Specialty Diagnostic Centers: Freedom Through Managed Care

Specialty Diagnostic Centers

Freedom Through Managed Care

The RE·MEDI system includes a managed care component—a network of primary care doctors and specialists we call diagnosticians. Superficially, our diagnosticians may bear some similarity to the traditional gatekeeper, but the purpose of the diagnostician is not to restrict the patient's access to healthcare, but rather to make it possible for the patient to easily receive the information she needs to identify the best treatment values in the healthcare marketplace. Indeed, the Specialty Diagnostic Center (SDC) is the gateway to the competitive marketplace. Before entering this marketplace, the patient will receive her diagnosis and a treatment plan. She also will be presented with information on several providers, each of whom can treat her problem. Our Value Chart will enable her to readily identify her best options from which she may select the provider of her choice.

About Diagnosticians.

Diagnosticians are under contract to provide certain medical services to the TPA’s members. The primary role of a diagnostician is to diagnose his patient and prepare a written treatment plan if the patient needs further treatment. While a diagnostician may perform or order diagnostic tests, provide routine (low-cost) care, dispense medical advice and prescribe drugs, he does not normally perform any of the treatment procedures he includes in the treatment plan—unless the delay in obtaining treatment from a downstream doctor could compromise the patient's recovery.

It is helpful to view the diagnostician as a medical specialist who applies his knowledge and skills to determine the patient's illness. The required knowledge base is at least as extensive as that of many other specialties, and the skills required to determine a correct diagnosis are different from and may be as difficult to acquire as those required by the most challenging medical procedures. In short, finding the correct diagnosis can be a major obstacle to achieving a successful treatment. Most patients probably realize this already and therefore would welcome the opportunity to consult first with a diagnostic specialist before seeking treatment.

Most doctors who are selected as diagnosticians also will want to continue to treat their patients. This presents no problem since a diagnostician may treat any patient whose treatment plan has been prepared by a different diagnostician.

If a patient has medical problems that span multiple specialties, specialty diagnosticians will collaborate to determine the best course of action. In fact, there will be a treatment plan for each major diagnosed medical problem, but the specialty diagnosticians will work collaboratively. For accountability, there is always a lead specialty diagnostician designated to coordinate the efforts. He will receive all of the credit or blame for the patient's treatment costs and outcome.

Specialty diagnosticians will choose how long to spend with their patients. Perhaps the most important thing that diagnosticians do is to determine the patient's correct diagnosis expeditiously. However, this is one of several factors that may affect a diagnosticians' compensation, so they will want to allocate their time in the most cost-effective way.

Diagnosticians oversee their patients' treatments, and they confer with the treating doctors—it's a team approach that will reduce medical errors and improve recovery rates. However, it is the treating doctor who ultimately is accountable for the patient's recovery and therefore makes all final treatment decisions, including the selection of all treatment inputs. The diagnostician concept was not designed to prevent patients from being treated by specialists and receiving advanced care, as are gatekeepers in managed care plans. Rather, the objective is to determine an accurate diagnosis for the patient, and then to provide her with information to help her make a well-informed choice of treating doctor. The vigorous competition created among treating doctors will reduce prices and improve outcomes.

The separation of diagnosis from treatment is not uncommon within some managed care environments. Doctors who oversee the subsequent treatment of patients—a function performed by some medical gatekeepers—are an example of the separation of treatment from diagnosis. In addition, primary care doctors commonly refer their patients to specialists after performing a preliminary diagnosis of the patient's ailment.

Even though the separation of diagnosis is already familiar to most patients, a relatively minor change in the way that this separation is structured can lead to dramatic changes in the performance of the healthcare system as a whole, enabling most of the system's current defects to be eliminated.

The Specialty Diagnostic Center

The Specialty Diagnostic Centers (SDCs) are staffed with clinicians, primary-care physicians—including internists—and medical doctors representing most major specialties. The clinicians are used mostly for diagnosing and treating routine medical problems, though, as we shall soon see, not all routine problems are treated at the SDC.

Internists are used primarily to refer patients with a non-routine medical problem to the appropriate specialty diagnostician after performing a preliminary examination and, perhaps, obtaining the results from one or more diagnostic tests. Internists will usually treat the more complicated routine problems that appear at the SDC.

Specialty diagnosticians who have a contract with the TPA will perform most of their diagnostic work on patients referred to them by an internist at the SDC. Specialty diagnosticians may consult with other specialty diagnosticians to resolve a particularly difficult diagnosis. In other situations, one specialty diagnostician may refer the patient to another specialty diagnostician whose specialty is more appropriate for the patient's actual medical problem.

The SDC is a crucial component of the RE·MEDI system. It facilitates the separation of treatment from diagnosis. This separation will produce several major benefits, especially for non-routine medical conditions. The first major benefit is providing a gateway to the highly competitive treatment markets that the RE·MEDI system creates and to which only RE·MEDI members will have access.

A second major benefit is providing an opportunity to distribute The Doctor Shopper—and particularly its Value Chart—to members after their diagnosis has been established and their treatment plan processed. The Value Chart also causes competition among the doctors on this chart to be intense.

The third major benefit from separating treatment from diagnosis is this: the party that is providing the diagnosis is different from the party that is performing the treatment, which eliminates opportunities for self-dealing. Self-dealing occurs when a provider prescribes and then performs for profit medical procedures that are not cost-effective. However, in competitive markets, self-dealing is counterproductive, as performing treatments that are not cost-effective will make the doctor more costly and therefore less competitive.

A fourth major benefit from separating treatment and diagnosis is that two independent specialists are involved in the patient's diagnosis: the diagnostician to establish it and the treating doctor to confirm it. Thus, the patient will receive a free second opinion.

There is also a fifth major benefit. The Outcomes Index is constructed by comparing a patient's predicted outcome with her actual outcome. These results must be produced by two independent and knowledgeable sources. The Specialty diagnostician produces the predicted outcome in the form of a "prognosis rating" for the patient. The treating doctor is responsible for the patient's actual outcome.

While most medical facilities attempt to retain as many treatment opportunities as they are capable of handling, the incentives in the RE·MEDI system are just the opposite: all treatment opportunities arriving at the SDC are sent to the competitive marketplace unless it is cost-effective to administer treatment at the SDC.

The assumption is that treatments will tend to be more cost-effective if they are performed within a competitive marketplace. In fact, the only circumstances under which a treatment is likely to be more cost-effectively performed at the SDC is if the treatment can be completed during the same visit at which the diagnosis is determined. This exception will save the patient the trouble of scheduling an appointment with another doctor and keeping the appointment. It also will save her the cost of another office visit.

A patient’s diagnosis may be conditional upon a test result that has not yet been obtained. Once the diagnostician can read the test result, he may decide that it is not necessary that he see the patient again. In this case, the diagnosis, treatment plan and market information are e-mailed to the patient via secure e-mail, along with instructions on obtaining further treatment. The SDC also follows up to ensure that the patient has received treatment.

The patient will gain access to the competitive treatment market after she receives her diagnosis, a formal treatment plan and is given a list of several doctors who can treat her. This list is published in the patient’s personalized copy of The Doctor Shopper, along with the prices, outcomes and other information about these doctors. The SDC thus becomes a gateway to the competitive marketplace for well-informed patients.

expected outcome vs. actual outcome for OI; and for free second opinion.

Patient Flow Through the Specialty Diagnostic Center

The flow of patients through the SDC is illustrated in the figure below. Consider the following sequence: Examination → Diagnosis → Treatment. A member of the TPA's health plan has troubling signs or symptoms. She calls the TPA’s SDC and speaks with a clinician. If it is clear that the patient is afflicted with a routine medical condition, such as a cold or an ear infection, she can come to the Center and receive a definitive diagnosis by a qualified medical technician for the lowest copay amount. If her treatment can be completed at the SDC during the same visit, she will be treated and instructed to monitor her symptoms while she recovers. Her treatment could entail an additional cost, such as a drug prescription.

At the time of the patient's initial call to the SDC, if her signs and symptoms do not lead to a straightforward diagnosis, a clinician may feed them into a problem-knowledge coupler (PKC). This is a software program that assists with the patient's diagnosis. The PKC systematically evaluates all possible diagnoses consistent with the patient’s signs, symptoms, test results and examination. The evaluation is with reference to all of the relevant peer-reviewed medical literature, which has been pre-processed for efficiency. The PKC is designed to reduce significantly the incidence of misdiagnosis.

If the patient's condition is more complicated but still routine, she will be seen by an internist, who will complete her diagnosis, perhaps after additional testing. A visit with the internist will require a somewhat higher co-pay. Treatment will be provided by the internist if it can be completed during the same visit on which the diagnosis is completed. Otherwise, the patient will be issued a Treatment Plan Report, consisting of a cover letter, a treatment plan and The Doctor Shopper. She will be instructed to obtain treatment from the marketplace.

Finally, if during the initial contact with the SDC, the patient's problem appears more serious than a routine problem, she will be evaluated with the PKC and perhaps referred to a laboratory for some tests prior to seeing the internist. After the internist conducts a physical examination and perhaps further testing to confirm a non-routine medical condition, the internist will refer the patient to a specialty diagnostician, a medical doctor with a specialty relevant to the member’s probable medical condition. This path will require the highest co-pay, but the co-pay will cover all of the visits and tests necessary to complete the current diagnostic phase.

Using the PKC program and further testing if warranted, the member’s probable diagnosis is further narrowed. Other diagnosticians are brought in, as necessary, if a medical problem within the purview of other medical specialties is indicated. A formal treatment plan covering the first treatment phase will result from this process and entered into the TPA’s computer system. (The various treatment phases, usually associated with chronic conditions, include the stabilization, maintenance, resurgent and end phases.) Non-routine medical conditions almost always culminate with the patient receiving a treatment plan.

The treatment plan is processed through the diagnostician's computer, and the TPA’s proprietary database is searched. The search will identify several treating doctors who are able to treat the patient's condition. These are doctors who compete with each other within a free market. The computer will gather their prices, outcomes and other information, organize the results and print them out in The Doctor Shopper, which the patient can use to select a doctor for her treatment. Over the course of time, her diagnostician will prepare a separate treatment plan for each required treatment phase, as needed.

Moreover, in all cases, whether routine or non-routine, the member will be directed to self-monitor her recovery and report online any significant changes in her signs or symptoms. These symptoms will be evaluated at the SDC and, if warranted, appropriate action will be taken.

The patient is not obligated to select a treating doctor from The Doctor Shopper. In fact, she may choose any available, licensed doctor in the world for treatment without incurring an out-of-network penalty. This "generosity" on the part of the plan is possible because under Reference Pricing, the payer will pay out only a fixed amount (the reference price) irrespective of the patient's treatment choice.

The process at the Specialty Diagnostic Center is admittedly more costly than the current process, but if ineffective treatments for misdiagnosed patients can be avoided, it should more than pay for itself. The professional literature indicates that misdiagnosis is a serious medical problem. Not only may resources be wasted on treating the wrong medical condition, but the patient's well-being may be jeopardized by both the incorrect treatment and the failure to receive the proper treatment.

A recent study by the Mayo Clinic found that 88% of the time, patients received a different diagnosis, and that 21% of these patients were diagnosed with a completely different condition. [1] These are disturbing results and argue strongly that additional resources should be invested to obtain more accurate diagnoses. We fully expect that our redesigned diagnostic process, as implemented at our SDCs, will prove to be an effective investment.

Routine care is responsible for about 90% of patient visits, but it accounts for only about 30% of personal healthcare costs. The RE·MEDI system addresses both this 30% and the remaining 70% to achieve the most cost-effective results with maximum savings.


[1]Lenny Bernstein, "20 percent of patients with serious conditions are first misdiagnosed, study says." The Washington Post," April 4, 2017. [https://www.washingtonpost. com/national/health-science/20-percent-of-patients-with-serious-conditions-are-first-misdiagnosed-study- says/2017/04/03/e386982a-189f-11e7-9887-1a5314b56a08_story.html?utm_term=.dcafad03e47f cited 8/11/2017.] [Back]