When national health solutions partner MEDNAX, Inc., announced the acquisition of vRad in May 2015, radiology market watchers wondered where the 50-state teleradiology giant would fit under its new parent’s umbrella. What led to MEDNAX’s interest in radiology? And, to get even more specific, why teleradiology?
Those questions have been answered by two recent developments.
First, MEDNAX chief executive officer Roger J. Medel, MD, laid out his overarching vision for continued growth in a presentation delivered Jan. 11 at the 35th Annual J.P. Morgan Healthcare Conference in San Francisco.
Next, less than three weeks later, MEDNAX announced its acquisition of the largest private practice radiology group in Tennessee: Radiology Alliance, PC.
A closer look at Medel’s presentation sheds light on both MEDNAX and its surefooted entry into radiology.
Perpetual pursuit of the Triple Aim
One of the surprises to come from the talk was the information regarding MEDNAX’s humble beginnings.
“My partner and I finished our training at the University of Miami, and 1980 was our first full year providing services,” Medel recalled. “At that point in time, we had one neonatal intensive care unit contract. There were two of us. We were hospital employees making $40,000 a year each, so revenues for our group that year totaled $80,000.”
Fast-forward to today: MEDNAX topped $3 billion in revenue for 2016 and employs more than 14,000 employees, including more than 7,000 clinicians. More than 220 private physician practices have joined MEDNAX over the past 20 years. And, while the company grew gradually from 1980 until now in neonatology and other pediatric subspecialties—MEDNAX now provides services to 370 neonatal ICUs in 36 states plus Puerto Rico—it entered anesthesiology in 2007 and already has more than 100 hospital contracts.
Medel cited these figures, and more, to emphasize MEDNAX’s use of big data to drive its pursuit of the Triple Aim laid out by the Institute for Healthcare Improvement (IHI).
The Triple Aim approach to optimizing health system performance suggests that providers work to improve the health status of populations while optimizing the patient experience and reducing the per capita cost of healthcare.
The company’s deep penetration in the neonatology market is unmatched. Medel explained that the company’s Clinical Data Warehouse (CDW) “…supplies us with the largest database of clinical activity and knowledge for neonatology in the world.” MEDNAX has used such data to, for example, run the largest screening program for newborns’ hearing in the country, which translates to further building of, and access to, mountains of data. Other uses have included the development of the 100,000 Babies Campaign which has improved neonatal outcomes over a 6-year span, and studies on Neonatal Abstinence Syndrome (NAS) which has reached epidemic proportions in many states.
“The point,” he added, “is that we have evolved over the 30 years in a way that helps our hospitals and our patients get the care they need.”
Radiology: the ‘next logical expansion’
“We researched and evaluated what the next logical expansion and area of growth for us was going to be, and we decided to enter the field of radiology,” he said.
MEDNAX liked that vRad had several hundred radiologists and around three-quarters of them are subspecialty-trained. The growth-minded company also liked the fact that, with more than 2,100 facilities served, vRad brings MEDNAX the world’s largest clinical database enabling radiology analytics.
“They [interpret] more than 6 million patient studies annually, and they do more studies than any other single radiology group,” Medel said, adding that vRad has the largest benchmarking platform for patient care in radiology, processes nearly 2 billion images annually on the world’s largest and most advanced Picture Archiving and Communication System (PACS).
Hybrid program broadens subspecialty coverage for hospitals
Medel hinted at the upcoming Tennessee acquisition when he discussed MEDNAX’s desire to create a hybrid radiology program that brings together the best of all worlds for hospitals availing themselves of any or all radiology services under the MEDNAX brand.
The No. 1 advantage for the hospital, Medel added, is that its patients will have access 24 hours a day to subspecialty trained radiologists, “whether it is weekends or nights or whenever. If a child shows up in the emergency room with head trauma, that head scan is going to be read by a pediatric radiologist.”
“Certainly vRad can cover weekends and nights and when people get sick, all of which is pretty easy for vRad to do, but this hybrid program is a solution we expect to grow into the field of on-the-ground radiology this year,” he said.
Medel next touched on vRad’s ability to help growth-minded radiology groups cover demand so they don’t have to hire new rads when a new hospital opportunity opens up. He described a scenario in which a practice wins a new hospital contract but can’t provide the services until it has hired additional radiologists.
With the hybrid solution, the practice doesn’t have to do that, he said, explaining that the growth-minded practice can move its radiologists to the newly won hospital immediately. And the hospital from which those radiologists moved? vRad simply draws from its deep well of subspecialist rads to cover on a temporary or even permanent basis, a solution vRad refers to as “Virtual FTE” (vFTE).
Another aspect of this model that radiology groups like “is what we call the read-along,” Medel added. “If a radiology group at a hospital all of a sudden gets seven MRI scans at 3 o’clock in the afternoon—which happens—they can say to vRad, ‘You pick up these four, I’ll take these three, and together we can provide that much quicker turnaround times for our hospital clients.’”
This same game plan applies when it comes to covering volume spikes during normal working hours so as to ensure continuous rapid-care readiness, Medel noted.
It also means MEDNAX can provide client and partner radiology practices with vRad work-from-home technology. “We can transfer all of those diagnostic images to those [radiologists’] homes,” Medel said. Radiologists on call at home overnight can support vRad growth by additionally reading for vRad if they want to.
Quality amid instability
Three weeks after Medel’s presentation, when Medel announced Radiology Alliance as the first on-site radiology group to join MEDNAX, Jason Shipman, MD, president of the practice, stated his reasons for embracing the partnership. Being a part of MEDNAX, Shipman said, “will allow Radiology Alliance to maintain and enhance our strong on-site physician footprint with our hospital partners, and also will provide the IT platform and remote technology to expand our coverage in an efficient and highly specialized manner.”
This put a fitting cap on Medel’s concluding thoughts at the presentation.
“The most important thing remains taking great care of our patients,” Medel had said in San Francisco. “There is a lot of instability in healthcare right now. There is a lot of uncertainty in terms of what’s going to happen with the Affordable Care Act. Is it going away or not going away? Regardless of all of that, we continue to believe that pursuing the Triple Aim is the right thing for us to be doing.”
Upon announcing the Radiology Alliance development, Medel underscored his enthusiasm for radiology.
“We believe the technological capabilities MEDNAX offers through vRad, combined with our own practice-management expertise and physician-centric leadership, make us an extremely valuable partner to radiology practices,” he said. “Together, Radiology Alliance and MEDNAX leadership share a common vision of becoming a recognized national leader in radiology by combining on-site radiology excellence with world-class technology, analytics and telemedicine capabilities.”