NightHawk Radiology: Trojan Horse or Saving Grace?

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No one has played a greater role in transforming practice patterns in radiology than Paul S. Berger, MD. As the founder and CEO of NightHawk Radiology, Coeur D’Alene, Idaho, Berger launched the company that not only dramatically improved the sleep patterns of US radiologists, but also ushered in an era of distributed reading of radiological studies from far-flung locales around the world, beginning with Sydney, Australia. Not all radiologists, however, see the ground-breaking company in a positive light. With the company’s recent purchase of St Paul Radiology’s business office, rumors persist that NightHawk is building a national radiology practice. RBJ asked Berger for his impressions of the market and where the company is headed. RBJ: When did you first know that you had a winning value proposition with NightHawk? Berger: Very shortly after our first advertising event. We sent out a card, and the card had a picture of a disheveled pseudoradiologist. It asked the question, "Who is on call tonight?" It also answered the question: "We are." We sent that out to radiologists. We hoped to get about 10 to 15 callers and we had closer to 200. We knew we were inside the tornado pretty quickly. RBJ: It appears that you are taking the organization toward a more vertically integrated model, including business services. What is the long-term vision for the company? Berger: We are a resource for radiologists and want to provide solutions for problems that they perceive to be affecting their practices, whether those solutions apply to professional interpretations, relate to business services, or involve technology solutions that we can utilize to improve their efficiency. I should mention that we are not a radiology group. All of our radiologists affiliated with NightHawk are independent contractors. What we are is the infrastructure and the operating platform that connects this widely distributed network of radiologists and hospitals in allowing the solutions that we offer to take place. RBJ: Do the benefits of being a public company outweigh the drawbacks? Berger: I would answer no. There are some advantages, such as access to capital and capital liquidity, but there also are very significant drawbacks, such as significant expenses as part of a publicly traded company, with extensive accounting and oversight rules that result in very significant expenditures towards compliance. The best example of that would probably be the Sarbanes-Oxley Act. RBJ: Some radiology groups perceive NightHawk as a threat to their practices. Can you address this concern? Berger: Simply, we are not a radiology group and we never have competed— nor will we compete—with radiologists. We should be, if we are being perceived correctly, perceived as a resource for the radiologists of this country. We have been in business for more than six years and our actions actually should indeed speak louder than our words can, and we just are there to support the radiologist. I’ve been a radiologist for over 30 years and one of the things I want to do is help support what they do. Our mission is to help transform radiology, for the betterment of patient care and the radiologists who provide that care. We are just not going to compete. RBJ: Do you believe that medical imaging is becoming commoditized? Berger: No, not at all. I do think that we, as radiologists, need to be focused on adding value, and I emphasize adding value, to the health care enterprise and patient care. We absolutely need to provide a premium-quality service that brings major value to our medical and surgical colleagues and their patients. If we don’t focus on the value added, and we don’t focus on quality, then we will become commoditized. RBJ: How can radiology groups differentiate themselves in their respective markets? Berger: We need to provide a premium-quality service, we need to latch onto and practice subspecialization as best we can, and we need to focus on efficiency and rapid turnarounds. There are things we do, as radiologists, that we don’t get paid for, especially, and that we don’t advertise, but they are critical to the health care enterprise; an example of that would be our role in radiation safety. We play a very critical and important role in radiation safety, and no one ever talks about it. We should—and, I think, must—participate in and be an essential part of the medical executive committees of our hospitals, so that we are there participating in and helping with policy development and being a part of the system. Those are the things I think we need to be doing. RBJ: Is the payor marketplace ready for a national radiology practice? Berger: I don’t know, but what I do see is increasing consolidation of radiology practices, and that, I believe, will be a part of our future. I hope that consolidation will help in future discussions with the thirdparty payors. I think the stronger we are, the louder our voice will be