Alternatives to Private Equity in Radiology: Staying Independent

Dr. Wen shares reasons why he and his colleagues chose to keep their practice independent. The fast-growing group spent eight years doing due diligence about private equity (PE) to decide if that was the right model for them. Dr. Wen met with PE firms around the country to explore the process of transitioning into PE practice ownership and its implications for current colleagues and future physician hires. Selling to PE would disproportionately benefit senior partners, who were ready to be bought out, over junior partners who would not qualify for the same deal. Additionally PE management could have the power to raise minimum RVU requirements and enforce highly restrictive noncompetes. Texas Radiology Associates ultimately decided that in order to compete in the radiology marketplace as an independent practice, they needed to make significant investments in technology to better serve their patients. They started to connect with Collaborative Imaging to pursue this mission.

Dhruv notes that PE has the potential to bring in financial support, strategic relationships, and pathways to growth, but he also warns the audience that not all PE contracts are transparent nor designed to benefit physicians. Workflow, staffing, and collaboration with referring doctors can be extremely difficult when firms value cost savings and RVUs over patient care. All of these stressors have negatively impacted the radiology burnout rate. Dhruv describes the start of Collaborative Imaging, in 2018, as an attempt to integrate a revenue cycle management (RCM) system with radiology workflow at Texas Radiology Associates. This provided a cost-efficient solution that frees up funds to invest in other areas of the practice. Collaborative Imaging is currently working on an AI-driven system to notify patients of actionable findings that come up in their imaging. They are also exploring technology that will adapt the style of radiology reports to different referrers’ preferences.

Both guests discuss the common inefficiencies that independent radiology practices face, including RCM, clarification over patients’ payment plans, and office wait times. Collaborative Imaging is working with practices around the country to build solutions. Radiology groups can contribute a percentage of their revenue into Collaborative Imaging and receive dividends, or they can license the RCM solution.