Blurred Lines in Diagnostics Key to Cutting Costs

Over the last five years diagnostics have come under government scrutiny as healthcare costs climb at an unsustainable rate, now at 17.3% of the nations GDP.  The key driver in healthcare is mastering the ability to drive down costs through patient care models such as episodic care, ACOs and pay-for-performance.  So what’s the solution? Historically, in down markets investments are made in technologies to streamline redundant processes allowing for increased efficiencies and productivity.  These types of investments in imaging are starting to cause a paradigm shift in pathology by the manner in which pathologists review specimens; it’s no longer through a microscope, but rather an image captured by a diagnostic technology and transferred via DICOM (Digital Imaging and Communications in Medicine) to a high resolution monitor, much like a radiologists. Wait, much like a radiologists!?  The manner in which the images are also hosted and viewed are via the cloud, much like the PACS system a radiologists uses to support patient care.  Get the point? 

With the advancement of imaging technology we are seeing two medical specialties starting to merge to become one due to technological advancements. With the advances in digital pathology and molecular diagnostics and ever improving coordinated care models, traditional lines between diagnostic laboratory services and diagnostic imaging services will blur. Industry luminaries predict that we will see more change in the diagnostic industry in the next two years than we have seen in the last 20 and that providers with less than 6-8% margin will not survive.

Jeffrey Immelt, chairman and chief executive officer of General Electric, gave a keynote address at a Radiology Leadership Institute event in Evanston, Illinois. “We believe high-value diagnostics merged with radiology is a way to reduce health care costs in the long term. To that end, we are placing bets that radiology is going to merge with pathology, and, over time, we think this is the next leg of growth for you and us.” Immelt was quoted in an imagingBiz report about his speech. “I think a lot of the investment in technology has been wasted so far because we have used it for connectivity and not decision support.” Immelt recommended that radiologists invest in technology and systems that can reduce cycle times. Although any investment carries risk, he said, “People who do not assume risk are going to get hammered.”

History is once again repeating itself as healthcare information technology moves from the clinical to the administrative side of healthcare.  Savvy business owners are realizing that the biggest RISK to providers is NOT investing in a modern cloud based technology platform that is architected to be interoperable and  share information with other systems in a real time digital conversation – clinical and administrative. With the HITECH act mandating the digitization of healthcare, those stuck with 30 year old technologies like client server or ASP platforms will be left to flounder as information islands and find their technology gap resulting in an even bigger revenue gap.