LaingBuisson has recently published the second edition of the UK diagnostics report which provides detailed analyses of the £8.5bn spent in the UK on imaging and laboratory diagnostics. Hugh Risebrow reports.
Consultants in private practice will typically refer 70-80% of patients they see for at least one diagnostic test.
Most radiologists and histopathologists will have income from reporting private cases and or NHS backlog cases. There are a number of facts and trends which may interest those in private practice.
Independent healthcare only accounts for 3% of pathology tests and 5% of images, as many patients have diagnostics within the NHS and elective treatment uses less diagnostics.
Private diagnostics accounts for over 15% of market value due to the much higher prices charged to medical insurance and private patients than incurred in the NHS.
There are cases where private patients can access more sophisticated diagnostics, especially genetic testing related to determining the optimum cancer treatment, where the NHS is far behind many European social health insurance funds.
By contrast, since the last Laing-Buisson Diagnostics UK Market Report three years ago, private medical insurers have anecdotally become more willing to fund tests which will, for example, avoid unnecessary chemotherapy.
The overall rate of MRI and CT scans and the number of radiologists and pathologists in the UK per capita is well below the OECD average.
The UK has the second lowest combined number of radiology/ histology consultants per 100K, and about half the median figure. CT and MRI scans are at c60% and 80% of the OECD respectively.
Interestingly, the utilisation of scans and expensive tests such as genomics in private care is much more in line with affluent countries.
The UK model of private diagnostics, especially outside London, typically involves consultants referring patients to the imaging and pathology services provided by the private hospital where they are undertaking the clinic.
UK consultants do not receive any financial benefit from this. This is very different to the model often found on the Continent, where many imaging centres and some labs – even after private equity-owned groups rolling these up – are owned by radiologists and pathologists and pay the referring consultants for their clinical input to the test.
The UK has reversed the trend in training radiologists, but demand still outstrips supply. Histopathology training places continue to go unfilled.
There is a large demand for reporting of backlog NHS histology and radiology. One key difference, with the low level of digitisation in NHS histology, is that while a growing amount of backlog radiology and night-time urgent scans can be reported overseas, very limited amounts of histology are being reported offshore.
The typical amount paid to radiologists and histologists for private patient cases – £60-£80 for an MRI, CT or simple histology case – is four to five times the amount typically paid for NHS backlog work.
While private medical insurers have driven down fees to consultants for procedures and outpatient appointments, particularly as most are now ‘fee assured’, radiologists and histologists have been relatively immune from this, possibly because the hospital charges the insurer for a reported case and the hospital usually pays the consultant.
It will be interesting to see when and whether these rates are cut – less likely while there is such a shortage of consultants.
The report looks at new technology. There has been a huge flow of private equity funds into articicial intelligence (AI), but little of this is yet impacting diagnosis. There is some use of AI in streamlining the reporting of prostate and breast biopsies.
Technologies to use AI as one of the reporters for mammograms appear close to clinical use after several years of being used to support audit. The NHS focus seems to be to use these as cost saving.
Private providers are more likely to use them to improve outcomes while retaining the use of consultants. The impact over the next three to five years is likely to be limited, but longer term it will be interesting to see how AI will support consultants.
The latest LaingBuisson Diagnostics UK Market Report looks at the short-term impact of Covid. Private investigations and procedures declined dramatically during Covid as bed capacity was initially purchased for Covid patients and the Covid guidelines reduced capacity.
Meanwhile, private labs saw their revenues more than treble and their profits grow by a factor of more than ten on the back of Covid testing, with no benefit to independent practitioners.
Covid does seem to have significantly changed consumer/ patient behaviours. We are all much more used to being tested and to sampling ourselves.
Many people have become much more aware of their health and are more interested in measurements of health and taking control of their own health.
We are also much more used to Teams meetings and hence more willing to accept virtual consultations.
Combining these factors with difficulty accessing GP appointments, we are seeing a growth in consumers purchasing diagnostic tests without a medical referral.
Typical examples are well-man/ well-woman tests as a general health check, allergy tests or patients buying PSA, thyroid function, vitamin D or other tests to monitor issues of specific concern, especially where NHS funding is limited.
There are a number of providers of these tests who either offer a postal service (Medichecks and Thriva) or access to phlebotomist (Randox and London Medical Laboratories) or both.
More recently, we are hearing about a growth in self-referred MRI and CT scans, dubbed by one provider a ‘reassurogram’.
While this may be good for the diagnostic companies, the ethics of testing without symptoms, medical history or medical referral need examining.
We also need to consider the potential impact of patients concerned about a result slightly outside of a reference range.
Direct-to-consumer testing, excluding Covid tests, without medical referral still only accounts for 5% by value of the market – <1% by volume due to much higher prices – but appears to be finally growing after a lot of false starts.
Hugh Risebrow (right) is the chief executive of healthcare consultancy Latchmore Associates, who specialise in strategic and commercial advice to private and NHS providers.
He is the non-executive chairman of Spencer Private Hospitals, a non-executive director of Digital Pathology Partners, who provide histology reporting services to the NHS, and sits on the UK advisory board of Citadel, who provide laboratory and radiology software. He was previously chief executive of Synlab UK and commercial director at Guy’s & St Thomas’ NHS Foundation Trust