In a stunning consolidation of the imaging services segment, Radiology Partners has agreed to take over radiology contracts currently held by debt-laden national medical group Envision Healthcare. The agreement could bring up to 100 imaging sites and hundreds of radiologists into the RadPartners fold.
The takeover is a remarkable comedown for Envision, which was once one of the largest national medical practices in the U.S. and employed some 25k physicians when it was acquired in 2018 by private equity giant KKR.
- Envision’s business crossed multiple medical specialties, with its radiology operation at one point employing 800 radiologists who performed over 10 million reads per year.
But Envision struggled under a $5.3B debt load imposed by the KKR buyout, and eventually filed for Chapter 11 bankruptcy protection in 2023 in a move that also included spinning off its ambulatory surgery business.
- Many industry observers have viewed Envision’s rise and fall as a cautionary tale illustrating the perils of private-equity investment in American medicine.
Radiology Partners itself has evolved into the giant of the imaging services segment as it rolls up local radiology practices into a massive national network. Under the agreement with Envision, RP will …
- Take over Envision’s contracts with some 95 client sites, including teleradiology.
- Potentially bring some 400 Envision radiologists onboard (assuming they want to join RP).
The question is, how many Envision radiologists will choose to go with the contracts and join Radiology Partners?
- Speculation on industry bulletin board RadHQ.net proposes that Envision radiologists will be offered new contracts with RP – contracts that they can take or leave.
The Takeaway
Radiology Partners’ takeover of Envision’s radiology contracts will only enhance RP’s dominance of the imaging services market, which is already significant. While that may be good news to RP’s investors, it probably won’t be encouraging to those worried about the inexorable corporatization of radiology.
