More bad news for private diagnostic facilities

Those darn private for-profit health care facilities.

You can’t locate them where you need them. You can’t tell if their doctor owners are padding their pockets with unnecessary referrals. Quality assurance is still questionable. So, the government concludes, let’s speed up the process of transferring services from hospitals to this sector.

Just weeks after a Toronto Star series highlighted the fact that nine private clinics failed to pass quality inspection and another 64 passed with conditions, the Auditor General of Ontario has issued a chapter in his 2012 report on “independent health facilities.”

The Auditor General notes that about 50 per cent of Ontario municipalities have been underserved by diagnostic services provided by these clinics and about 7 per cent have been consistently overserved from 2007-08 to 2010-11 (fiscal years).

Worse still, the Ministry indicates that many of these facility owners would like to relocate from less populated areas to more population dense locations.

Are we getting value? The Auditor General says we don’t know. Fifty per cent of these clinics (almost all for-profit) are owned or controlled by physicians, many of whom are radiologists. Yet the Ministry has not analyzed the patterns of physicians referring patients to their own facilities. Further many patients are not aware that they could in fact choose any facility or hospital providing such services.

The 2012 report does refer to a 2009 study by the Canadian Association of Radiologists that suggests as many as 30 per cent of imaging procedures across Canada contribute no useful information or are inappropriate.

Could some of this useless imaging be doctors padding their billings? In 1990 a U.S. study found that Florida doctors ordered three times as many MRIs, twice as many CTs, and five times as many ultrasounds if they owned a piece of the imaging service.

Twenty-two years later has it never dawned on Ontario to ask the same question as we cut hospital diagnostics in favour of sending more patients into this sector?

There are more than 8.8 million diagnostic services performed by these private sector facilities – more than is being performed by all Ontario hospital outpatient services.

Money spent on facility fees paid to this sector for diagnostic services is $372.6 million. If the estimates are correct, 30 per cent of that adds up to $111.78 million being spent unnecessarily.

If Ontario doctors more resemble their Florida counterparts, that figure could be much higher.

Meanwhile the Ministry contends that such services are 20 to 40 per cent less expensive if delivered by these clinics, but only has plans to expand MRIs at one such facility. Yet the funding provided by the LHINs for MRIs in hospitals is a small fraction of what we are seeing posted as the going rate for an MRI in private clinics. At present MRIs in these clinics only represent a small percentage of MRIs conducted in the province. Most continue to be provided by hospitals.

The Auditor General does question the fee schedule itself, noting it has not changed since 2006 – in fact it dropped slightly. You needn’t feel sorry for the owners of these facilities – the concern expressed by the Auditor is the Ministry is not seeing lower fees as a result of new and more efficient technology.

In 2004 the Auditor General recommended that the Ministry “objectively determine the current cost of providing each type of service and examine the relationship between the volume of services provided and the cost of providing the services.” The Ministry created a Diagnostic Services Committee to do this, but disbanded it in 2008 before this work could be completed.

In addition to concerns raised by the College of Physicians and Surgeons, the Auditor’s report also states that the Ministry’s X-ray inspection services had not inspected almost 60 per cent of facilities as frequently as required. The inspections are to ensure radiation-producing equipment is appropriately shielded to prevent staff and patients from being exposed to excessive radiation levels. The Ministry Inspection Unit was not even aware that 12 of these facilities had even moved.

The Auditor General’s report does indicate that last year the Ministry commenced a review of independent health facilities to identify questionable billing practices. The review is ongoing.

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