The Business of Diagnostics
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Written by Suzi Plank   
Thursday, 08 July 2004 21:38 Read : 305 times

Diagnostic procedures used by many chiropractors fall into two basic business classifications:  those that represent billable services for the doctor or clinic and those that are referred to another practitioner or facility with no financial component to the referring chiropractor.
 
Do It Yourself

In many cases of the tests or proceures that can generate billing, the chiropractor has a choice of “doing it yourself” (DIY) and providing the service in-house.  This usually represents full ownership/long-term equipment lease of equipment and the doctor or staff trained and qualified to perform the procedure.  Interpretation of the testing may also be required.  X-ray exams are a billable diagnostic procedure commonly offered in-house by chiropractors.     

Referral

The diagnostic procedures you refer out should be reviewed on a regular basis from a business management perspective.  What is your average monthly referral volume for each specific procedure?  What would your costs be in the delivery of the service?  Is the referral number high enough for you to consider providing and billing the service?  Is the procedure in the scope of practice for your licensed professionals?  Does it represent additional liability to your practice?  Is the procedure reimbursable to your practice structure by insurance plans? Would it make sense… professionally and financially?

The answers to these questions may identify revenue potential for your clinic.  Although your monthly referral average for procedures such as MRI tests may not justify the expense of operating an imaging center, the number might be sufficient to justify purchasing or leasing time at a local facility, particularly if your referral average has a steady and sufficient base.

There are usually costs involved if you plan to bill for something.  Insurance companies wonder where the value is if the test or service did not represent costs to you, in the form of time, the training and expertise necessary to provide the service or the hard costs of overhead and equipment.  The logic is, if you did not have to do anything and it did not cost you anything, then it probably isn’t worth anything in reimbursable terms to you.

Outsourcing

Outsourcing, the term and practice, has been in use by hospitals and large health care providers for years.  Outsourcing is really just hiring someone, a company, a physician, group or other entity, to provide specific services for or within your facility.  The outsource provider is hired to supply services, sometimes which may be billable by the hospital/clinic or it may represent a separate entity within the medical complex which charges for its own services, just like another store in the mall.  Radiology and laboratory services are departments that are often outsourced.   

Neurodiagnostic procedures, musculo-skeletal ultrasound, functional capacity evaluations, videofluoroscopy and nutritional testing are just a few diagnostic services many chiropractors regularly employ in their analysis and diagnosis of their patients.  These services are available as referrals, DIY and outsource.  Many of these diagnostic tests are reimbursable when billed by chiropractors.

It may be within your financial capability to purchase or lease equipment to offer these services, but who is going to operate it?  Interpretation of the data, training, certification and regular and consistent use of the equipment are significant factors that should be contemplated.

Outsourcing can be a cost effective method enabling doctors to provide more advanced diagnostic procedures without requiring large capital expenditures for equipment, staffing or training.  Contracting with an outsource provider can minimize or fix your delivery costs for these services.  There are various contract and agreement structures when using outsourced services.  However, if the service does not cost you anything in money or time, it may not represent a service that is reimbursable to you.  Additionally, an outsource provider can bring experience and knowledge to you and your staff in the necessity, application and use of the diagnostics as well as billing and collections assistance.  This support aspect supplies you a resource that can jumpstart your ability to successfully implement a revenue producing diagnostic service in your clinic.

Diagnostics are an important resource in your care of patients.  Consider the appropriate diagnostic options available, whether referral, outsource or DIY and diagnostics may represent an untapped resource for you as well. TAC

Ms. Plank has an extensive background in medical and facilities management.  During the past 15 years, Ms. Plank has provided technical and management services to healthcare providers, specializing in radiology and neurology.  She is currently the Vice President of Corporate Services for Practice Perfect.  Contact her at This e-mail address is being protected from spambots. You need JavaScript enabled to view it .


 
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