The number of radiologists employed by private equity firms has significantly increased over the past ten years

The landscape of radiology in the U.S. has been undergoing significant changes, with an increasing number of radiologists now working for private equity-backed entities. Research published recently revealed that approximately 12% of all radiologists in the country are employed by private equity firms, marking a substantial increase from a decade ago. This shift has been fueled by the heightened interest from investors in the radiology specialty, spurred on by the high demand and favorable reimbursement rates for imaging services.

Yashaswini Singh, a healthcare economist from Brown University, along with MD candidate Mihir Khunte, delved into these emerging trends by analyzing data from the PitchBook deals database. Their investigation uncovered that between 2013 and 2023, private equity firms acquired a total of 151 radiology practices, with a peak of 26 acquisitions in 2019. Private equity’s strategy typically involves consolidating fragmented practices within a specific geographic market to boost market share and profitability. While these acquisitions have been associated with higher prices and increased service utilization, the potential benefits of access to capital, technology investments, and operational efficiency enhancements are yet to be fully understood and explored.

The researchers meticulously verified transactions using publicly available sources such as press releases, industry reports, and practice websites, in addition to cross-referencing Medicare data. Their findings revealed that private equity acquisitions were widespread, with deals occurring in 34 states and Washington, D.C. during the study period. Leading the pack in terms of the number of acquisitions were states like Texas, Louisiana, and Florida. As of December 2023, approximately 12% of all radiologists and diagnostic radiologists were employed by private equity-backed entities, highlighting the substantial impact of this trend within the specialty.

Certain states witnessed a higher concentration of private equity-employed radiologists, with Nevada, Arizona, and Alaska ranking prominently in the study. Radiology Partners emerged as a dominant player in this realm, employing a significant proportion of radiologists nationwide. While private equity investment can potentially pave the way for increased reimbursements and investment in technology, it also brings about challenges such as shifting physician ownership, cultural changes, and heightened productivity demands, which can contribute to clinician burnout and turnover.

Further research is crucial to explore the implications of private equity involvement in radiology on healthcare delivery, patient outcomes, imaging access, and workforce dynamics. A separate study published earlier on highlighted the acquisition of numerous radiology practices and imaging centers by corporate-backed entities, underscoring the growing influence of private equity in the radiology landscape. Entities such as SimonMed Imaging, Rezolut, Solis Mammography, and others have also made strides in this space, signaling a broader trend within the specialty.