Activity-based costing in radiology. Application in a pediatric radiological unit

Purpose: To get an informative and detailed picture of the resource utilization in a radiology department in order to support its pricing and management.Material and Methods: A system based mainly on the theoretical foundations of activity-based costing (ABC) was designed, tested and compared with conventional costing. The study was performed at the Pediatric Unit of the Department of Radiology, Oulu University Hospital. The material consisted of all the 7,452 radiological procedures done in the unit during the first half of 1994, when both methods of costing where in use. Detailed cost data were obtained from the hospital financial and personnel systems and then related to activity data captured in the radiology information system.Results: The allocation of overhead costs was greatly reduced by the introduction of ABC compared to conventional costing. The overhead cost as a percentage of total costs dropped to one-fourth of total costs, from 57% to 16%. The change of unit costs of radiological procedures varied from -42% to +82%.Conclusion: Costing is much more detailed and precise, and the percentage of unspecified allocated overhead costs diminishes drastically when ABC is used. The new information enhances effective departmental management, as the whole process of radiological procedures is identifiable by single activities, amenable to corrective actions and process improvement.     

Agreement and reproducibility of subjective methods of measuring faculty time distribution

RATIONALE AND OBJECTIVES: The authors performed this study to compare self-reported estimates of the time radiology members spend performing various activities between reporting methods and academic years. MATERIALS AND METHODS: For 3 consecutive academic years, the percentage of time each faculty member reported spending on clinical, teaching, research, and service and/or administrative activities was noted on each of three separate reports: a quarterly report to department administration, an annual report to university administration, and the annual review with his or her department supervisor. For each activity, the means were compared between methods and between years. RESULTS: In general, the year-to-year changes in mean percentage for each activity and method were not statistically significant (34 of 36 comparisons). Nineteen of 36 comparisons, however, showed significant differences between reporting methods for a particular activity. For example, the mean percentages obtained with the three methods from 1999 to 2000 varied from 49% to 66% (clinical), 14% to 34% (teaching), 8% to 15% (research), and 3% to 11% (service and/or administrative). CONCLUSION: Current methods used to quantify faculty time distribution yield significantly different results despite internal consistency from year to year for each method. New and clearer methods for determining faculty time distribution are needed.     

The importance of activity-based methods in radiology and the technology that now makes this possible

Activity-based methods serve as a dynamic process that has allowed many other industries to reduce and control their costs, increase productivity, and streamline their processes while improving product quality and service. The method could serve the healthcare industry in an equally beneficial way. Activity-based methods encompass both activity based costing (ABC) and activity-based management (ABM). ABC is a cost management approach that links resource consumption to activities that an enterprise performs, and then assigns those activities and their associated costs to customers, products, or product lines. ABM uses the resource assignments derived in ABC so that operation managers can improve their departmental processes and workflows. There are three fundamental problems with traditional cost systems. First, traditional systems fail to reflect the underlying diversity of work taking place within an enterprise. Second, it uses allocations that are, for the most part, arbitrary Single step allocations fail to reflect the real work-the activities being performed and the associate resources actually consumed. Third, they only provide a cost number that, standing alone, does not provide any guidance on how to improve performance by lowering cost or enhancing throughput.     

The costs of CT procedures in an academic radiology department determined by an activity-based costing (ABC) method

PURPOSE: The purpose of this work was to determine the costs of computed tomography (CT) procedures in a large academic radiology department, including both professional (PC) and technical (TC) components, by analyzing actual resource consumption using an activity-based costing (ABC) method and comparing them with Medicare payments. METHOD: Over a 12 month period from July 1, 1996, to June 30, 1997, 1,011 CT procedures, representing 16 Physicians' Current Procedural Terminology (CPT) codes and 98.3% of CT studies performed, were carefully observed by a research assistant trained in ABC methodology. Information collected during these time and motion studies included personnel/machine time and direct materials used. Actual resource units used during the different activities in each CT procedure were valued using appropriate cost drivers. Unit values for both direct and overhead costs were calculated: the cost of an individual procedure equaled the sum of component costs. Costs were compared with PC and TC payments according to the 1997 Medicare Fee Schedule. RESULTS: Total costs of CPT codes 70450 (CT Head unenhanced), 71260 (CT Chest enhanced), and 74160 (CT Abdomen enhanced), which represented 71.2% of CT studies performed, were $189.19, $273.53, and $343.20, respectively. For all 16 nonmodified CPT codes analyzed, Medicare's professional reimbursement was less than the professional cost, whereas its technical reimbursement exceeded respective cost in 14 of the 16 codes. CONCLUSION: In the setting and time period studied, Medicare underreimbursed professional costs while overreimbursing technical costs.     

Physician assistants in academic radiology: the harborview experience

We describe a model of how physician assistants can be used in an academic medical center to expand radiologist productivity, and to enhance the departmental academic and educational missions. At Harborview Medical Center, following a training program and graduated responsibility under supervision, physician assistants provide initial interpretation of radiology studies, consultation to referring physicians, and perform less complicated interventional procedures. Acceptance of physician assistants by the radiologists, radiology residents, and referring physicians has been high. Although the impact of physician assistants on departmental clinical productivity is difficult to measure, our data suggest that radiologists are more efficient when physician assistants are assigned to service, both in terms of numbers of studies interpreted, and timeliness of reporting and billing. As a result of the success of our program, we believe that physician assistants can have an important role in radiology practice.     

The relationship of clinical and academic productivity in a university hospital radiology department

OBJECTIVE: The purpose of this study was to evaluate the relationship between clinical and academic productivity over a 2-year period in a university hospital radiology department. MATERIALS AND METHODS: Clinical productivity, as determined by the number of total professional relative value units generated, was compared with academic productivity, which was determined by the number of published peer-reviewed articles, published non-peer-reviewed articles, published abstracts, and presentations delivered by each full-time clinical faculty member. The relationships of age, academic rank, administrative position, and division within the department were also assessed for their effect on relative value units and academic productivity. RESULTS: We found a significant inverse relationship between relative value units and the number of published peer-reviewed articles, published abstracts, and presentations. Age, academic rank, and administrative responsibilities had no effect on the number of relative value units. Faculty in the neuroradiology and cardiovascular-interventional radiology divisions generated more relative value units than did other faculty members. CONCLUSION: Faculty members with higher levels of clinical productivity showed significantly lower levels of academic productivity. This finding is consistent with the idea that increases in the clinical workload may diminish research output.     

Research resources in academic radiology

Research resources in academic radiology were investigated by analyzing the responses to a survey from 72 North American institutions. The questionnaire addressed five general areas: department size, departmental resources committed to research, availability of research training, research quality control, and research productivity. The highest correlates of grant productivity included measures of departmental resources committed to research, for example, space devoted to research, size of research budget, and full-time employee support for engineers, physicists, and chemists. In a regression model, measures of the number of engineers employed by a department, the number of attending staff, and the number of training lectures given by engineers were found to be most highly associated with dollar value of grant support. The average level of research resources available at responding institutions was generally low, despite a seemingly strong desire to do quality research. This is evidenced by a strong sentiment among respondents in favor of research training and quality control of research.     

Factors associated with academic radiology research productivity

PURPOSE: To determine factors associated with research productivity among all university radiology departments in the United States. MATERIALS AND METHODS: As an observational study, this was exempt from institutional review board approval. All 47,299 radiology articles from 1996 through 2003 that were indexed in the National Library of Medicine MEDLINE database were studied. Each article was assigned a "publication impact" score based on the impact factor of its source journal. These citations were then matched, along with National Institutes of Health (NIH) extramural grant, residency, fellowship, faculty, and geographic data, to 109 individual medical school radiology departments. Raw citation count was used to measure research quantity, and aggregate publication impact was used to measure quality. Regression analyses were used to compare the relationship between the study variables and research quality and quantity measures on the departmental and individual faculty level. RESULTS: Finalized statistical models accounted for 75%-88% of variance in productivity. NIH funding had a significant and positive association with all measures of research productivity (P < .001), with one article associated with 167,980 dollars in funding and one publication impact unit associated with 83,271 dollars in funding. Large resident program sizes (P < .001) and the presence of fellows (P = .007) also had a significant association. Geographic region, salary, and faculty characteristics had no detectable association. Extrapolations based on these results estimated the cost of annual global radiology research at 907 million dollars, with the U.S. component at at least 417 million dollars. NIH funding accounted for 45% of the U.S. component. CONCLUSION: NIH funding, resident program size, and fellow characteristics are significantly associated with academic research output.     

Career advancement of men and women in academic radiology: is the playing field level?

RATIONALE AND OBJECTIVES: The authors' purposes were to determine if there are gender differences in the speed of promotion and/or academic productivity in academic radiology and if this situation had changed since a previous study was performed in 1987. MATERIALS AND METHODS: Surveys were distributed to faculty members of academic radiology departments in May 1997. A total of 707 surveys were analyzed according to gender for time at rank for assistant and associate professor levels, in relation to publication rate, grant funding rate, and distribution of professional time. RESULTS: There was no difference between genders in the time at assistant professor rank. Among all current professors, women had been associate professors longer than men, but there was no difference between genders for those who had been in academic radiology for less than 15 years. There was no gender difference at any rank in the rate of publishing original articles. There was no difference in funding rates, although men had more total grant support. Male associate professors reported spending more time in administration and slightly more time in total hours at work than did their female colleagues, and male professors spent slightly more time teaching residents. Otherwise, there is no difference in how men and women at any rank spend their professional time. There are, however, lower percentages of women in tenured positions and in the uppermost levels of departmental administration. CONCLUSION: The time at rank for men and women and their rate of publication appear to have equalized. Women still are underrepresented at the uppermost levels of departmental administration, however, and are less likely than men to hold tenured positions.     

Motivation and compensation in academic radiology

As radiologists are increasingly faced with the challenges of rising demand for imaging services and staff shortages, the implementation of incentive plans in radiology is gaining importance. A key factor to be considered while developing an incentive plan is the strategic goal of the department. In academic radiology, management should decide whether it will reward research and teaching productivity in addition to clinical productivity. Various models have been suggested for incentive plans based on (1) clinical productivity, (2) multifactor productivity, (3) individual productivity, (4) section productivity, and (5) chair’s discretion. Although fiscal rewards are most common, managers should consider other incentives, such as research time, resources for research, vacation time, and recognition awards, because academic radiologists may be motivated by factors other than financial gains.     

Radiology department management system: technologists' costs

We developed a series of management reports to compare actual costs against expected costs for radiology departments on a more detailed level than previously available. We first developed labor standards for the most commonly employed diagnostic examinations and showed that increased patient complexity (resulting from, for example, immobility, precautions status, etc.) also increased the examination times up to 2.6-fold compared with the time required for average patients. Using labor standards and budgeted and actual volumes of average and complex patients, we calculated four types of variances: volume variance, examination mix variance, patient complexity variance, and technologist efficiency variance. Monitoring the technologist efficiency variance over time could be one key piece of information for improving departmental productivity.     

Activity-based cost analysis in catheter-based angiography and interventional radiology

The aim of this study was to analyse the costs of the interventional radiology unit and to identify the cost factors in the different activities of catheter-based angiographies and interventional radiology. In 1999 the number of procedures in the interventional radiological unit at Tampere University Hospital was 2968; 1601 of these were diagnostic angiographies, 526 endovascular and 841 nonvascular interventions. The costs were analysed by using Activity Based Cost (ABC) analysis. The budget of the interventional unit was approximately 1.8 million Euro. Material costs accounted for 67%, personnel costs for 17%, equipment costs for 14% and premises costs for 2% of this. The most expensive products were endografting of aortic aneurysms, with a mean price of 5291 Euro and embolizations of cerebral aneurysms (4472 Euro). Endografts formed 87.3% of the total costs in endografting and Guglielmi detachable coils accounted for 63.3% of the total costs in embolizations. The material costs formed the majority of the costs, especially in the newest and most complicated endovascular treatments. Despite the high cost of angiography equipment, its share of the costs is minor. In our experience ABC system is suitable for analysing costs in interventional radiology.     

Promotion as a clinician educator in academic radiology departments: guidelines at three major institutions

Faculty promotion within an academic department of radiology may place emphasis on scientific research, administrative contributions, educational contributions, or a combination of all endeavors that enrich the department and further its academic mission. For those departments considering the establishment of a promotion pathway that emphasizes teaching talents and education-oriented research, the authors provide examples of three different clinician-educator faculty appointment and promotion schemes. Faculty development and defining scholarly work as a clinician-educator, as well as documentation of academic productivity within this pathway, are discussed.     

Use of productivity and financial indicators for monitoring performance in academic radiology departments: U.S. nationwide survey

PURPOSE: To determine how productivity- and finance-related indicators are used by radiology departments to evaluate departmental performance. MATERIALS AND METHODS: The study met the criteria to be exempt from institutional review board approval. All subjects were informed of the purpose of the study and that their questionnaire responses would be kept confidential. For the study, a survey was sent to 132 members of the Society of Chairmen of Academic Radiology Departments (SCARD) nationwide. The survey was designed to (a) assess organizational information about hospital and radiology departments, (b) determine the types and mean numbers of productivity and financial indicators used by radiology departments, (c) determine how these indicators are used to influence departmental productivity, and (d) assess the reference-standard goals with which each indicator value was compared. A total of 77 variables were studied. Summary statistics, Spearman rank correlation coefficient, and chi2 analyses were performed. RESULTS: The response rate was 42% (55 of 132 surveyed SCARD members). The mean number of productivity indicators used by radiology departments was 4.55 +/- 2.56 (standard deviation), while the mean number of financial indicators used was 2.89 +/- 1.99. Twenty-two (40%) of the 55 responding departments used productivity indicators to monitor and provide feedback to radiologists, hospital leaders, and technical staff members for improved productivity, but only 11 (20%) departments used these indicators to compare personnel performances against specific productivity standards. The most frequent goal (of seven [13%] responding departments) of using the indicators was to increase the examination volume from the previous year by 5%-10%. CONCLUSION: Academic radiology departments across the United States do not use a standardized set of productivity and financial indicators to measure departmental performance. Examination volume is the most frequently used productivity indicator, whereas general expenses are commonly used as indicators of financial status.     

Academic Performance–Based Compensation Models

Academic radiologists spend considerable amounts of time and effort providing nonclinical value-added services in the realms of teaching, research, and administration that are not reimbursable through traditional relative value units (RVUs) under the resource-based relative value scale. Numerous systems of academic RVUs have been proposed by medicine, surgery, and radiology programs to measure and reward these nonclinical contributions. In this article the authors (1) describe the traditional clinical RVU model of reimbursement; (2) review attempts to develop academic compensation models targeted toward research, teaching, and administration; and (3) describe possible models for academic productivity compensation.     

Postgraduate radiology training in sub-Saharan Africa: a review of current educational resources

RATIONALE AND OBJECTIVE: Postgraduate training programs in radiology exist in several African nations. The ability of these programs to train radiologists is necessarily affected by local availability of educational resources, including clinical case volume, radiology equipment and maintenance, number of teaching faculty, and library and computer facilities. We sought to determine the current resources of a sample of African radiology education programs. MATERIALS AND METHODS: Site visits were conducted at three separate radiology training programs, one in Ghana and two in South Africa. At each site, the investigator conducted a technology census, assessed library resources, observed daily trainee activities, and interviewed trainees, faculty, and statisticians. RESULTS: African radiology trainees receive considerable training in fluoroscopy, ultrasound, and plain film radiography, but receive considerably less training in nuclear medicine, mammography, magnetic resonance imaging, and interventional radiology. A large amount of equipment in African teaching hospitals is inoperative because of lack of maintenance programs. Faculty to resident ratios in African teaching hospitals are much lower than in American hospitals. Needs of training programs vary greatly from hospital to hospital, and from country to country. CONCLUSION: Radiologists, radiology organizations, and radiology vendors from high-income nations are in a unique position to help Africa's postgraduate radiology training programs fulfill their mission of training Africa's next generation of radiologists. It is desirable that long-term commitments be made to teaching hospitals so that scarce donated resources may be put to the best possible use.     

"Activity based costing" in radiology

Background: The introduction of diagnosis related groups for reimbursement of hospital services in Germany (g-drg) demands for a reconsideration of utilization of radiological products and costs related to them. Methods: Traditional cost accounting as approach to internal, department related budgets are compared with the accounting method of activity based costing (ABC). The steps, which are necessary to implement ABC in radiology are developed. Conclusions: The introduction of a process-oriented cost analysis is feasible for radiology departments. ABC plays a central role in the set-up of decentralized controlling functions within this institutions. The implementation seems to be a strategic challenge for department managers to get more appropriate data for adequate enterprise decisions. The necessary steps of process analysis can be used for other purposes (Certification, digital migration) as well.     

Practical Tips for Creating a Diversity,Equity, and Inclusion Committee: Experience From a Multicenter,Academic Radiology Department

PurposeCoronavirus disease 2019 and the publicly documented deaths of countless Black individuals have highlighted the need to confront systemic racism, address racial/ethnic disparities, and improve diversity and inclusion in radiology. Several radiology departments have begun to create diversity, equity, and inclusion (DEI) committees to systematically address DEI issues in radiology. However, there are few articles that provide departments with guidance on how to create DEI committees to comprehensively address DEI issues in radiology. The purpose of this review is to provide readers with a framework and practical tips for creating a comprehensive, institutionally aligned radiology DEI committee.MethodsThe authors describe key components of the strategic planning process and lessons learned in the creation of a radiology DEI committee, on the basis of the experience of an integrated, academic northeastern radiology department.ResultsA hospital-based strategic planning process defining the DEI vision, mission, goals, and strategies was used to inform the formation of the radiology department DEI committee. The radiology department performed gap analyses by conducting internal and external research. Strengths, weaknesses, opportunities, and threats analyses were performed on the basis of consultations with institutional and other departmental DEI leaders as well as DEI leaders from other academic medical centers. This framework served as the basis for the creation of the radiology departmental DEI committee, including a steering committee and four task forces (education, research, patient experience, and workforce development), each charged with addressing specific institutional goals and strategies.ConclusionsThis review provides academic radiology departments with a blueprint to create a comprehensive, institutionally aligned radiology DEI committee.     

Impact of COVID-19 pandemic on radiology education,training, and practice: A narrative review

Radiology education and training is of paramount clinical importance given the prominence of medical imaging utilization in effective clinical practice. The incorporation of basic radiology in the medical curriculum has continued to evolve, focusing on teaching image interpretation skills, the appropriate ordering of radiological investigations, judicious use of ionizing radiation, and providing exposure to interventional radiology. Advancements in radiology have been driven by the digital revolution, which has, in turn, had a positive impact on radiology education and training. Upon the advent of the corona virus disease 2019 (COVID-19) pandemic, many training institutions and hospitals adhered to directives which advised rescheduling of non-urgent outpatient appointments. This inevitably impacted the workflow of the radiology department, which resulted in the reduction of clinical in-person case reviews and consultations, as well as in-person teaching sessions. Several medical schools and research centers completely suspended face-to-face academic activity. This led to challenges for medical teachers to complete the radiology syllabus while ensuring that teaching activities continued safely and effectively. As a result, online teaching platforms have virtually replaced didactic face-to-face lectures. Radiology educators also sought other strategies to incorporate interactive teaching sessions while adopting the e-learning approach, as they were cognizant of the limitations that this may have on students’ clinical expertise. Migration to online methods to review live cases, journal clubs, simulation-based training, clinical interaction, and radiology examination protocolling are a few examples of successfully addressing the limitations in reduced clinical exposure. In this review paper, we discuss (1) The impact of the COVID-19 pandemic on radiology education, training, and practice; (2) Challenges and strategies involved in delivering online radiology education for undergraduates and postgraduates during the COVID-19 pandemic; and (3) Difference between the implementation of radiology education during the COVID-19 pandemic and pre-COVID-19 era.     

Productivity and quality patient care

Because of the need to control rising U.S. health care costs, managers today not only must focus on their staff and patients, but also on the business aspects of radiology, such as increasing productivity. Balancing productivity with quality patient care is not an easy task--it requires changes by the entire radiology team, including managers, technologists and radiologists. After completing this article, the reader should be able to: Discuss why health care costs continue to rise. Define productivity, how it can be measured and why it must be measured in today's health care settings. Recognize how patient satisfaction contributes to a health care organization's bottom line. Understand the health care team's role in simultaneously increasing productivity and patient satisfaction.