Welcome to the fifth annual radiology-group survey results. A different approach in gathering information was used this year. In the past, the survey was 100% based on submissions provided by the groups themselves. This year, the Radiology Business Journal staff researched the practice market and sought out large groups, asking them to submit information. Some entries were based on information taken from the groups’ websites. The results look complete and do represent the largest 100 radiology groups owned by radiologists in the country.
In 2005, I wrote 1 about the existence of national law and accounting firms, speculating about whether national radiology groups would develop. In 2005, the correct answer would have been: not soon. Now, I wonder whether we are at a tipping point and seeing the advent of nationwide radiology groups and megagroups of 250 or more radiologists. The pressures related to decreased reimbursement, mergers, and the growth of hospitals and health systems—and the probability of payment models other than fee for service—are driving changes related to group size. As we see the number of larger groups grow, I predict that in the next five years, we will see some mergers of the largest groups in the country. It is not reflected in the survey results, but we did see the merger of Inland Imaging (Spokane, Washington) and Seattle Radiologists to create another 100-person radiology group.
The 100 largest groups represent 4,602 radiologists, and the 20 largest groups represent 1,504 radiologists. There are approximately 25,000 radiologists in private (nonacademic) practices, so it is still a very fragmented industry. In past surveys, many of the groups showed actual decreases in their numbers of radiologists. For 2012, it appears, the trend has reversed. Only three of the top 50 groups that responded in the past had decreases of more than one FTE radiologist.
We are optimistic about the future for radiology groups. Keep in mind the saying that if a business does not grow, it will die.
Thank you for your participation, Joseph P. White, CPA, MBA, Partner Clifton Larson Allen
After tracking the nation’s largest private practices for five years, we saw the benefits of scale become obvious in 2012. Volumes were relatively flat in 2011, and the median number of procedures performed dropped slightly in two of four practice-size categories. Median procedure volumes increased modestly in the smallest practice-size category (but so did its median number of FTE radiologists). Procedure volumes also increased in the largest practice cohort; its median number of radiologists actually declined, adding credence to the idea that size matters.
Other evidence that practice size could be advantageous is the direct link between size and revenue: The larger practices reported the greatest revenue per FTE radiologist, and the revenue number stepped down with each descending practice-size category. This is the first time since we launched the survey, five years ago, that this could be said.
We increased the number of practices ranked from 50 to 75 in 2011 and from 75 to 100 this year. In the past, we ranked only practices that self-reported their data. This year, we included all sizable practices; in some cases, we obtained figures for their radiologist totals from their websites. The names of those practices are printed in light blue (see table), and their rankings are likely to be undeservedly high because they are ranked by total (not FTE) radiologists.
Evidence that radiology is struggling under seven years of payors’ cost-containment efforts is the fact that, in every practice-size category except the largest, the median number of imaging centers owned declined (Figure 1). Because imaging-center operation is labor intensive, this probably contributed to a decline in FTE employees in each practice-size category (Figure 2).
Another troubling trend is that the median number of hospital contracts declined in all but the very largest practice-size cohort (Figure 3), signaling a more intense, competitive climate in the marketplace.
Survey collaborators Radiology Business Journal and CliftonLarsonAllen are pleased to welcome many new practices into the ranking this year. We made a Web-based survey available at www.imagingbiz.com from July 15 to September 20, 2012. We contacted those practices that did not fill out the survey by email and phone, asking each practice to tell us its number of FTE radiologists,