For 2012, CMS proposed a reduction in the cost-of-capital (or interest-rate) assumption used in the development of the cost-of-equipment estimates that are included in the practice-expense component of the RVU calculations. Historically, CMS has used an interest-rate assumption of 11%. Based on the current prime rate and maximum interest rates for
Evidence suggests that imaging utilization declined between 2009 and 2011, particularly for the high-tech modalities, including CT and MRI. Data1 from Regents Health Resources published in Radiology Business Journal indicate that growth in medical imaging slowed, relative to US population growth, in this time period, and that CT utilization
Judging solely by the number of imaging engagements at our company during the first half of 2011, imaging transactions continue at a frantic pace. For the most part, there are not any new trends to report in imaging valuations. Discount rates, multiples, and the primary value drivers—competition, volumes, reimbursement, and capital-expenditure
While hospitals have always been significant players in the market for freestanding imaging centers, volume for hospitals purchasing all or part of the ownership interest in freestanding imaging centers has increased dramatically over the past few years. For hospitals already involved in joint ventures with physicians or entrepreneurial companies,
Elliott Jeter, CFA, CPA/ABVSignificant market trends, over the past few years, have affected the competitive environment between hospitals and physician-owned freestanding imaging centers. The primary drivers of these trends are the relative weaknesses of a large number of freestanding imaging centers (caused by changes in reimbursement and
While the industry landscape has certainly changed significantly since Radiology Business Journal published my article on this subject three years ago, the primary factors that drive the desire to complete transactions and the valuations remain largely intact.