- Sg2 forecasts double-digit growth in diagnostic imaging services over the next decade, driven by increased population demand and technology advances.1
- Advanced outpatient imaging is forecasted to grow 15% over the next decade, particularly computed tomography (CT) and positron emission tomography (PET) exams.
- Department of Labor anticipates an average increase in demand of nearly 10% from 2020-2030 for MRI, nuclear medicine, ultrasound, radiologic and cardiovascular technologists, as well as medical dosimetrists.3
Advanced outpatient imaging is forecasted to grow 15% over the next decade
Sg2®, a Vizient company, forecasts double-digit growth in diagnostic imaging services over the next decade driven by increased population demand and technology advances. While the shift of surgical and interventional cases from inpatient to outpatient facilities is expected to level out, imaging exams will likely continue to migrate toward lower-cost outpatient settings. Advanced outpatient imaging is forecasted to grow by 15% over the next decade, particularly computed tomography (CT) and positron emission tomography (PET) exams.1 What will be the top trends in diagnostic imaging in 2023? We turned to our experts and data here at Vizient to peer into the future for you.
Figure 1. Strong growth expected for nearly all imaging modalities
Source: Impact of Change®, 2022; Sg2 Analysis, 2022. Confidential and Proprietary 2023 Sg2.
Note: Analysis excludes 0-17 age group. Standard imaging includes nuclear medicine/SPECT, CT, U/S and X-ray. Advanced imaging includes CT, MRI and PET. PET = positron emission tomography, SPECT = single photon emission computed tomography. U/S = ultrasound. Source: Impact of Change®, 2022. Sg2 Analysis, 2022. Confidential and Proprietary 2023 Sg2.
More than 85% of hospitals and outpatient facilities continue experiencing staffing challenges,2 yet the U.S. Department of Labor anticipates an average increase in demand of nearly 10% from 2020- 2030 for MRI, nuclear medicine, ultrasound, radiologic and cardiovascular technologists, as well as medical dosimetrists.3 In addition to staff burnout, facilities are reporting longer lead times when attempting to fill open positions, as well as the need to offer sign-on bonuses and higher pay to attract talent. Many facilities are turning to staffing agencies, as well as physician assistants and newly graduated technologists, to fill the open shifts. To help alleviate challenges, administrators should review alternate workflow optimization solutions to address staff burnout and workforce staffing. Healthcare organizations are using artificial intelligence (AI) and automation to improve technologist workflows, including reducing time-consuming tasks by improving image reconstruction with both AI and deep learning algorithms. This is beneficial for modalities such as CT or MRI that require a lot of image reformatting. Lastly, investing in employee growth and development will provide staff with obtainable goals — which often rank as more important than compensation in employee surveys.4
Though the pitfalls of asset management predate the pandemic, post-pandemic economic conditions brought on by the pandemic magnified the urgency for many healthcare providers to address these challenges. Delayed capital purchases mixed with increased budgetary scrutiny has left many organizations with aged imaging equipment and little clarity on how to prioritize varied imaging needs throughout their facilities. To solve for these challenges, providers should move beyond a reactive procurement process for imaging equipment to a more comprehensive vision of fleet management that aligns with organizational goals, without a myopic focus on emergent or high visibility equipment. To accomplish this, disparate and manual asset tracking systems need to be integrated into an all-inclusive dashboard that accurately tracks equipment and offers a seamless view into the insights needed for an asset management program. With imaging volumes forecasted to grow, many healthcare systems are analyzing and rebalancing their imaging equipment strategy for the long term. Asset management programs like HANDLE Global, and other long term strategic partnerships are likely to be the trend to drive these initiatives forward.
The Food and Drug Administration (FDA) has approved at least 521 AI-enabled healthcare devices5 to date, with three-fourths of those related to radiology and cardiology, while a Centers for Medicare and Medicaid Services’ (CMS) recent ruling provided add-on code reimbursement6 for several software-as-a-service solutions. While still early, the surge of AI in diagnostic imaging is catching on fast, with many providers dedicating executive resources to evaluate and govern AI use within their institutions. Some providers are formulating evaluation frameworks to categorize and evaluate AI’s effectiveness in diagnostic imaging and to determine if an AI solution is beneficial enough to purchase.7 Most market research reports project the global AI market for diagnostic imaging to grow at an annual rate of more than 30% through 2030, with North America making up around 44% of the global market.8 Today, the use of AI in diagnostic imaging is determined on a case-by-case basis in various parts of a radiology department’s workflow, however, the benefits of AI could eventually be amplified by evaluating multiple AI use cases within a single patient visit. Ultimately, providers, regulatory and legislative organizations and payors must align around AI use parameters and payment models to reap the most benefits.
With fee-for-service as the most common model for diagnostic imaging services and an aging patient population, diagnostic imaging exam volume will only increase. Scrutiny and downward reimbursement pressure for diagnostic imaging services have become the norm due to CMS sequestration cuts and required appropriate use criteria for advanced diagnostic imaging. CMS has resumed the 2% sequestration payment cuts for radiology (paused during the pandemic), but with additional reimbursement cuts to balance federal budgets.9 These are mandated by the Statutory Pay-A-You-Go Act of 2010,10 which alone will result in an estimated 4% reimbursement cut in 2023.11 Furthermore, CMS will discontinue the Merit-Based Incentive Payment System (MIPS) bonus for exceptional performance in 2023 and will begin implementing negative payment adjustments for providers who do not achieve the threshold of 75 MIPS points. Provider, patient and industry organizations continue pressuring legislators to mitigate these reimbursement cuts. In the future, providers should optimize service line offerings and commercial payor relationships to continue delivering high-quality imaging services.
Research from Sg2®, a Vizient company, forecasts a decrease in the shift to outpatient surgical facilities as more intricate cases remain within hospitals, requiring providers to redesign inpatient care to accommodate increasing complexity and comorbidities.1 A hybrid operating room with an adjacent, intraoperative ultrasound (IOUS), MRI (iMRI) or CT (iCT) is advantageous for complex surgical cases, especially neurology, oncology and spine procedures. For example, a provider can use intraoperative ultrasound to scan the anatomy in real time during a procedure versus having to pause and wait for a designated scan time. Smaller footprint imaging systems may make options like this feasible in previously inadequate areas. As providers begin to reshape inpatient care, bringing intraoperative imaging closer to the patient is an important consideration for quality care.
Figure 2. Care redesign efforts necessary to dampen the effects of rising acuity on bed days
Sources: Impact of Change®, 2022; HCUP National Inpatient Sample (NIS). Healthcare Cost and Utilization Project 2019. Agency for Healthcare Research and Quality, Rockville, MD; Claritas Pop-Facts®, 2022; Sg2 Analysis, 2022. Confidential and Proprietary 2023 Sg2
Mergers and acquisitions
Healthcare mergers and acquisitions are trending up toward pre- pandemic numbers, with the highest number of deals since the pandemic being announced in fourth quarter 2022. Despite higher interest rates and increasing cost of capital, mergers and acquisitions continue to gain momentum and are larger in scale. Kaufman Hall reports (see figure 3) that even though the number of transactions is below pre-pandemic levels, the combined revenues of parties to announce transactions in 2022 total to more than the historic high of 2017.12 Many diagnostic imaging providers remain fragmented and unable to make the necessary investments to keep up with a growing demand for imaging services, and the sector continues to be a prime target for consolidation. Demand may be healthy enough in some areas to support more than one market leader, enabling consolidation to build scale and add service lines. Because diagnostic imaging services are used in virtually all medical specialties, value-based care initiatives also support consolidation. With rural or urban providers representing 30% of sellers, cross-market transactions are also gaining traction as academic medical centers and integrated delivery networks expand geographically into community hospitals and outpatient imaging networks. As consolidation progresses, local market competition will increase as providers align scaled services around their region’s disease prevalence.
Figure 3. Healthcare merger and acquisition revenue
Source: Singh A. 2022 M&A in review: regaining momentum. Kaufman Hall. Published January 12, 2023. Accessed February 7, 2023. https://www.kaufmanhall.com/insights/research-report/2022-ma-review-regaining-momentum.
According to a 2022 IBM report, the healthcare industry experiences the highest cost for data breaches by industry with a $10.10 million average cost per data breach.13 Cyberattacks can be especially crippling in the technology-dependent radiology department. It’s crucial for departmental stakeholders to understand their current information technology assets and software versions and have a plan to update platforms and replace outdated systems.
Enterprise imaging partnerships
Today’s providers recognize that longer-term arrangements with suppliers can offer savings and standardization across the health system. As a result, they’re looking beyond break-fix and episodic imaging equipment purchases to consider the total life cycle of their equipment fleet, from planning to disposition. By strategically partnering with a supplier, providers can optimize and simplify equipment life cycle management across multiple sites while achieving economies of scale for purchases spread over a designated timeline. Strategic partnerships can also help alleviate staffing and productivity challenges by standardizing user interfaces and procedure protocols across multiple labor pools while bolstering vendor service support received. Even standardizing across certain areas of imaging can achieve efficiencies and alleviate pain points. With advanced disease prevalence and the anticipated rise in applications like AI, providers need flexibility to upgrade equipment capabilities to advance patient care initiatives.
Sg2 research anticipates a decrease in the shift to outpatient surgical facilities as more intricate cases remain within the hospital, requiring providers to redesign inpatient care to accommodate increasing complexity and comorbidities.1 A hybrid operating room with an adjacent IOUS, iMRI or iCT is advantageous for complex surgical cases, especially neurology, oncology and spine procedures.
Patient consumer innovation
A pre-pandemic Sg2 survey revealed that cost and quality were the most important factors in advanced imaging services, with consumers indicating they prefer a one- stop shop for healthcare.14 Convenient access was rated lower in importance compared to cost and quality.14 Overall, seamless continuity of care, integration of care and personalized experience remain important consumer priorities. Consumers also expect the same level of integrated digital access they receive at their preferred provider when scheduling imaging exams, providing payment and receiving imaging results. Imaging providers can leverage integrated digital networks with health systems, referring providers and payors to meet patient expectations. Outpatient imaging consumers also anticipate a retail-like experience offering competitive options, excellent customer service and modern facilities.
With the FDA’s 2022 approval of Pluvicto, a radioactive therapeutic drug for advanced prostate cancer, many providers are contemplating theranostics as a potential service line. This would support an increase of both PET/CT and single positron emission tomography (SPECT) exams because both help stage and monitor theranostics treatment response. While domestic availability and financial viability of theranostics remain constraints to its growth, several in- process clinical trials and patients awaiting new treatment options are putting theranostics on to provider roadmaps. Increasing support for potential passage of the Facilitating Innovative Nuclear Diagnostics Act,15 introduced in 2021, may also provide a boost to theranostics by supporting reimbursement for the diagnostic radiopharmaceuticals used in conjunction with theranostic treatment. Providers should also monitor pending supply chain and legislative advances as they consider implementing theranostic services.
To achieve organizational objectives in an ever-evolving landscape, imaging providers must develop strategies to meet increased demand for services, drive cost reduction and improve efficiencies. This starts with data-driven insights and intelligence that enable providers to successfully navigate challenging market conditions. Diagnostic imaging remains a cornerstone of high-quality patient care, and providers who plan well will be positioned to further advance their imaging offerings.
Access the Diagnostic Imaging Tech Watch for additional insights and trends in imaging.
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- 2022 Sg2 Impact of Change® forecast. Proprietary Sg2 data. Sg2 | Health Care & Hospital System Consultancy.
- AMN Healthcare survey: 85% of healthcare facilities face shortages of allied healthcare professionals [press release]. Dallas, Texas. Globe newswire. AMN Healthcare. October 20, 2022. Accessed February 7, 2023. https://www.globenewswire.com/news-release/2022/10/20/2538448/0/en/AMN-Healthcare-Survey-85-of-Healthcare-Facilities-Face-Shortages-of-Allied-Healthcare-Professionals.html.
- Projections Managing Partnership. Long-term occupational projections (2020-2030). Projections Central (U.S. Department of Labor). Published 2021 Accessed February 7, 2023. https://projectionscentral.org/Projections/LongTerm.
- Five ways to avoid staff burnout in healthcare. Enzee. Published January 20, 2023. Accessed February 7, 2023. https://www.enzeehealth.com/post/avoid-staff-burnout-in-healthcare.
- Artificial Intelligence and Machine Learning (AI/ML)-Enabled Medical Devices. U.S. Food and Drug Administratrion. Artificial Intelligence and Machine Learning (AI/ML)-Enabled Medical Devices | FDA. Accessed April 11, 2023
- CMS Details SaaS Add-On Code Reimbursement in CY 2023 HOPPS ASC Final Rule. American College of Radiology. Accessed April 11, 2023. CMS Details SaaS Add-On Code Reimbursement in CY 2023 HOPPS ASC Final Rule | American College of Radiology (acr.org).
- Omoumi P, Ducarouge A, Tournier A, et al. To buy or not to buy–evaluating commercial AI solutions in radiology (the ECLAIR guidelines). Eur Radiol. (2021;31(6):3786-3796. doi: 10.1007/s00330-020-07684-x.
- Grand View Research. AI In medical imaging market size, share & trends analysis report by technology (deep learning, NLP), by application (neurology, respiratory & pulmonary, cardiology), by modality, by end-use, by region, and segment forecasts, 2023 - 2030. Updated 2022. Accessed February 7, 2023. https://www.grandviewresearch.com/industry-analysis/artificial-intelligence-medical-imaging-market.
- Coffta, Sandy. Healthcare Administrative Partners. Regulatory Update-Radiology Faces Revenue Cuts in 2023. December 2, 2022. Accessed March 10, 2023. https://info.hapusa.com/blog-0/regulatory-update-radiology-faces-revenue-cuts-in-2023.
- Policy Basics: The “Pay-As-You-Go” Budget Rule. Center on Budget and Policy Priorities. Policy Basics: The “Pay-As-You-Go” Budget Rule (cbpp.org). Accessed March 10, 2023.
- MD interactive. The 2023 Quality Payment Program Final Rule is Here – Learn What Changes are Ahead for MIPS Reporting. November 4, 2022. Access March 10, 2023. https://mdinteractive.com/mips-blog/2023-quality-payment-program-final-rule-here-learn-what-changes-are-ahead-mips-reporting.
- Singh A. 2022 M&A in review: regaining momentum. Kaufman Hall. Published January 12, 2023. Accessed February 7, 2023. https://www.kaufmanhall.com/insights/research-report/2022-ma-review-regaining-momentum.
- Cost of a Data Breach Report 2022. IBM Security. Accessed March 14, 2023. https://www.ibm.com/downloads/cas/3R8N1DZJ.
- Sg2 National Health Care Consumerism and Insurance Coverage Survey. 2018; Sg2 National Health Care.
- Consumerism and Insurance Coverage Survey. December 2019.
- Society of Nuclear Medicine and Molecular Imaging. Accessed April 13, 2023. https://sites.snmmi.org/SNMMIMAIN/FIND_Act/Find_act.aspx.