Every year, when we produce the ranking of the nation’s largest private practices, we are reminded of the contributions that radiology makes—not just to the health of the nation, but also to its economy. For a number of reasons, the profession has fostered many large and exceedingly complex organizations that employ—in the case of Radiological Associates of Sacramento in California—up to 900 people. From the interpretation of as many as 2 million procedures a year to the processing of a multitude of relatively small claims to the ownership, management, and maintenance of advanced medical technology and IT, radiology practices can be highly complex—and increasingly regulated—businesses. They employ small armies of technical, operational, and support personnel. To define a radiology practice, we begin with this: A radiology practice can be an economic force in its community. As we step farther into the pond, however, the waters become increasingly murky. When we began the rankings, five years ago, with partner CliftonLarsonAllen, we defined the private radiology practice as a PC or LLC, the traditional practice model for physicians of all types. Such companies typically distribute all earnings at the end of the year, save the amount needed to pay the January bills. Our intention was to include only those practices that performed the full range of services that a practice traditionally provided: interpretations as well as on-site consultation, special procedures, and participation in tumor boards and other medical-staff activities in the hospitals that they served. Over the intervening years, however, we have been increasingly pressed to make an absolute distinction between the private practice and the teleradiology company. As both practice models evolved, we successively refined the private-practice definition, one year specifying that a practice could not be teleradiology only, and this year requiring that the practice be wholly owned by the radiologist partners, with no outside investors. The Lines Converge The largest private practices are highly complex organizations, with many moving parts and with sizable economic impacts on their respective communities. The best of them have adopted corporate governance models and employed sharp nonphysician executive leaders to manage the financial, operational, and human-resource sides of the business. Many of these practices also operate management-services organizations (MSOs) through which they market their expertise in billing and IT. This year, we asked survey respondents whether they operated MSOs, and almost half of them said yes. While more than half of the responding practices in the largest size category acknowledged that they operated MSOs, a significant percentage of practices in each size category owned MSOs, effectively corporatizing—to some degree—these private practices. Over the past five years (the past decade, really) private practices adopted distributed reading solutions, increasingly using teleradiology to expand their geographic reach and maximize the efficiency of their subspecialized partners. During those same five years, we watched some of the largest teleradiology companies transition from nighttime-only coverage to daytime coverage, many gaining the ability to put feet on the street as they competed with private practices for hospital contracts (initially, in underserved rural areas). Some sophisticated teleradiology companies are growing through alignment with private practices: The teleradiology company provides IT infrastructure and services support and the practice provides teleradiology interpretations, in addition to providing full-service radiology to its local hospital clients. Looking Ahead Five years ago, perhaps we unconsciously exercised a bit of protectionism in excluding teleradiology companies from the ranking. The specialty appeared vulnerable, back then, with limited ability to compete with well-funded corporate entities that could speak the language of hospital administrators who were trying to cut costs. Today, the radiology marketplace is a changed place, and large practices are better equipped to compete toe-to-toe with the large teleradiology companies. In his introduction to this year’s report (page 29), Joseph P. White, CPA, MBA, postulates that we may have reached the tipping point—and (perhaps) the advent of the national radiology practice. Another article in this issue features representatives of private, academic, multispecialty, and teleradiology practices discussing the marketplace and their respective practice models (page 53), and no one disputes that teleradiology is one of them. One of the most progressive practices that I am aware of, Advanced Diagnostic Imaging, PC (Nashville, Tennessee), number 63 in this year’s ranking, just announced a joint venture with a teleradiology company that has backing from Health Evolution Partners, a private-equity company formed by David Brailer, MD, PhD, when he left his position as the first National Coordinator for Health IT to invest in the global health-care industry. What is a radiology practice? Clearly, there are many varieties of the practice, and next year, there may be even more. This year, we added a list of the eight largest radiology practices in the nation (including private, academic, and teleradiology practices), calling them the big eight. At the suggestion of publisher Curtis Kauffman-Pickelle, look for the big eight to be counted in the Radiology 100 list next year. I wish you the best of health and continued success in 2013.
What Is a Radiology Practice?