The 50 Largest Radiology Practices

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Why compile a list of the 50 largest radiology practices? We acknowledge that the list is far from complete, and that there may be some inconsistencies in the way that respondents answered the questions. Some radiology groups chose not to respond, and some may not have been aware that the survey was being done, so they are not included in the list. We do believe, however, that this is a pretty good start. We expect greater accuracy next year and more respondents every year. The benefits of such a survey are well understood in other fields. In the accounting world, each year, we wait for a couple of organizations to publish their annual list of the largest accounting firms in the country. I see three main benefits of this distinction.
  • It can be a source of organizational and employee pride to be able to say that you are one of the largest groups in the country.
  • It can be used as a recruiting tool for new radiologists; some will see bigger as better.
  • It can possibly be of benefit in contracting.
My interest in such a survey goes beyond mere curiosity. I have been asking the following question for a few years. If there are national and international accounting and law firms consisting of more than 2,000 owners and 20,000 employees, why are there not national radiology groups? In the past five years, we have seen the number of larger groups grow, but we really could not say, for sure, how much or how quickly. Now, we will have some method of trying to track the ebb and flow of practice size (even if it is an imperfect beginning). Both LarsonAllen and Radiology Business Journal are very aware of the sensitive nature of the revenue portion of the survey, and we will respect and guard that information closely. Thank you for participating. The 50 Largest Radiology Practices Defy Simple Categorization By Cheryl Proval When it comes to productivity, the results of the first annual survey to identify the country’s 50 largest radiology groups indicate that average revenue per FTE radiologist, in general, does bear a positive relationship with the size of the group. On the other hand, administrative challenges probably do the same, with the median number of FTE employees climbing from 57 in the groups with fewer than 35 FTE radiologists to 675 in those groups with more than 65 FTE radiologists. Overall, the results of this survey suggest a wide variety of medical business models with as many anomalies as there are commonalities, revealing a rich and multifarious practice environment. The median number of FTE radiologists for the 50 largest radiology practices is 42.5, and the median number of employees is 161. The median number of imaging centers owned matches the median number of hospital contracts: seven. Jointly sponsored by Radiology Business Journal and LarsonAllen, Minneapolis, our survey went out to the mailing list. Subsequent telephone calls were made to known groups of size to encourage their participation. Very few responses were added from these groups, however, with many citing the requirement to submit revenue data (total revenue and net operating revenue) as a cause for concern. We gave respondents the choice of granting us permission to publish the revenue data or keep them private, and most elected privacy. Ultimately, we elected to keep all revenue data private. This affected our criteria for ranking, which we initially expected to include both the number of FTE radiologists and net operating revenue. This ranking is based purely on the number of FTE radiologists, which puts the Boston academic site Brigham & Women’s Hospital at the top of the list, although its academic mission probably helps place its revenue per FTE more nearly in line with the median revenue for the groups having fewer than 35 FTE radiologists. Clearly, factors other than size appear to affect revenue per FTE; these include an academic setting, imaging center ownership, and the absence of hospital contracts. A practice that ranks near the bottom of the list that had no hospital contracts has the second-highest revenue per FTE radiologist. Discussion For purposes of analysis, we have grouped the practices into four categories: those having fewer than 35 FTE radiologists, 35 to 50 FTE radiologists, 51 to 65 FTE radiologists, and more than 65 FTE radiologists. As mentioned above, the average revenue per FTE radiologist increases with each step up in group size. Looking at the median revenue per FTE by group size, however, the 36-to-50 cohort takes a slight dip below the less-than-35 group, suggesting that true economies of scale kick in for groups of more than 50 radiologists. Because we have chosen not to share the revenue data, you will have to trust us on that. Not surprisingly, the median number of imaging centers, the number of hospitals served, and the number of procedures performed all rise along with group size, with one exception: Groups with more than 65 radiologists own fewer imaging centers than the groups of 51 to 65 radiologists. Groups with fewer than 35 FTE radiologists perform a median of 406,207 procedures, have a median of 62 employees, maintain a median of three hospital contracts, and own a median of 4.5 imaging centers. Groups with 36 to 50 FTE radiologists perform a median of 750,000 procedures, have a median of 134 FTE employees, maintain a median of six hospital contracts, and own a median of six imaging centers. Groups with 51 to 65 FTE radiologists perform a median of 800,000 procedures, have a median of 300 employees, maintain a median of 10 hospital contracts, and own a median of nine imaging centers. The largest groups, with more than 65 FTE radiologists, perform a median of 1 million procedures, have a median of 550 FTE employees, maintain a median of 13 hospital contracts, and own a median of seven imaging centers (see Figures 1 through 4).
There is, however, an inverse relationship between median revenue per FTE employee and the size category, with the smaller groups earning higher revenue per FTE employee than each successively larger group.
The largest of the groups (with more than 65 radiologists) employ small armies of staff members, ranging from as many as 846 at American Radiology Services, Baltimore, to as few as 18 at Advanced Radiology Services in Grand Rapids, Mich, which was the third largest group by FTE radiologists, but also the group that employed the fewest FTE employees. Next year, we will be much more specific in our questions to verify that, for instance, all 450 FTE employees reported by Brigham and Women’s are employed by the radiology practice and not the hospital’s radiology department. We also will specify that academic departments report only their clinical FTE radiologists and not include research FTEs.
We asked respondents to include data for the years 2007 and 2008, and although we only shared the data from 2008, a clear trend of the big getting bigger emerges. We can report that four of the 86 practices that responded have lost members, a dozen have stayed the same size, and the rest have added FTE radiologists. Of the total respondents, including the practices that did not make the 50 largest practices ranking, 46 practices provided income data. Of those, seven practices report flat revenue for 2008 over 2007 and six practices report declines in revenue, but the remainder report growth.
A total of 86 practices responded to our survey, and we regret that we were unable to include 36 practices. One midsized teleradiology company entered, which leads us to question what it is that distinguishes a practice from a teleradiology company. Several practices in the list of the largest 50 have significant teleradiology components to their businesses, but they also cover local hospitals or own imaging centers. We decided not to include teleradiology-only companies. We plan to expand this list next year to include the 100 largest radiology practices, and we welcome your thoughts on how to improve and build on this survey.