists is asked to assist with the study as it is performed, asked to troubleshoot any issues, and make sure things are in order with the study. In this situation, the surgeon or internist is compensated 25% of the cost of the MRI study, yet, the radiologist is only compensated 25% of the interpretation fee. Stated another way, the radiologists is compensated significantly less for doing significantly more work.
To overcome the fact that radiologists do not fit into the traditional production compensation scheme, referral hospitals have developed flexible-compensation schemes and others simply place radiologists on salary.
- In the flexible compensation scheme, radiologists are compensated at the normal production rate for studies such as ultrasound where the radiologist uses the machinery and support staff from the hospital. Conversely, a “set dollar amount” is negotiated for interpreting radiographs that is generally higher than the 25% of the read fee described above. Reimbursement for CT and MRI will depend on the needs of the referral hospital and can vary considerably.
- In other cases radiologists are placed on salary. Although salaried radiologists can work in some situations and with some radiologists1 the expectations from the radiologist must be clearly defined in the employment agreement. One item that must be addressed is the hours of employment. As a support service, the radiologists day (theoretically) could go on forever as they will continually be asked to do ultrasounds and look at images from emergency services, late surgeries, etc. Without clearly defining the radiologist's hours you run the risk of other specialists saying “where is that lazy radiologist? If I have to be here they have to be here” if they cannot find the radiologist. The hours of employment must also be clearly defined so radiologists do not skip out early if their work is done. With salaried employment, it is not unreasonable to ask a radiologists to stay in the building to wait for cases to walk in the door.
What about outpatient imaging?
In an effort to move the radiologists from a support role to a primary specialty service many referral hospital administrators seek to have radiologists start outpatient services at the referral hospital. This is a loser proposition.
In our experience at several referral hospitals running outpatient services and talking with several radiologists providing outpatient services at other referral hospitals, outpatient imaging is, ultimately, little more than an overflow for internal medicine, a dumping ground for cases that should go to the emergency service, and a minefield of complicated and confusing situations where the radiologist is making recommendations about treatments that might differ from the other specialists at the hospital 2
Teleradiology as a method of augmenting radiologist’s income
Unlike outpatient imaging, teleradiology is a valid method of increasing revenues to the hospital and to the radiologist. In our opinion, every referral hospital should start a teleradiology service3. Our experience is that many referring veterinarians opt for using a local teleradiology service rather than a national service.
It is also our opinion that radiologist should encourage hospital administrators to support their efforts in starting a teleradiology service as it will benefit the referral hospital and make the radiologist an indispensable part of the team of specialists at the hospital.
When considering whether or not to start a teleradiology service at your referral hospital, compensation to the radiologist should be considered. Administrators should remember that teleradiology cases take more time and commitment from the radiologist and incur even less cost to the referral hospital than in-house radiography.
Radiologists, therefore, should probably be compensated slightly higher for teleradiology cases when compared to in-house studies.
Before we leave the topic of teleradiology, another item that should be addressed in every employment agreement is whether or not radiologists are permitted to perform outside consulting with teleradiology services external to the referral hospital. In many cases referral hospitals want to “own” the radiologist and do not permit any outside consulting. It is our opinion that this is a shortsighted approach that inevitably leads to issues should the radiologist seek to augment their income. Another approach is to split the revenues from outside consulting (maybe 80/20?) such that the radiologists is encouraged to work but the enticement from outside employment is not so great that they consider leaving the referral hospital or shirk their commitment to the referral hospital.
Another topic to consider, should teleradiology be permitted under the terms of employment, is whether or not teleradiology consulting is permitted during working hours at the hospital.
Finally, if teleradiology is permitted, is there a “non-compete” radius for teleradiology cases read through an outside consulting service?
Stay tuned for part 2 of this series when we discuss turf wars, overnight coverage, and creating an enviroment where radiologists can be productive (among other topics).
NOTES
- In our experience, the most aggressive radiologists (e.g. those radiologists who do not need the inducement to productivity that traditional compensation schemes provide) will likely be working for themselves doing mobile ultrasound or running their own teleradiology services and will not be working at referral hospitals. They will also request more than you will be willing to pay them in salary.
- Although we do not support outpatient imaging at a referral hospital we do not oppose outpatient imaging in free standing imaging centers or satellite clinics. As long as a case cannot be admitted to the hospital after making a mess of the outpatient piece – outpatient imaging has a chance at working.
- We are partial to this recommendation because many referral hospitals and universities use our DVMinsight platform to run their teleradiology service. So, this is a win-win recommendation. Take it for what it is worth because it is a biased suggestion. If you would like more information about starting a teleradiology service at your referral hospital, please contact us at www.dvminsight.com
If you are a radiologist or hospital administrator who would like to talk in more detail about issues surrounding employing an in-house radiologist or you would like more information about how DVMinsight can help create a successful radiology environment at your referral practice, please contact us at www.dvminsight.com