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FORUM - August 1998 FLORUM - aût 1998

Ontario Association of Radiologists launches legal action against the Ontario Medical Association

C. Ian Doris, MD, FRCPC

CAR FORUM 1998;42(4):1

© 1998 Canadian Association of Radiologists

Following a special emergency meeting on Apr. 19, 1998, in Toronto to discuss the recommendations of the Physicians Services Committee of the Ontario Medical Association (OMA) and the Ontario Ministry of Health, the Ontario Association of Radiologists (OAR) announced initiation of legal proceedings against the OMA, certain OMA directors and the Ontario government on behalf of the OAR membership. The decision to file suit followed discussions between legal counsel and the OAR executive. The reasons and background for this action are described below.


A comprehensive agreement was ratified in May 1997 between the OMA and the Ontario government. Under that agreement, a Physician Services Committee (PSC) was appointed, with representation from both the Ministry of Health and the OMA, to review utilization growth and to recommend means of maintaining it at or below agreed levels. The agreed level of utilization growth for the fiscal year 1997/98 was 1.5%, but actual overall growth exceeded this by 2.5% (i.e., $120 million).

The OMA has admitted that there are no clearly identifiable factors responsible for this growth. Possible causes include demographic changes, population growth, new medical programs and expanded use of medical technology. Increased referrals may also reflect the fact that some medical investigations were suspended during the period before the negotiation of the comprehensive agreement.

It is unfortunately true — and acknowledged by the PSC — that the data used to reach this decision were not of high quality. Opinions regarding the possible causes of increased utilization are speculative at best. It is of even more concern that the PSC has shown little interest in gathering data on and analyzing the exact causes of this utilization increase in favour of pursuing a clawback directed at selected specialties.

In addition, the decisions made to recommend cut-backs were arbitrary and taken without any substantial degree of consultation with the sections of the OMA. However, it was the serious impact of the recommendations regarding technical fees on radiologists that led to the OAR's concern and action.

Impact on technical fees

The recommendations will have the following impact on technical fees:

  1. Technical fees for diagnostic services in hospital will be subject to a growth limit of 1.5% relative to 1996/97 utilization (effective Apr. 1, 1998).
  2. Hospital billings for diagnostic services will be subject to a more aggressive audit, particularly regarding billing for diagnostic services provided in emergency departments and day care, which are paid from the Ontario Health Insurance Plan (OHIP) pool (effective Apr. 1, 1998).
  3. Technical fees associated with cardiac colour Doppler will be removed (effective June 1, 1998).
  4. Technical fees paid to private-practice clinics or independent health facilities will be subject to an unspecified claw-back, based on utilization volume.
Effects on radiologists

There is major concern about the effect of these recommendations on the imaging services delivered in independent health facilities and hospitals. There was virtually no discussion by the OMA with the Section of Diagnostic Imaging, contrary to stated OMA policy.

The technical fee recommendation has been made without any attempt to assess the impact on patient access or on other clinical specialties. Likewise, the forces driving the utilization increases have not been identified. Events such as hospital closures and mergers, addition of new programs or demographic changes have not been factored in.

Action initiated

As described above, an emergency meeting to brief radiologists was held, and Dr. William Orovan, the president-elect of the OMA, together with the OMA legal counsel, was invited to provide an overview and the rationale behind the PSC decisions and how and why they are being applied to radiologists. No substantive reason was provided, other than the view that the technical fee reduction would affect only hospitals and not radiologists. No explanation was forthcoming as to why radiology was expected to carry the burden of the $120 million claw-back. Following a closed-door discussion to which special OAR legal counsel was invited, a series of resolutions were passed unanimously by the OAR members. These resolutions authorized the OAR executive to initiate actions to the effect that the PSC recommendations are not acceptable to the radiologists of Ontario and that the OMA should be held accountable to radiologists, given its responsibility to fairly represent their interests.

Legal proceedings against the OMA and a selected group of OMA directors were initiated. The statement of claim filed on May 1, 1998, states the following:

  1. Certain recommendations of the PSC are null and void and have no binding effect on the OAR or the radiologists of Ontario.
  2. Defendant OMA directors acted in the conflict of interest and are in breach of their fiduciary duties and of their duties of skill and diligence to the radiologists of Ontario by virtue of the OMA board decision.
  3. The OMA and defendant directors are obliged to indemnify the radiologists of Ontario for any amounts by which radiologists may be prejudiced by the PSC utilization-control decision, and damages in the amount of $225 million are being claimed against the OMA for breach of duty of fair representation.
  4. Damages in the amount of $225 million are also being claimed against all individual director defendants for acting in a conflict of interest, in breach of their fiduciary duties and duties of skill and diligence.
The OAR was indirectly supported by the Ontario hospitals, since the PSC recommendations were received with horror not only by Ontario's radiologists, but also by hospital managers. The Ontario Hospital Association asked the government to delay implementation of the changes — in view of the impact on provision of patient services — until some evidence to support the proposal could be found. However, an extension was denied.

Estimated impact

Based on OHIP data, the OMA proposal will mean a reduction of approximately half a million imaging services provided to Ontario patients compared with the previous year. This figure is based on a reduction of 250,000 examinations in hospitals alone and an estimated 225,000 fewer examinations in independent health facilities. No investigation has been carried out of the potential effect of such cut-backs on the provision of services to the public. In particular, these proposals will penalize women by discouraging the increased use of mammography and bone mineral densitometry to detect breast cancer and osteoporosis, respectively. This is paradoxical, in view of the Ontario government's statements that it wants more imaging to detect disease at an earlier and treatable stage and that it wants to increase access to magnetic resonance imaging.

Response of the OMA

The OMA board of directors met via teleconference on May 3, 1998, to discuss the claim. The board unanimously passed a resolution: "that the OMA defend itself vigorously and to the full extent of the law against the legal action mounted by the Ontario Association of Radiologists." The matter is currently being examined by the OMA and its legal counsel.

OAR seeks representation separate from the OMA and terminates its involvement in the relative value schedule process

At the OAR Annual Meeting, participating radiologists unanimously supported a motion to seek representation separate from the OMA and to withdraw from the resource-based relative value schedule (RBRVS) exercise. The OAR has since taken legal steps to separate from the OMA by means of a submission to the Minister of Health. A letter has been issued to the RBRVS Commission advising it of the decision to withdraw. There has been a long-standing concern about the Ontario RBRVS process, which has been further heightened by the recent release of the draft methodology. The OAR has an American relative value schedule consultant, who assisted the American College of Radiology with its relative value schedule process in the late 1980s. The consultant reported that there were many irregularities in the proposed methodology, and that these would adversely affect radiologists' professional and technical fee compensation. A meeting with the full RBRVS Commission failed to alleviate the concerns of the OAR.

Follow-up accounts of the situation in Ontario will be included in future issues of Forum.