Hospital and private equity (PE)-affiliated radiology practices charge more for radiologic services compared with independent practices, with hospital-based radiologists commanding the biggest fees, researchers have found.
The study results underscore the need for further research into how these trends affect radiologists, patients, and radiology practices, wrote a team led by Mihir Khunte, MD, of Warren Alpert School of Medicine of Brown University in Providence, RI. The findings were published September 2 in the Journal of the American College of Radiology.
“Understanding these pricing trends is critical for radiologists as they navigate career decisions, employment models, and contract negotiations,” Khunte and colleagues noted. “For independent radiologists, these findings highlight the competitive challenges they may face in negotiating reimbursement rates with insurers.”
Consolidation in radiology by hospitals and private equity firms has grown in recent years, yet there is little evidence regarding the prevalence of hospital and PE ownership in radiology and its association with negotiated prices for imaging services, the authors wrote.
To fill the knowledge gap, the team investigated how commercial insurance-negotiated prices for imaging services compare by practice type via an analysis of 24,783 radiologists in the U.S., categorizing them by ownership type (PitchBook data were used to identify PE practices). The group tracked professional fees for imaging services and compared them across hospital, PE-affiliated, and independent radiology practices, using linear regressions to determine any associations between each type of practice and fees paid for physician services. Of the total number of radiologists included in the research, 44% were associated with independent private practices, 41% were hospital-based, and 11% were PE-employed as of 2022.
The researchers reported the following:
- Prices for radiologic services were highest for hospital-employed radiologists — 43% higher compared to independent radiologists (p < 0.001).
- Prices for PE-affiliated practices were 15.9% higher than those for independent practices (p < 0.001).
“This difference aligns with broader health care trends whereby hospital-employed physicians tend to receive higher reimbursement rates because of hospitals’ stronger negotiating leverage with insurers,” they wrote. “The magnitude of this difference underscores the financial advantages hospitals have in payer negotiations, which may have downstream effects on reimbursement structures and radiology practice models.”
Khunte and colleagues also found that hospital-employed and PE-affiliated radiologists were concentrated in specific geographic markets, reporting that states with the highest proportions of radiologists in PE-acquired practices were Alaska (44%), Arizona (43%), and Nevada (41%), while states with the highest proportion of hospital-employed radiologists were North Dakota (90%) and South Dakota (81%). Overall, states with higher hospital affiliation rates tended to have lower PE-affiliated rates.
Differences in imaging services fees may have “long-term implications for patient care and health care costs,” according to the authors.
“Increased prices for radiologic services may contribute to higher insurance premiums and out-of-pocket costs, potentially limiting access to imaging,” they wrote. “If consolidation continues to drive price increases without clear improvements in quality or efficiency, concerns about the sustainability of health care spending will intensify. Future research should examine whether higher prices in consolidated practices correspond to improvements in service quality, patient outcomes, or access to advanced imaging technologies.”
The complete study can be found here.