interventional radiology business plan

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Here is a free business plan sample for a radiology services.

If you're a radiologist looking to establish your own practice but are unsure about the first steps to take, you've landed on the right page.

In the content that follows, we will present you with a comprehensive business plan tailored for a radiology practice.

As you might be aware, a meticulously developed business plan is crucial for any medical professional aiming to launch a successful practice. It serves as a roadmap, outlining your vision, objectives, and the strategies you plan to implement to achieve them.

To streamline the process and ensure you're on the right track, you can utilize our radiology practice business plan template. Our specialists are also available to review and refine your plan at no extra cost.

How to draft a great business plan for your radiology services?

A good business plan for a radiology practice must reflect the unique aspects of medical diagnostic services.

To start, it is crucial to provide a comprehensive overview of the healthcare market, with a focus on radiology. This includes current statistics and the identification of emerging trends in medical imaging, as illustrated in our radiology business plan template .

Your business plan should articulate your vision clearly, define your target market (such as hospitals, clinics, or private patients), and establish your practice's unique value proposition (advanced imaging technology, specialized services, tele-radiology, etc.).

The market analysis section should delve into the specifics of the radiology sector, including an assessment of local and regional competitors, technological advancements, and evolving patient needs.

For a radiology practice, it is imperative to detail the services you intend to offer, such as X-rays, MRIs, CT scans, and ultrasound, and explain how these services will meet the demands of your clientele.

The operational plan is vital and should outline the location of your practice, the layout of imaging and patient areas, partnerships with equipment suppliers, and the workflow of diagnostic procedures.

It is important to highlight the expertise of your radiologists, the quality and maintenance of imaging equipment, and adherence to medical safety standards and patient privacy regulations.

Address your marketing and patient acquisition strategies. How will you build a referral network and maintain patient relationships? Consider methods of promotion, partnerships with healthcare providers, and patient education initiatives.

Embracing digital strategies, such as an online appointment system, patient portals, and a professional website, is also crucial in the modern healthcare landscape.

The financial plan is a critical component. It should include the initial investment, revenue projections, operational expenses, and the point at which the practice will become profitable.

In radiology, the cost of advanced imaging equipment can be high, making it essential to have a precise financial plan and understand your cash flow. For assistance, refer to our financial forecast for a radiology practice .

Compared to other business plans, a radiology practice must pay special attention to regulatory compliance, certification requirements, and the integration of health information systems.

A well-crafted business plan will not only help you to define your strategies and vision but also to attract investors or secure loans.

Lenders and investors are looking for thorough market analysis, realistic financial projections, and a clear plan for day-to-day operations in a radiology practice.

By presenting a detailed and substantiated plan, you demonstrate your professionalism and dedication to the success of your practice.

To achieve these goals efficiently, you can start with our radiology business plan template .

A free example of business plan for a radiology services

Here, we will provide a concise and illustrative example of a business plan for a specific project.

This example aims to provide an overview of the essential components of a business plan. It is important to note that this version is only a summary. As it stands, this business plan is not sufficiently developed to support a profitability strategy or convince a bank to provide financing.

To be effective, the business plan should be significantly more detailed, including up-to-date market data, more persuasive arguments, a thorough market study, a three-year action plan, as well as detailed financial tables such as a projected income statement, projected balance sheet, cash flow budget, and break-even analysis.

All these elements have been thoroughly included by our experts in the business plan template they have designed for a radiologist .

Here, we will follow the same structure as in our business plan template.

Market Opportunity

Market data and figures.

The radiology sector is an integral part of the healthcare industry, with its importance growing alongside advances in medical imaging technology.

Recent estimates value the global radiology market at over 25 billion dollars, with projections indicating continued growth due to the increasing need for diagnostic and interventional imaging services.

In the United States, there are over 30,000 radiologists, contributing to a significant portion of healthcare expenditures. The demand for radiological services reflects the critical role imaging plays in diagnosis, treatment planning, and monitoring of various diseases.

These figures underscore the vital position of radiology in modern medicine and its substantial economic impact.

The radiology field is experiencing several key trends that are shaping its future.

Artificial intelligence (AI) and machine learning are becoming increasingly prevalent, with algorithms assisting in image analysis, improving diagnostic accuracy, and streamlining workflows.

Tele-radiology services are expanding, allowing for remote interpretation of medical images, which increases access to expert diagnostics regardless of location.

There is also a growing emphasis on minimally invasive procedures, with interventional radiology offering alternatives to traditional surgery, which can lead to quicker recovery times and less risk for patients.

Furthermore, patient-centered care is gaining attention, with a focus on improving the patient experience during imaging procedures and ensuring clear communication of results.

Advancements in imaging technology, such as higher-resolution MRI and CT scanners, are enabling more detailed and accurate assessments of medical conditions.

These trends demonstrate the dynamic nature of the radiology field and its adaptation to technological advancements and patient needs.

Success Factors

Several factors contribute to the success of a radiology practice.

First and foremost, diagnostic accuracy is paramount. A practice known for reliable and precise imaging results will build a strong reputation among referring physicians and patients.

Investment in state-of-the-art imaging technology is also critical, as it can improve diagnostic capabilities and patient comfort.

The location and accessibility of the radiology practice can influence patient choice, with convenient locations being more attractive.

Exceptional patient care, including respectful treatment, clear communication, and minimal wait times, is essential for patient satisfaction and retention.

Lastly, efficient practice management, including effective cost control, billing practices, and adaptation to regulatory changes, is vital for the financial health and sustainability of a radiology practice.

The Project

Project presentation.

Our radiology clinic project is designed to address the essential need for high-quality diagnostic imaging services. Situated in a location with easy access for patients, including those referred by nearby medical practices or hospitals, our clinic will be equipped with state-of-the-art imaging technology. We will offer a comprehensive range of services, including X-rays, MRI, CT scans, ultrasound, and mammography, all performed by certified radiologists and skilled technicians.

The emphasis will be on patient comfort, accurate diagnostics, and timely reporting to ensure effective treatment planning.

Our radiology clinic aims to become a trusted center for medical imaging, contributing to the timely and accurate diagnosis of health conditions, thereby enhancing patient care and treatment outcomes.

Value Proposition

The value proposition of our radiology clinic lies in providing precise and reliable diagnostic imaging services that are crucial for the accurate diagnosis and treatment of medical conditions.

Our commitment to utilizing advanced imaging technology and providing a comfortable patient experience ensures high-quality care. We offer a seamless service that includes quick appointment scheduling, minimal wait times, and rapid, clear communication of results to both patients and referring physicians.

We are dedicated to creating a supportive environment where patients receive the care they need with the utmost respect for their comfort and time, and we aim to educate our patients about the importance and benefits of timely diagnostic imaging.

Our clinic aspires to be a cornerstone in the healthcare community, offering dependable imaging services that contribute to the overall health and well-being of our patients.

Project Owner

The project owner is a board-certified radiologist with a passion for patient care and a deep understanding of diagnostic imaging's role in modern medicine.

With years of experience in both clinical and administrative aspects of radiology, the owner is committed to establishing a clinic that stands out for its excellence in patient care, cutting-edge technology, and efficient service.

With a vision of integrating the latest advancements in radiological science, the owner is determined to provide top-tier imaging services that aid in the accurate diagnosis and treatment of patients, while also contributing to the education and advancement of the field.

Driven by a commitment to medical excellence and compassionate care, the project owner is the guiding force behind the clinic, striving to enhance the health and quality of life of the community through superior radiological services.

The Market Study

Market segments.

The market segments for a radiology practice are diverse and cater to various needs within the healthcare system.

Firstly, there are patients referred by primary care physicians for diagnostic imaging to investigate symptoms or monitor existing conditions.

Secondly, specialists such as orthopedic surgeons, oncologists, and cardiologists require detailed imaging to plan and evaluate treatments.

Additionally, there is a segment of the market that includes health-conscious individuals seeking preventive screening services to stay ahead of potential health issues.

Lastly, medical facilities and hospitals may outsource radiology services, representing a significant segment for partnerships and collaborations.

SWOT Analysis

A SWOT analysis of a radiology practice highlights several key factors.

Strengths include advanced imaging technology, a team of skilled radiologists, and a strong reputation for accurate and timely diagnoses.

Weaknesses might encompass the high cost of maintaining cutting-edge equipment and the need for continuous professional development to keep up with medical advancements.

Opportunities can be found in the growing demand for diagnostic services due to an aging population and the rise in chronic diseases, as well as the potential for offering tele-radiology services.

Threats could involve regulatory changes, increasing competition from large healthcare providers, and cybersecurity risks associated with patient data.

Competitor Analysis

Competitor analysis in the radiology sector indicates a mix of competition.

Direct competitors include other local radiology practices, hospital imaging departments, and larger radiology chains.

These entities compete on the basis of service quality, turnaround times for reports, patient experience, and technological advancements.

Identifying competitive advantages such as specialized services, strategic partnerships with medical providers, and superior patient care is crucial for standing out in the market.

Understanding the strengths and weaknesses of competitors is vital for carving out a niche and ensuring patient loyalty.

Competitive Advantages

Our radiology practice's competitive edge lies in our state-of-the-art imaging technology and our team's expertise in delivering precise diagnoses.

We offer a comprehensive suite of imaging services, including MRI, CT scans, ultrasound, and X-rays, ensuring that patients have access to the best diagnostic tools.

Our commitment to patient education and comfort sets us apart, as we provide clear explanations of procedures and results, helping patients feel informed and at ease.

We also prioritize rapid report turnaround and seamless communication with referring physicians, which enhances the overall healthcare experience and builds trust in our services.

You can also read our articles about: - how to offer radiology services: a complete guide - the customer segments of a radiology services - the competition study for a radiology services

The Strategy

Development plan.

Our three-year development plan for the radiology practice is designed to establish us as a leader in diagnostic imaging services.

In the first year, we will concentrate on building a strong local presence, investing in state-of-the-art imaging technology, and ensuring exceptional patient care.

The second year will focus on expanding our services to include tele-radiology and forming partnerships with local clinics and hospitals to increase our service offerings.

In the third year, we aim to specialize further by incorporating advanced imaging techniques such as 3D mammography and MRI-guided biopsies, and by exploring opportunities for research and development in diagnostic imaging.

Throughout this period, we will be dedicated to continuous improvement, patient satisfaction, and maintaining the highest standards of radiological practice.

Business Model Canvas

The Business Model Canvas for our radiology practice targets individuals in need of diagnostic imaging as well as healthcare providers looking for expert radiological services.

Our value proposition is centered on providing accurate, timely, and patient-friendly radiology services using cutting-edge technology.

We offer our services through direct patient appointments and partnerships with healthcare providers, utilizing our key resources such as advanced imaging equipment and a team of skilled radiologists.

Key activities include performing diagnostic procedures, interpreting images, and consulting with referring physicians.

Our revenue streams arise from patient fees, insurance reimbursements, and contracts with healthcare institutions, while our costs are associated with equipment, personnel, and facility operations.

Find a complete and editable real Business Model Canvas in our business plan template .

Marketing Strategy

Our marketing strategy is focused on building relationships and trust within the medical community.

We aim to educate both patients and healthcare providers about the benefits and advancements in radiological services, emphasizing the quality and precision of our diagnostics.

Our approach includes professional referrals, participation in medical conferences, and the use of digital platforms to share educational content about radiology.

We will also develop partnerships with medical device companies to stay at the forefront of technology.

Finally, we will leverage social media and professional networking to enhance our visibility and reputation in the field.

Risk Policy

The risk policy of our radiology practice is designed to mitigate risks associated with diagnostic imaging, patient data security, and regulatory compliance.

We adhere to strict radiation safety standards and privacy laws, ensuring the protection of patient information and the safe use of imaging equipment.

Regular equipment maintenance and staff training are conducted to uphold the quality of our services. Additionally, we implement a conservative financial management strategy to maintain fiscal health.

We also carry comprehensive liability insurance to cover any potential professional liability claims. Our priority is to provide top-tier radiology services while safeguarding the well-being and privacy of our patients.

Why Our Project is Viable

We envision establishing a radiology practice that meets the growing demand for high-quality diagnostic imaging services.

With our commitment to technological advancement, patient care, and professional excellence, we are confident in our ability to thrive in the healthcare sector.

We are excited about the opportunity to enhance patient outcomes and contribute to the advancement of medical diagnostics.

We remain adaptable to the evolving healthcare landscape and look forward to the successful future of our radiology practice.

You can also read our articles about: - the Business Model Canvas of a radiology services - the marketing strategy for a radiology services

The Financial Plan

Of course, the text presented below is far from sufficient to serve as a solid and credible financial analysis for a bank or potential investor. They expect specific numbers, financial statements, and charts demonstrating the profitability of your project.

All these elements are available in our business plan template for a radiologist and our financial plan for a radiologist .

Initial expenses for our radiology clinic include acquiring advanced medical imaging equipment such as MRI and CT scanners, outfitting the clinic to meet healthcare regulations and patient comfort standards, purchasing necessary computer systems for image processing and storage, obtaining licenses and certifications, and investing in professional development for our radiologists to ensure they are up-to-date with the latest diagnostic techniques. Additionally, costs will be allocated for brand development and targeted marketing strategies to establish our presence in the healthcare market.

Our revenue assumptions are based on a thorough analysis of the local demand for diagnostic imaging services, taking into account factors such as the aging population, the prevalence of chronic diseases, and the need for advanced diagnostic capabilities.

We anticipate a steady increase in patient referrals, beginning conservatively and expanding as our reputation for high-quality radiological services grows.

The projected income statement outlines expected revenues from our imaging services, operational costs (equipment maintenance, labor, utilities), and administrative expenses (rent, marketing, salaries, insurance, etc.).

This results in a forecasted net profit that is essential for assessing the long-term viability of our radiology clinic.

The projected balance sheet presents assets unique to our clinic, such as medical imaging equipment, computer hardware, and software for image analysis, and liabilities including loans and projected operational costs.

It provides a snapshot of the financial standing of our radiology clinic at the conclusion of each fiscal period.

Our projected cash flow statement details the inflows and outflows of cash, enabling us to predict our financial requirements at any point in time. This is crucial for maintaining a healthy financial status and preventing liquidity issues.

The projected financing plan identifies the specific sources of funding we intend to utilize to cover our initial costs, such as bank loans, leasing options for equipment, or potential investors.

The working capital requirement for our radiology clinic will be meticulously managed to ensure we have sufficient funds to support our day-to-day operations, including equipment purchases, inventory management, and payroll.

The break-even analysis for our clinic will determine the volume of services required to offset all our costs, including initial investments, and begin generating profits.

It will signal the point at which our clinic becomes financially sustainable.

Key performance indicators we will monitor include the utilization rate of our imaging equipment, the average revenue per diagnostic procedure, the patient satisfaction score to gauge service quality, and the return on investment to evaluate the efficiency of our capital expenditures.

These metrics will assist us in measuring the financial performance and overall success of our radiology clinic.

If you want to know more about the financial analysis of this type of activity, please read our article about the financial plan for a radiology services .

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The interventional radiology business plan

Affiliation.

• 1 Department of Radiology, University of Arkansas for Medical Sciences, Little Rock, AR 72205, USA. [email protected]
• PMID: 22841900
• DOI: 10.1016/j.jvir.2012.05.044

Strategic planning and business planning are processes commonly employed by organizations that exist in competitive environments. Although it is difficult to prove a causal relationship between formal strategic/business planning and positive organizational performance, there is broad agreement that formal strategic and business plans are components of successful organizations. The various elements of strategic plans and business plans are not common in the vernacular of practicing physicians. As health care becomes more competitive, familiarity with these tools may grow in importance. Herein we provide an overview of formal strategic and business planning, and offer a roadmap for an interventional radiology-specific plan that may be useful for organizations confronting competitive and financial threats.

Copyright © 2012 SIR. Published by Elsevier Inc. All rights reserved.

Publication types

• Competitive Behavior
• Economic Competition
• Efficiency, Organizational
• Health Care Costs
• Marketing of Health Services / organization & administration
• Models, Organizational
• Planning Techniques
• Practice Management, Medical / organization & administration
• Radiography, Interventional* / economics
• Radiology, Interventional / economics
• Radiology, Interventional / organization & administration*

How to write a business plan for a radiology center?

Creating a business plan for a radiology center is an essential process for any entrepreneur. It serves as a roadmap that outlines the necessary steps to be taken to start or grow the business, the resources required, and the anticipated financial outcomes. It should be crafted with method and confidence.

This guide is designed to provide you with the tools and knowledge necessary for creating a radiology center business plan, covering why it is so important both when starting up and running an established business, what should be included in your plan, how it should be structured, what tools should be used to save time and avoid errors, and other helpful tips.

We have a lot to cover, so let's get to it!

In this guide:

Why write a business plan for a radiology center?

What information is needed to create a business plan for a radiology center.

• What goes in the financial forecast for a radiology center?
• What goes in the written part of a radiology center business plan?
• What tool can I use to write my radiology center business plan?

Being clear on the scope and goals of the document will make it easier to understand its structure and content. So before diving into the actual content of the plan, let's have a quick look at the main reasons why you would want to write a radiology center business plan in the first place.

To have a clear roadmap to grow the business

It's rarely business as usual for small businesses. The economy follows cycles where years of growth are followed by recessions, and the business environment is always changing with new technologies, new regulations, new competitors, and new consumer behaviours appearing all the time...

In this context, running a business without a clear roadmap is like driving blindfolded: it's dangerous at best. That's why writing a business plan for a radiology center is essential to create successful and sustainable businesses.

To write an effective business plan, you will need to take stock of where you are (if you are already in business) and where you want the business to go in the next three to five years.

Once you know where you want your radiology center to be, you'll have to identify:

• what resources (human, equipment, and capital) are needed to get there,
• at what pace the business needs to progress to get there in time,
• and what risks you'll face along the way.

Going through this process regularly is beneficial, both for startups and existing companies, as it helps make informed decisions about how best to allocate resources to ensure the long-term success of the business.

To maintain visibility on future cash flows

Businesses can go for years without making a profit, but they go bust as soon as they run out of cash. That's why "cash is king", and maintaining visibility on your radiology center's future cash flows is critical.

How do I do that? That's simple: you need an up-to-date financial forecast.

The good news is that your radiology center business plan already contains a financial forecast (more on that later in this guide), so all you have to do is to keep it up-to-date.

To do this, you need to regularly compare the actual financial performance of your business to what was planned in your financial forecast, and adjust the forecast based on the current trajectory of your business.

Monitoring your radiology center's financial health will enable you to identify potential financial problems (such as an unexpected cash shortfall) early and to put in place corrective measures. It will also allow you to detect and capitalize on potential growth opportunities (higher demand from a given segment of customers for example).

To secure financing

Whether you are a startup or an existing business, writing a detailed radiology center business plan is essential when seeking financing from banks or investors.

This makes sense given what we've just seen: financiers want to ensure you have a clear roadmap and visibility on your future cash flows.

Banks will use the information included in the plan to assess your borrowing capacity (how much debt your business can support) and your ability to repay the loan before deciding whether they will extend credit to your business and on what terms.

Similarly, investors will review your plan carefully to assess if their investment can generate an attractive return on investment.

To do so, they will be looking for evidence that your radiology center has the potential for healthy growth, profitability, and cash flow generation over time.

Now that you understand why it is important to create a business plan for a radiology center, let's take a look at what information is needed to create one.

Writing a radiology center business plan requires research so that you can project sales, investments and cost accurately in your financial forecast.

In this section, we cover three key pieces of information you should gather before drafting your business plan!

Carrying out market research for a radiology center

As you consider writing your business plan for a radiology center, conducting market research becomes a vital step to ensure accurate and realistic financial projections.

Market research provides valuable insights into your target customer base, competitors, pricing strategies, and other key factors that can significantly impact the commercial success of your business.

Through this research, you may uncover trends that could influence your radiology center.

1. Your radiology center may experience an increase in demand for telemedicine services, as more patients become comfortable with virtual care. 2. Market research may reveal that your center could have more success by targeting specific demographics, such as seniors or families with young children.

Such market trends play a significant role in forecasting revenue, as they offer valuable data about potential customers' spending habits and preferences.

By incorporating these findings into your financial projections, you can present investors with more accurate information, helping them make informed decisions about investing in your radiology center.

Developing the marketing plan for a radiology center

Before delving into your radiology center business plan, it's imperative to budget for sales and marketing expenses.

To achieve this, a comprehensive sales and marketing plan is essential. This plan should provide an accurate projection of the necessary actions to acquire and retain customers.

Additionally, it will outline the required workforce to carry out these initiatives and the corresponding budget for promotions, advertising, and other marketing endeavours.

By budgeting accordingly, you can ensure that the right resources are allocated to these vital activities, aligning them with the sales and growth objectives outlined in your business plan.

The staffing and capital expenditure requirements of a radiology center

Whether you are starting or expanding a radiology center, it is important to have a clear plan for recruitment and capital expenditures (investment in equipment and real estate) in order to ensure the success of the business.

Both the recruitment and investment plans need to be coherent with the timing and level of growth planned in your forecast, and require appropriate funding.

A radiology center might incur staffing costs such as salaries for radiologists, radiologic technologists, and administrative staff. They may also incur costs for equipment such as X-ray machines, CT scanners, and MRI machines. Additionally, they may need to purchase other supplies such as contrast mediums, gloves, and gowns.

In order to create a realistic financial forecast, you will also need to consider the other operating expenses associated with running the business on a day-to-day basis (insurance, bookkeeping, etc.). 

Once you have all the necessary information to create a business plan for your radiology center, it is time to start creating your financial forecast.

What goes into your radiology center's financial forecast?

The financial forecast of your radiology center will enable you to assess the profitability potential of your business in the coming years and how much capital is required to fund the actions planned in the business plan.

The four key outputs of a financial forecast for a radiology center are:

• The profit and loss (P&L) statement ,
• The projected balance sheet ,
• The cash flow forecast ,
• And the sources and uses table .

Let's take a closer look at each of these.

The projected P&L statement

Your radiology center forecasted P&L statement enables the reader of your business plan to get an idea of how much revenue and profits your business is expected to make in the near future.

Ideally, your reader will want to see:

• Growth above the inflation level
• Expanding profit margins
• Positive net profit throughout the plan

Expectations for an established radiology center will of course be different than for a startup. Existing businesses which have reached their cruising altitude might have slower growth and higher margins than ventures just being started.

The projected balance sheet of your radiology center

Your radiology center's forecasted balance sheet enables the reader of your plan to assess your financial structure, working capital, and investment policy.

It is composed of three types of elements: assets, liabilities and equity:

• Assets: represent what the business owns and uses to produce cash flows. It includes resources such as cash, equipment, and accounts receivable (money owed by clients).
• Liabilities: represent funds advanced to the business by lenders and other creditors. It includes items such as accounts payable (money owed to suppliers), taxes due and loans.
• Equity: is the combination of what has been invested by the business owners and the cumulative profits and losses generated by the business to date (which are called retained earnings). Equity is a proxy for the value of the owner's stake in the business.

Your radiology center's balance sheet will usually be analyzed in conjunction with the other financial statements included in your forecast.

Two key points of focus will be:

• Your radiology center's liquidity: does your business have sufficient cash and short-term assets to pay what it owes over the next 12 months?
• And its solvency: does your business have the capacity to repay its debt over the medium-term?

The cash flow forecast

A projected cash flow statement for a radiology center is used to show how much cash the business is generating or consuming.

The cash flow forecast is usually organized by nature to show three key metrics:

• The operating cash flow: do the core business activities generate or consume cash?
• The investing cash flow: how much is the business investing in long-term assets (this is usually compared to the level of fixed assets on the balance sheet to assess whether the business is regularly maintaining and renewing its equipment)?
• The financing cash flow: is the business raising new financing or repaying financiers (debt repayment, dividends)?

As we discussed earlier, cash is king and keeping an eye on future cash flows an imperative for running a successful business. Therefore, you can expect the reader of your radiology center business plan to pay close attention to your cash flow forecast.

Also, note that it is customary to provide both yearly and monthly cash flow forecasts in a business plan - so that the reader can analyze seasonal variation and ensure the radiology center is appropriately funded.

The initial financing plan

The initial financing plan - also called a sources and uses table - is an important tool when starting a radiology center.

It shows where the money needed to set up the business will come from (sources) and how it will be allocated (uses).

Having this table helps understand what costs are involved in setting up the radiology center, how the risks are distributed between the shareholders and the lenders, and what will be the starting cash position (which needs to be sufficient to sustain operations until the business breaks even).

Now that the financial forecast of a radiology center business plan is understood, let's focus on what goes into the written part of the plan.

The written part of a radiology center business plan

The written part of a radiology center business plan is composed of 7 main sections:

• The executive summary
• The presentation of the company
• The products and services
• The market analysis
• The strategy
• The operations
• The financial plan

Throughout these sections, you will seek to provide the reader with the details and context needed for them to form a view on whether or not your business plan is achievable and your forecast a realistic possibility.

Let's go through the content of each section in more detail!

1. The executive summary

The first section of your radiology center's business plan is the executive summary which provides, as its name suggests, an enticing summary of your plan which should hook the reader and make them want to know more about your business.

When writing the executive summary, it is important to provide an overview of the business, the market, the key financials, and what you are asking from the reader.

Start with a brief introduction of the business, its name, concept, location, how long it has been in operation, and what makes it unique. Mention any services or products you plan to offer and who you sell to.

Then you should follow with an overview of the addressable market for your radiology center, current trends, and potential growth opportunities.

You should then include a summary of your key financial figures such as projected revenues, profits, and cash flows.

Finally, you should detail any funding requirements in the ask section.

2. The presentation of the company

The second section in your radiology center's business plan should focus on the structure and ownership, location, and management team of the company.

The structure and ownership part provides an overview of the legal structure of the business, who the owners are and how much each has invested and owns. If you are seeking financing it is important that the reader gets a clear picture of which legal entity is receiving the funds, and who controls the business.

The location part should give an overview of the premises from which the company is operating, and why that location is of particular interest (catchment area, accessibility, amenities nearby, etc.).

When describing the location of your radiology center, you could emphasize the area's potential for growth. It may be in a location with a growing population, and the area may be experiencing increased demand for healthcare services. You might also focus on the potential for success from being in a convenient location with excellent access to transportation and other existing medical services. By highlighting the potential that the location has to offer, you could make a compelling argument for why this is a great opportunity for an investor.

Finally, you should introduce the management team. Explain each member's role, background, and experience.

It is also important to emphasize any past successes that the members of the management team have achieved, and how long they've been working together, as this will help potential lenders or investors understand why they should trust in their leadership.

3. The products and services section

The products and services section of your radiology center business plan should include a detailed description of what your company sells to its customers. 

For example, your radiology center might offer a variety of imaging services, such as x-rays, CT scans, and ultrasounds. These services provide physicians with detailed images of patients' internal organs and structures, allowing for accurate diagnosis and treatment of illnesses. Additionally, your center might offer interventional radiology procedures, such as biopsies and stent placements, which utilize imaging techniques to perform minimally invasive treatments. Finally, your center could provide ancillary services, such as physical therapy, occupational therapy, and pain management, to further help patients manage their conditions.

The reader will want to understand what makes your radiology center unique from other businesses in this competitive market.

When drafting this section, you should be precise about the categories of products or services you sell, the clients you are targeting and the channels that you are targeting them through. 

4. The market analysis

When outlining your market analysis in the radiology center business plan, it's essential to include comprehensive details about customers' demographics and segmentation, target market, competition, barriers to entry, and relevant regulations.

The primary aim of this section is to give the reader an understanding of the market size and appeal while demonstrating your expertise in the industry.

To begin, delve into the demographics and segmentation subsection, providing an overview of the addressable market for your radiology center, key marketplace trends, and introducing various customer segments and their preferences in terms of purchasing habits and budgets.

Next, shift your focus to the target market subsection, where you can zoom in on the specific customer segments your radiology center targets. Explain how your products and services are tailored to meet the unique needs of these customers.

For example, your target market might include patients who need to have regular scans done due to a chronic medical condition. This could include patients with cancer, multiple sclerosis, or other diseases that require regular imaging to monitor their health. Additionally, these customers may have a long history with the radiology center, as they need to come back for regular checkups and scans.

In the competition subsection, introduce your main competitors and explain what sets your radiology center apart from them.

Finally, round off your market analysis by providing an overview of the main regulations that apply to your radiology center.

5. The strategy section

When writing the strategy section of a business plan for your radiology center, it is essential to include information about your competitive edge, pricing strategy, sales & marketing plan, milestones, and risks and mitigants.

The competitive edge subsection should explain what sets your company apart from its competitors. This part is especially key if you are writing the business plan of a startup, as you have to make a name for yourself in the marketplace against established players.

The pricing strategy subsection should demonstrate how you intend to remain profitable while still offering competitive prices to your customers.

The sales & marketing plan should outline how you intend to reach out and acquire new customers, as well as retain existing ones with loyalty programs or special offers. 

The milestones subsection should outline what your company has achieved to date, and its main objectives for the years to come - along with dates so that everyone involved has clear expectations of when progress can be expected.

The risks and mitigants subsection should list the main risks that jeopardize the execution of your plan and explain what measures you have taken to minimize these. This is essential in order for investors or lenders to feel secure in investing in your venture.

Your radiology center could face the risk of technological failure. For example, if the computers or software used to manage patient information or run imaging tests were to malfunction, this could lead to delays in service and potential data loss. In addition, your radiology center could be vulnerable to cyber security risks. For example, hackers may try to gain access to patient information or the imaging equipment, and this could lead to data breaches and other security issues.

6. The operations section

The operations of your radiology center must be presented in detail in your business plan.

The first thing you should cover in this section is your staffing team, the main roles, and the overall recruitment plan to support the growth expected in your business plan. You should also outline the qualifications and experience necessary to fulfil each role, and how you intend to recruit (using job boards, referrals, or headhunters).

You should then state the operating hours of your radiology center - so that the reader can check the adequacy of your staffing levels - and any plans for varying opening times during peak season. Additionally, the plan should include details on how you will handle customer queries outside of normal operating hours.

The next part of this section should focus on the key assets and IP required to operate your business. If you depend on any licenses or trademarks, physical structures (equipment or property) or lease agreements, these should all go in there.

You may have key assets such as proprietary software or algorithms that enable the center to provide a unique service. Additionally, the radiology center might have valuable intellectual property related to their imaging technology or processes that could give them a competitive advantage.

Finally, you should include a list of suppliers that you plan to work with and a breakdown of their services and main commercial terms (price, payment terms, contract duration, etc.). Investors are always keen to know if there is a particular reason why you have chosen to work with a specific supplier (higher-quality products or past relationships for example).

7. The presentation of the financial plan

The financial plan section is where we will include the financial forecast we talked about earlier in this guide.

Now that you have a clear idea of the content of a radiology center business plan, let's look at some of the tools you can use to create yours.

What tool should I use to write my radiology center's business plan?

In this section, we will be reviewing the two main solutions for creating a radiology center business plan:

• Using specialized online business plan software,
• Outsourcing the plan to the business plan writer.

Using an online business plan software for your radiology center's business plan

Using online business planning software is the most efficient and modern way to write a radiology center business plan.

There are several advantages to using specialized software:

• You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
• You are guided through the writing process by detailed instructions and examples for each part of the plan
• You can access a library of dozens of complete business plan samples and templates for inspiration
• You get a professional business plan, formatted and ready to be sent to your bank or investors
• You can easily track your actual financial performance against your financial forecast
• You can create scenarios to stress test your forecast's main assumptions
• You can easily update your forecast as time goes by to maintain visibility on future cash flows
• You have a friendly support team on standby to assist you when you are stuck

If you're interested in using this type of solution, you can try The Business Plan Shop for free by signing up here .

Hiring a business plan writer to write your radiology center's business plan

Outsourcing your radiology center business plan to a business plan writer can also be a viable option.

Business plan writers are experienced in writing business plans and adept at creating financial forecasts without errors. Furthermore, hiring a consultant can save you time and allow you to focus on the day-to-day operations of your business.

However, hiring business plan writers is expensive as you are paying for the software used by the consultant, plus their time, and their profit margin of course.

From experience, you need to budget at least £1.5k ($2.0k) excluding tax for a complete business plan, more if you need to make changes after the initial version (which happens frequently after the initial meetings with lenders or investors).

You also need to be careful when seeking investment. Investors want their money to be used to grow the business, not spent on consulting fees. Therefore, the amount you spend on business plan writing services (and other consulting services such as legal services) needs to be negligible relative to the amount raised.

The other drawback is that you usually don't own the business plan itself: you just get the output, while the actual document is saved in the consultant's business plan software - which makes it difficult to maintain the document up to date without hiring the consultant on a retainer.

For these reasons, outsourcing the radiology center business plan to a business plan writer should be considered carefully, weighing both the advantages and disadvantages of hiring outside help.

Ultimately, it may be the right decision for some businesses, while others may find it beneficial to write their business plan using online software.

Why not create your radiology center's business plan using Word or Excel?

Using Microsoft Excel and Word (or their Google, Apple, or open-source equivalents) to write a radiology center business plan is not advisable. Allow me to explain the reasons.

Firstly, creating an accurate and error-free financial forecast on Excel or any spreadsheet demands technical expertise in accounting principles and financial modelling. Without a degree in finance and accounting and significant financial modelling experience, it's unlikely that the reader will fully trust your numbers.

Secondly, relying on spreadsheets is inefficient. While it may have been the go-to option in the past, technology has evolved, and software now performs such tasks much faster and more accurately.

The second reason is that it is inefficient. Building forecasts on spreadsheets was the only option in the early 2000s, nowadays technology has advanced and software can do it much faster and much more accurately.

And with the rise of AI, software is also becoming smarter at helping us detect mistakes in our forecasts and helping us analyse the numbers to make better decisions.

Moreover, software offers ease in comparing actuals versus forecasts and maintaining up-to-date forecasts for clear visibility on future cash flows, as we discussed earlier in this guide. Such tasks are cumbersome when using spreadsheets.

Now, let's address the written part of your radiology center business plan. While it may be less prone to errors, using software can significantly boost productivity. Word processors lack instructions and examples for each section of your business plan. They also won't automatically update your numbers when changes occur in your forecast, and they lack automated formatting capabilities.

In summary, while some entrepreneurs may consider Word or Excel for their business plan, it's far from the best or most efficient solution when compared to specialized software.

• A business plan has 2 complementary parts: a financial forecast showcasing the expected growth, profits and cash flows of the business; and a written part which provides the context needed to judge if the forecast is realistic and relevant.
• Having an up-to-date business plan is the only way to keep visibility on your radiology center's future cash flows.
• Using business plan software is the modern way of writing and maintaining business plans.

We hope that this practical guide gave you insights on how to write the business plan for your radiology center. Do not hesitate to get in touch with our team if you still have questions.

Also on The Business Plan Shop

• In-depth business plan structure
• Key steps to write a business plan?
• Free business plan template

Know someone who owns or wants to start a radiology center? Share this article with them!

Founder & CEO at The Business Plan Shop Ltd

Guillaume Le Brouster is a seasoned entrepreneur and financier.

Guillaume has been an entrepreneur for more than a decade and has first-hand experience of starting, running, and growing a successful business.

Prior to being a business owner, Guillaume worked in investment banking and private equity, where he spent most of his time creating complex financial forecasts, writing business plans, and analysing financial statements to make financing and investment decisions.

Guillaume holds a Master's Degree in Finance from ESCP Business School and a Bachelor of Science in Business & Management from Paris Dauphine University.

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The interventional radiology business plan

• Dotter Institute

Research output : Contribution to journal › Article › peer-review

Strategic planning and business planning are processes commonly employed by organizations that exist in competitive environments. Although it is difficult to prove a causal relationship between formal strategic/business planning and positive organizational performance, there is broad agreement that formal strategic and business plans are components of successful organizations. The various elements of strategic plans and business plans are not common in the vernacular of practicing physicians. As health care becomes more competitive, familiarity with these tools may grow in importance. Herein we provide an overview of formal strategic and business planning, and offer a roadmap for an interventional radiologyspecific plan that may be useful for organizations confronting competitive and financial threats.

ASJC Scopus subject areas

• Radiology Nuclear Medicine and imaging
• Cardiology and Cardiovascular Medicine

Access to Document

• 10.1016/j.jvir.2012.05.044

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• Link to publication in Scopus
• Link to the citations in Scopus

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• Interventional Radiology Medicine & Life Sciences 100%
• Strategic Planning Medicine & Life Sciences 68%
• Psychology Recognition Medicine & Life Sciences 13%
• Physicians Medicine & Life Sciences 9%
• Delivery of Health Care Medicine & Life Sciences 9%

T1 - The interventional radiology business plan

AU - Beheshti, Michael V.

AU - Meek, Mary E.

AU - Kaufman, John A.

PY - 2012/9

Y1 - 2012/9

N2 - Strategic planning and business planning are processes commonly employed by organizations that exist in competitive environments. Although it is difficult to prove a causal relationship between formal strategic/business planning and positive organizational performance, there is broad agreement that formal strategic and business plans are components of successful organizations. The various elements of strategic plans and business plans are not common in the vernacular of practicing physicians. As health care becomes more competitive, familiarity with these tools may grow in importance. Herein we provide an overview of formal strategic and business planning, and offer a roadmap for an interventional radiologyspecific plan that may be useful for organizations confronting competitive and financial threats.

AB - Strategic planning and business planning are processes commonly employed by organizations that exist in competitive environments. Although it is difficult to prove a causal relationship between formal strategic/business planning and positive organizational performance, there is broad agreement that formal strategic and business plans are components of successful organizations. The various elements of strategic plans and business plans are not common in the vernacular of practicing physicians. As health care becomes more competitive, familiarity with these tools may grow in importance. Herein we provide an overview of formal strategic and business planning, and offer a roadmap for an interventional radiologyspecific plan that may be useful for organizations confronting competitive and financial threats.

UR - http://www.scopus.com/inward/record.url?scp=84865493340&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84865493340&partnerID=8YFLogxK

U2 - 10.1016/j.jvir.2012.05.044

DO - 10.1016/j.jvir.2012.05.044

M3 - Article

C2 - 22841900

AN - SCOPUS:84865493340

SN - 1051-0443

JO - Journal of Vascular and Interventional Radiology

JF - Journal of Vascular and Interventional Radiology

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The interventional radiology business plan.

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• Beheshti MV 1

Journal of Vascular and Interventional Radiology : JVIR , 28 Jul 2012 , 23(9): 1181-1186 https://doi.org/10.1016/j.jvir.2012.05.044   PMID: 22841900 

Abstract 

Full text links .

Read article at publisher's site: https://doi.org/10.1016/j.jvir.2012.05.044

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Clinical Practice Development

Business plans, timothy p. murphy.

1 Brown Medical School, Rhode Island Hospital, Providence, Rhode Island

Gregory M. Soares

The business strategy for establishing a clinical office involves three key components: fundamental change from the traditional technical model in processes for accepting referrals; establishment of a high-quality clinical operation; and changing the perception of interventionalist radiology among the referring community and the public. The costs and revenues used to derive profit and loss statements will vary considerably across regions and practice set-ups. Some of the considerations are outlined in this article, but it will be up to interventionalists and their business managers to make these factors conform to their individual practices and locations.

In this section we review a standard proposal for establishing a clinical office, focusing on the costs associated with such a venture and how the clinical practice should be structured. This proposal is based on the assumption that interventional radiologists will usually want to have hospital privileges and the ability to use imaging equipment and other resources in a hospital to perform operative procedures. Although clinical practice in the hospital, such as admitting patients and performing rounds on both service and consult patients, are essential components of a clinical practice model, it will not be the focus of this proposal. The business strategy involves three key components: fundamental change from the traditional technical model in processes for accepting referrals; establishment of a high-quality clinical operation; and changing the perception of interventional radiology among the referring community and the public.

Some of the items that must be addressed within a group practice include:

• Establishment of a clinic rotation to serve the referring population associated with the associated hospital(s), including office space, office staff, and physician rotation to accommodate an outpatient clinical service.
• Hiring physician extender(s) to assist with the medical office and expanded inpatient services.
• Understanding that a clinical practice will require patients to be seen by in consultation by an interventional radiologist doctor prior to scheduling therapeutic interventions.
• Consideration of logistical issues such as fixed schedules to accommodate patient continuity.
• Support for start-up office costs.
• Providing marketing resources for interventional radiology practice promotion efforts in the range of 5 to 10% of gross revenues.

The Department of Health and Human Services projects that there are ∼100,000 peripheral artery stent procedures performed in the United States each year, in addition to 80,000 carotid endarterectomies and 70,000 superficial femoral artery bypass grafts. There are as many as 9 million claudicants in the United States, of which at least 35% have disease amenable to endovascular revascularization, given pending technologies. This population could amount to 100,000 procedures annually. There are 2 million Americans with renal artery stenosis; if the National Institutes of Health CORAL study is accurate, there could be 200,000 renal stent procedures per year in the United States. Between carotids, renals, iliacs, and femoral arteries, there could be as many as 500,000 procedures performed in the United States each year. Approximately 200,000 women undergo hysterectomies for uterine fibroids each year. There are ∼20,000 cases of primary liver cancer and probably at least an equal number of cases of metastatic liver disease diagnosed each year. Roughly 40% of middle-aged women have symptomatic lower extremity superficial venous insufficiency requiring some form of treatment. In the future, many of these patients will be treated with endovascular therapy, conservatively estimated to generate 500,000 to 1 million high-end services annually. To put all this into perspective, this is comparable to the volume of coronary artery interventions done in the United States each year. The downside to underexpanding and underpromoting clinical services is potentially enormous.

A medical office will require at least one office person to arrange appointments and help schedule examinations and referrals when the office is open. This can be a part-time employee who works elsewhere when the office is closed. However, because referring physicians may want to contact consultants at any time, the telephone should be consistently answered and monitored 24 hours a day. In addition, it may be desirable to employ a medical assistant or nurse to obtain vital signs and organize charts and other clinical material that the physician will want to review. A PA or nurse practitioner (NP) can perform follow-up visits for routine, well patients. Although NPs can also accept referrals, using them for this vital role in maintaining the lifeline of the practice is usually not advisable.

A large interventional radiology practice can easily see patients 2 or 3 full days per week. Half that time might be taken up by doctors seeing new patients and doing short-term follow-up visits, with NPs or Pass providing long-term follow-up the remainder of the time. If a vein clinic is also done at the site, another 2 or more days may be required.

In general, physicians should be on site for at least a half day and can take turns staffing the clinic. If a practice is successful in promoting its doctors along service lines, then the clinic can be organized to accommodate those areas of interest. For example, a clinic meeting Tuesdays and Thursdays might schedule Tuesday as fibroid referral clinic, Thursday as peripheral arterial disease clinic, the following Tuesday as liver cancer clinic, and so on, with appropriate doctors scheduled for those days. This facilitates establishment of an identity within the referring community and promotes patient care.

OFFICE LOCATIONS

Outpatient referrals are almost always elective. Elective, outpatient consults are usually for disease processes that are often treated with complex invasive procedures, which include patients with peripheral arterial and venous disease, women's reproductive care issues, neurovascular disease, and cancer. These diseases are interesting to treat, offer considerable impact on patient outcomes, and are well reimbursed. This business plan is designed to increase the referrals of these patients. Conversely, if a clinical practice model is not implemented, these referrals are likely to decrease in the future.

A clinical practice cannot be fully conducted in a hospital, least of all in a radiology department. As noted in a previous article in this issue, the federal antikickback statute of 1972 prevents hospitals from providing noncompensated office space to doctors. Therefore, an office separate from the hospital is essential. It will be most convenient to locate the office near the hospital so it is convenient to go back and forth between the two. Some practices may want multiple offices to serve multiple population areas or hospitals. If the office practice must be fragmented, it may be desirable to look for a shared office or to sublet space in an office to reduce overhead. The disadvantage of this is that there may be restrictions on signage and therefore promotion of the office could be limited. Leases should be carefully crafted to avoid the inability to expand or contract the clinical service as needed.

FINANCIALS: AMBULATORY CLINIC/MEDICAL OFFICE

Many practices would like to know upfront about the return on investment for establishing a clinical interventional radiology practice. It is important to try and establish projections and estimates for this, but it must be emphasized that patient care comes first. There are compelling ethical reasons why interventional radiologists should not perform therapeutic procedures without establishing a meaningful physician-patient relationship, which can only be done within a clinical practice—even if it means that an office itself will lose money.

The pro forma provided (see Table ​ Table2) 2 ) is for a hypothetical private medical office operated by a physician private practice. It includes reasonable but conservative estimates of costs. The pro forma is suitable for a start-up office practice that would fill 1 full clinic day per week. It assumes that an interventional radiologist would be available in the clinic one-half day per week and 1 full day per week in an interventional radiology department performing procedures generated in the clinic. It assigns only 20% of physician assistant (PA) effort to this hypothetical venture, as the PA would work only 1 day per week in the clinic. This pro forma is conservative for several reasons. It does not consider other revenue generated for the practice by imaging tests ordered on patients seen in the clinic, which may occur in up to 70% of patients. 1 And because the pro forma is for a start-up office practice in session only 1 day per week, 80% of the overhead could be used more efficiently (such as using part-time office help, or subleasing space when the office is not in session). Even with these conservative assumptions, however, the pro forma shows a profit of more than $100,000 for an office practice seeing patients 1 day per week with six new patients referred per week. Ventures smaller than this hypothetical one may consider subleasing or sharing office space and staff. Other procedures, such as lower extremity varicose vein treatment, may also be offered in the space, increasing the practice time spent in the office to at least 2 or 3 days per week. As many of the costs are fixed, growth can be accommodated with more proportional contribution to profit.

The costs and revenues used to derive profit and loss statements will vary considerably across regions and practice setups. Some of the considerations are outlined below, but it will be up to interventionalists and their business managers to make these factors conform to their individual practices and locations. Financial assumptions (Table 1 ) and a pro forma based on them (Tables 2 and ​ and3) 3 ) are provided.

Revenue Assumptions *

There are several risks if execution of the business strategy is not done carefully and thoughtfully. For example, if a practice takes the clinical concept to an extreme and is not selective in triaging referrals, they may find a low percentage of new patients are appropriate for therapeutic interventions. Therefore, financial results will be much less robust than those outlined using the assumptions above and may even be negative. If the physician extender is not instructed and trained on follow-up parameters for various services, the liability issue could be important. Similarly, if the physician extender is presented as the clinical face of the interventionalist radiology practice, especially for new patients, it is unlikely that the practice will be viewed as adding value to patient care. If promotion results in demand that exceeds the practice's capacity to handle, the practice may inadvertently generate more business for other practitioners. If work is sloppy, unreliable, or the clinic is irresponsible with follow-up, subsequent referrals may not materialize. If the practice does not promote itself tactfully, potential referral sources may become disenfranchised. Finally, if any of these steps results in an undesirable experience for referred patients or their physicians, there is the possibility that referrers will regret their decision to try something new and may simply stop referring.

• McGraw J K, Fricke B, Lippert J A, et al. Prospective evaluation of imaging and interventional procedures generated by an out patient interventional radiology office. J Vasc Interv Radiol. 2004; 15 :S175. [ Google Scholar ]

BackTable / VI / Article

How to Build an Office-Based Lab & Requirements

Alexander Aslesen • Jul 16, 2019 • 3.8k hits

An office-based lab (OBL) is a practice model that is becoming more frequent amongst interventional radiologists across the country. From financing to contract negotiations, Dr. Mary Costantino talks about her experience building an office-based lab & the requirements for one in episode 36 of the BackTable podcast. We’ve provided the highlight reel in this article, but you can listen to the full podcast below.

The BackTable Brief

• There are office-based lab requirements needed to make a successful OBL, like a business plan, understanding financing, insurance contracts, equipment options and employee negotiations work. Dr. Costantino suggests financial planning is the most important consideration, as startup expenses may be cumbersome. • At best, expect a 14-16 month time frame to develop and open an OBL for interventional radiology. • As a rule of thumb, Dr. Costantino says it will be around 6 months after opening your OBL before you will be doing cases regularly; building a referral base will take time as you establish your practice. • If your OBL is not tied to a hospital, do not count on hospital referrals; Dr. Costantino frequently gives lectures and meets other physicians to increase referrals to her practice.

Table of Contents

(1) The Ins and Outs of Office-Based Labs

(2) How Long Until I Start Seeing Patients in my Office-Based Lab?

(3) Obtaining Referrals to Fuel Your Office-Based Lab

The Ins and Outs of Office-Based Labs

Prior to starting her office-based lab, Dr. Costantino spent a few years learning the ins and outs of OBL requirements including financing, insurance contracts, equipment options and employee negotiations. Financial planning, requirements, and understanding the timeframe to set up an OBL are three very important considerations. Although you may be without a salary for the first 1-2 years, there will be a favorable turnaround after establishing your practice. At best, Dr. Costantino says to expect a 14-16 month interval for setting up a successful office-based lab.

[Mary Costantino] Well, I think an OBL is a really great thing for someone who is always learning. There's a lot of business. I have to be really cognizant. This goes back to having some good luck of having the business development person at the outpatient imaging center. She had a human resources background. We would talk about, why didn't things work out in the first group that I was part of, and why is A so easy and B is so difficult. Some advice that I took away from that is finding your happy place, right? For me, I'm very cognizant of what my happy place is. That's in a cath lab with my hands on a catheter doing cases. You have to be really cognizant of that because the business side of it can take over. It's interesting. It's fun. It's different. It's entrepreneurial. Over the last year, I've looked at every piece of equipment known to mankind. You can be really distracted by that because it is really fun. It works the brain in a different way. There's the marketing. You learn all about marketing. You learn all about construction. You learn all about equipment. You learn all about product cost and contracts and the whole business of medicine. When you have a corporation or a hospital behind you, they are doing all that. You don't even know what insurance products you cover or how that works. One fun part is that I get to know all of that stuff. It also can be an endless job. I always keep in mind what's the thing that I like to do. I would say that's a challenge for people who are going into it is, you want to be really, really cognizant of how you spend your time. I do believe in hiring good people, they're expensive also. Another challenge is that you're not going to make any money. I haven't really had a salary in a year. For me, the financial part of it, preparing, anyone can do it because IRs make enough to be prepared for the investment, but it really becomes a startup like you would see a software startup or a device startup or really, any other type of startup. That mentality is very different than the hospital-based IR who is used to making their big salary every year. [Michael Barraza] Right. You're talking about just until you reach that break even point? [Mary Costantino] Yeah. Depending if you lease or rent, you're looking at buying a building, paying contractors. Yeah. It can be a very lucrative situation on the other end, but what does that year or two years look like. I don't know. About 25% of OBLs closed is what I've heard. I find that hard to believe if done correctly because it's favorable for everything. It's favorable financially. It saves the healthcare system money. It's much easier on the interventional radiologist. I don't think anybody loses in an OBL, but you just have to be prepared for it. If somebody is going into building an OBL, I think the number one thing you want to do is, you want to approach this as a startup. In general, everybody is different, but we're used to being employees. We're used to getting a salary. We have lifestyles that demand a certain level of income. To have that be not so steady, that's not for everybody. What I would say to anybody who's interested in doing this, start financially planning for it because you're going to be down for a year or two. It's okay because that is how startups go, but then the upswing will come, and the pay-off will be there. To anybody who wants to start an OBL tomorrow, you're looking at 14 to 16 months type time frame at best. In that time frame, I would say, the number one thing is, get your financials in order and start saving money because you're going to start writing checks like you would not believe. You're going to have six months to get insurance contracts negotiated. A lot of people in hospitals don't understand how that works, which is, your group bills under your group's NPI. When you leave, you have to build on your own NPI, which means you have to renegotiate your contracts with every single insurance provider. The value of being in a group like CIC is that they have people to negotiate these contracts. Because if I call up as an independent person, my rates are not going to be as good. … You got to remember, there's anywhere between two and four years of work, kind of a second, job going into building these things, right? Every vacation I take, I'm on the plane to go visit an OBL. I did a lot of visiting of OBLs. I still will do that forever. I learn from every single visit I make. Contracts are really important including finding a good contract attorney. I would say not a healthcare attorney. You're entering into a business relationship with people forever. The reason there are contracts is because if things go bad, you want it to be clear how a separation is going to exist. It's not so much about the startup, it's about what happens when things don't work out. We have a lot to learn as IRs and physicians about that process, especially if our history is just being handed an employment agreement and saying, "Here's your employment agreement." Maybe we're negotiating for a 5% salary difference or one last day of call. It's not really about those things in your corporate agreements. The financing. The financing is really interesting and I've seen all different models. Certainly, what is out there has evolved. When I started thinking about OBL, probably six years ago, the deal for physicians was much different than the deal now. Right now, there are many more people out there being consultants who will tell you they'll startup your lab. They all have a good sales pitch, so be careful.

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How long until i start seeing patients in my office-based lab.

Following the establishment of an office-based lab, Dr. Costantino suggests it will be around 6 months before you start regularly doing cases. Many patient referrals to the OBL are for elective procedures, which may not require immediate intervention on behalf of the patient. Patients needing uterine fibroid embolization, for example, may wait months to schedule the procedure. Furthermore, building a consistent referral base to your practice takes time.

[Mary Costantino] … You hit on a really important topic about starting ... "When are you going to see your first patient in OBL?" I usually tell people, "Six months. Don't be surprised if you don't do any cases in six months." [Michael Barraza] Why six months? It's so long. [Mary Costantino] It's different for every person, right? Everybody has different experiences, but you can't really count on getting income through the door for about six months. Maybe you're doing some procedures earlier, but the minute you open your doors, then you now need to let people know you're there. Then they actually have to send patients to you, and then patients actually have to show up, right? Especially for elective procedures. We're not talking about cold legs. We're talking about women with fibroids who have been bleeding for two years. They may be doing whatever in their lives, and they have the referral, and they show up two to three months later. They then have to decide if they want the procedure. This is all this very long process.

Obtaining Referrals to Fuel Your Office-Based Lab

Maintaining a constant referral base may be difficult if you’re depending on referrals from hospital-based physicians. Unless your office-based lab is associated with a hospital, the hospital system will try to keep referrals local. Dr. Costantino has used various forms of marketing to increase her referrals including giving talks and meeting local physicians. She says, “if you get a couple (referrals) that trickle in from the hospital, you'll be super excited.”

[Mary Costantino] … The other thing is, as much as people are liked in the hospital, they usually do not get referrals from the physicians they know in the hospital. [Michael Barraza] That's a good point. I haven't thought about that. [Mary Costantino] Yeah. This is a really common mistake. Again, everybody's situation is a little bit different. For some people, their OBL is tied in to the hospital. That's, maybe, a different situation, but in general, IRs were well-liked. The GI doctors and vascular surgeons and everybody you see in the hallway … even if they say, "Oh, yeah. We'll send patients to you." Once you're gone, you're gone in their mind. Locally, our hospitals have their own insurance products. They're very big on keeping people within their system even if they don't have their own insurance product. If you're a primary care provider at a hospital system, you're going to be hounded by your administration to send to your own gynecologist or your own IRs. Some of the local systems here are so bad that if they order a referral, on the order it says my name, Mary Costantino, a non-legacy provider in big capital letters. I’m sure, someone sitting on the back is screening those, right? They will then go to the gynecologist and say, "Why are you sending outside of our system?" For those reasons, I think it's just easier to start fresh just to not really anticipate on having a whole lot follow you. You'll just be happier in the end. If you get a couple things that trickle in from the hospital, you'll be super excited. [Michael Barraza] Tell me this, before we get into what your practice looks like now and everything. What has worked for you both for UFE and for other things in building your business? [Mary Costantino] I've done all sorts of ads and TV. Ads haven't really worked. The patients respond differently. I don't actually like the print ad and the fancier magazines. I've done, basically, every type of marketing. I don't like the kind of marketing that I actually have to do that's any more than meeting physicians. I don't even really like driving around and meeting physicians but you have to do it. I like the talks. … I go around and meet physicians. I have to stay active in giving talks. I don't think there's anything you don't do when you don't have any patients.

Podcast Contributors

Dr. Mary Costantino

Dr. Mary Costantino is a practicing interventional radiologist with Advanced Vascular Centers in Portland, OR.

Dr. Michael Barraza

Dr. Michael Barraza is a practicing interventional radiologist (and all around great guy) with Radiology Associates in Baton Rouge, LA.

Cite This Podcast

BackTable, LLC (Producer). (2018, December 19). Ep. 36 – Building an Outpatient UFE Practice [Audio podcast]. Retrieved from https://www.backtable.com

Disclaimer:  The Materials available on BackTable.com are for informational and educational purposes only and are not a substitute for the professional judgment of a healthcare professional in diagnosing and treating patients. The opinions expressed by participants of the BackTable Podcast belong solely to the participants, and do not necessarily reflect the views of BackTable.

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New Business Opportunities in Interventional Radiology

Use the IR Clinic Model

Interventional Radiologists (IRs) have traditionally worked behind the scenes, often performing procedures based on decisions made by the referring physician rather than participating in treatment option discussions with the patient directly.  Developing an “IR Clinic” can help improve the IR’s visibility to both patients and the referring physician community, as well as provide the patient with a more satisfying experience. 

The IR Clinic can be located either within the hospital or in an outside facility.  An office suite located near the IR procedure rooms, with a patient-friendly registration and waiting room, can be used for consultations with prospective patients.  This will provide the IRs with a place to establish their identity as consultative physicians, while allowing them to work efficiently to balance procedures with consultations.

If the practice has a diagnostic imaging facility near the hospital, then an alternative could be to establish the IR Clinic within the imaging center.  This has the advantage of increasing traffic to the center, which can lead to future imaging procedures and reinforce ‘one-stop shopping’ for all of the patients’ radiology needs.  The imaging center is already set up with a patient-friendly environment, and minimal work would be needed to outfit an appropriate consultation space. 

In its fullest implementation, the clinic concept can be developed into a freestanding interventional radiology facility complete with procedure rooms.  This alternative will be attractive to insurance payers as their cost will be lower than for the same services in a hospital-based facility and patient satisfaction could be greater than going to a hospital facility.  With their ability to direct patients, insurance payers can be a powerful partner in developing the IR Clinic.  Equipment vendors are also a useful resource in helping set up a freestanding clinic by assessing cost and estimating reimbursement and ROI.

Promote the Practice’s IR Capabilities

The IR Clinic can establish a practice identity as a sub-specialty within the diagnostic group.  Its website should be designed to attract patients looking for surgical alternatives who will self-refer for IR procedures.  At the same time, developing referral relationships with non-procedure based specialties like medical oncology and pediatrics will be welcomed by them because they don’t offer competing services.

The IRs should develop a menu of procedures offered by the practice and market these to the appropriate referral sources.  For example, an IR practice that performs  y-90 radioembolization   for liver tumors will want to be sure the oncology community is aware of this capability, especially as an alternative for their patients who are not candidates for surgery.  Similarly, OB/GYN practices should understand that uterine fibroid embolization (UFE) is available.  Advertising directly to the public should not be overlooked, either.  According to a survey reported in an August 2017 auntminnie.com article , the majority of women diagnosed with uterine fibroids were not aware of UFE as an alternative to surgery.  Of those surveyed who were aware of UFE, 73% learned of it by word of mouth, through their own research or through advertising.

Outlook for Growth of IR

According to  The Advisory Board , there are three trends in healthcare with which IR aligns directly:

• the cost of care is lower than for surgical procedures
• it is attractive to consumers who shop for healthcare alternatives
• it reduces hospital stays by providing services in hospital outpatient departments or in freestanding facilities

The IR Clinic’s development plan should address its ability to leverage these trends. As interventional radiology procedures are developed to treat a wider range of conditions, the IR Clinic will become that much busier. 

Get the Most Revenue for IR Services

Interventional radiology billing is more complicated than billing for the average diagnostic radiology procedures, and it requires the use of CPT ® codes that are not commonly used in other areas of the practices.  Achieving maximum reimbursement will require a collaborative effort between the IR physicians and the clinic’s coding team.  The coders working on the IR clinic’s services must have expertise in this area, and the medical record created by the physician has to be detailed enough for them to extract the information they need. 

IR practice requires the use of Evaluation and Management (E&M) codes for consultations and office visits.  Read our companion article for more information on the proper use of E&M codes in IR practice. 

IR can become a more lucrative sub-specialty within the radiology practice by becoming more visible to patients and the referring community.  Development of the IR Clinic, whether within the hospital or in a freestanding facility, will enhance both patient and referring physician satisfaction and will be attractive to insurance payers at the same time.  While there are billing and documentation considerations to be aware of, proper training of the physicians and coding team will maximize reimbursement for these services.

Our detailed overview of the 2018 coding updates for diagnostic and interventional radiology will be published soon.  Subscribe to our free blog now and get it delivered right to your inbox.

Sandy Coffta is the Vice President of Client Services at Heatlhcare Administrative Partners. Her areas of expertise include revenue cycle management, radiology practice billing and coding, and provider reimbursement issues.

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