Although you may not realize it, your doctor is a monopoly. Yes, you can see someone else, but not without difficulty. And if you wanted a second opinion, how far would you go? In part, through insurance coverage, in part based on a desire for convenience, healthcare is generally a local monopoly. However, that may be about to change.
I’m a radiologist, an expert in medical imaging. When I started my career in 1997, I’d show up for work and it was just me and my films. The exams presented to me were a mix of imaging- CT, MRI, ultrasound, plain X-Rays- all captured, presented and stored on film. By 2000, the film was gone. Just about everything I did was done on a computer. I was an early proponent for this technology (also know as PACS for Picture Archiving and Communications Systems). It allowed my group to work faster and smarter. However through a series of steps (consolidation, specialization and finally commoditization/globalization) technology broke up the local monopoly many radiology groups enjoyed. Similar to Instagram, PACS allowed medical images to be seen instantly by anyone anywhere. And now, based on improvements in technology, I’m expecting similar changes for the rest of healthcare.
Tele-radiology first emerged in hospitals when computers began to be used to optimize the daily workload. At the beginning of my career, several doctors divided work for the day into piles. Each person did his or her allotment with no real help from peers. With the transition to digital, work became a common pile that was shared among physicians in the same hospital. Faster doctors filled downtime gaps reading more cases, resulting in improved overall efficiency.
Such consolidation of work expanded to other operations with the development of specialized software. Take scheduling in today’s brick and mortar clinics. There are gaps when patients don’t show or an appointment ends earlier than planned. These gaps in the schedule represent lost revenue. ZocDocs, a technology start up, attempts to solve this problem by filling appointment gaps in clinical practice. Now a myriad of companies has improved a range of internal operations, starting from the same concept of consolidation.
During the next phase radiology practices realized they could improved efficiencies by sending the right case to the right person in the practice. Like the rest of medicine, radiology is highly sub specialized. For example, I am a neuroradiologist. I can generally read exams of the brain and spine faster and more accurately than radiologists who cover the whole body. Radiology groups soon realized there were advantages to having cases sent to specialists within their group rather the next available radiologist. (And—take note patients—asking for a specialist to read your imaging rather than whichever radiologist is on that day incurs no extra cost).
Step 3—Commoditization and Globalization
It wasn’t long before entrepreneurs realized that cases could be moved outside of the hospital to radiologists anywhere. At first these forward-thinking businesses limited such out-sourcing to night-time coverage (Nighthawk is the best example). However, these companies quickly expanded and now compete with local radiologists for work during the day. The larger size of these national companies often allows for better technology and more specialists. So, even though, traditionally, healthcare—including radiology— has been a local monopoly, the future is clearly going to be one of increased globalization of services based on cost and quality.
Implications for the Future of Healthcare
Telemedicine, as part of every day clinical practice, is more complicated than tele-radiology. However, over the last two decades technology has now evolved to support all forms of clinical services. Particularly for specialty services, the best care is often not the local care. And, with virtual clinic visits as close as the PDA in your pocket, I expect some of the same trends in radiology to occur for healthcare overall.
When I started my career, Kodak, the venerable producer of film for a century was near it’s peak value of 32 billion dollars. A little more than a decade later, having missed the transition to digital, Kodak was bankrupt. Change is coming. Now, video can be shared as easily as medical images. Healthcare no longer has to be local to be convenient. The patient, or more likely the patient’s insurer, will negotiate the best rates and best quality for expensive procedures and other services. This is already happening at more progressive self-insured employers such as Walmart and Lowes. For you as a patient, this is great. It should mean better care at a lower cost. For physicians and other providers, we will have to adjust or go the way of Kodak.