Ancillary Services for Cardiology

Leslie R. Kane, MACC


November 17, 2008

In This Article


Cardiologists are branching out into ancillary services, but they are finding that while the additional services can help provide good patient care, they vary in profitability, cost, and effort involved.

"As cardiologists' income has been declining, we've seen a trend toward adding ancillary services," says Patrick White, president of MedAxiom, a cardiology practice management and information services firm in Neptune Beach, Florida. "I've seen cardiologists starting to do laser vein therapy and selling vitamins," says White. "But these are likely to divert their energies. Instead, they should focus on their core mission."

In 2007, the median total medical revenue for cardiology practices decreased 0.61%, while median operating costs increased 6.3%, according to the Medical Group Management Association's (MGMA) 2008 Cost Survey Report.

Even ancillary services that bring modest revenues can increase patient loyalty and help the bottom line, says Susan Heck, MS, Vice President of Corazon Inc., a cardiology consulting and recruitment company in Pittsburgh, PA. "Some cardiological ancillary services are not big money-makers, but they help you stay connected to your patient base, and help improve your patients' condition and lifestyle," says Heck. "If a patient is happy with his cardiologist, he's likely to stay with that doctor."

Be Strategic When Adding an Ancillary

Before bringing in a new service, cardiologists should develop a thorough business plan, advises David C. Scroggins, MBA, CPA, of Clayton L. Scroggins Associates, medical group practice management consultants in Cincinnati, Ohio. "Determine what the insurance reimbursement will be; whether you need to hire additional staff or train existing staff; and how many tests you need to do each month," he says.

Explore several financing scenarios for expensive equipment, including purchasing, leasing, and renting per-day use of a hospital's or other physician's equipment. "Changes in the law coming in October, 2009, mean leasing and renting arrangements will need additional legal analysis," says Scroggins. "Stark regulations -- which govern physician self-referral - need to be considered. It's important to look at all of these pieces to know if you can get an acceptable return on your investment."

Being savvy about integrating an ancillary service could spell the difference between a successful or a struggling service. Physicians should not just patch the new activity onto the existing workflow. Look for innovative ways to schedule services and use staff resources. "If your most highly paid clinical nurse spends an hour educating each patient, you could lose your shirt," says Heck.

Adds White, "The number one tip is to practice efficiently and develop the ability to process patients in a more cost-effective manner. You can buy all the technology you want, but without an efficient workflow, including IT solutions, a new service won't accomplish what you're aiming for."


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