Despite the chaos taking place in medical imaging today, there are a number of trends that appear to be emerging. These trends will reflect the future of medical imaging. In this article, we examine the environment for medical imaging in terms of the major thrusts that are occurring in the marketplace.
A picture archiving and communication system (PACS) is clearly a
requirement for any radiology department or healthcare organization
that is going to survive into the 21st century. The impact of
managed care and the requirement for regionalized healthcare are
among the drivers of PACS.
When using the term PACS, the following components are implied:
radiology information systems (RIS), teleradiology, information
networks, archiving schemes, diagnostic reading centers,
compression techniques, and so forth. It appears that PACS is
becoming a catch-all for any hardware and software devices/tools
that attach to the diagnostic imaging network (excluding the
imaging acquisition modalities of CT, MRI, etc.). Therefore,
computer-aided-diagnostics techniques may become a part of the PACS
In a presentation at HealthTech '97, Dr. Ed Staab, of the
University of Florida in Gainesville, cited cost, productivity, and
diagnostic accuracy as key areas for focus in the future. Cost and
diagnostic accuracy are considered below. PACS is the answer to
achieving higher productivity levels within a department,
institution, or regionalized grouping of institutions. PACS
technology enables reengineering of process to take place at the
highest levels of productivity gain.
To date, unfortunately, most of the applications associated with
PACS have not resulted in significant gains in productivity. The
reason for this is that new technology for PACS was purchased
without adequate training associated with reengineering of process.
The result has been a low-value condition due to large expenditures
without adequate payback.
This situation is changing. Well-documented examples of
significant productivity gains and adequate payback obtained from
PACS are now available. In some cases, the major gains are found
within the hospital and not only in the radiology department.
Several interesting trends associated with PACS were
demonstrated at the 1996 RSNA. The integration of PACS components,
such as workstations, teleradiology, radiology information systems,
and even telemedicine, was demonstrated. The general trend is
to give the customer confidence that a "total system" concept is
feasible and that the challenges associated with interfacing
equipment are under control. The industry still has not forgotten
the interface nightmare associated with digital subtraction
In addition, several manufacturers demonstrated products that
utilize the Internet and worldwide web technology to gain access to
imaging databases and information. This area is expected to grow
rapidly. The opportunities for sharing clinical study databases and
for calling upon algorithms for computer-aided diagnostics are
During the next several years, it is expected that PACS will be
one of the fastest growing segments of the diagnostic imaging
Patient-driven purchasing criteria
This is a gradual shift that will probably take another three to
five years to reach fruition. However, the trend in this direction
has clearly begun.
Over the last 15 to 20 years, the criteria for purchasing
diagnostic imaging equipment usually have been based on the
- Technical leadership-This concept consists of key
specifications that indicate state-of-the-art performance.
Examples would be a nuclear gamma camera that has molecular
coincidence detection or ultrasound that contains 3D
- Image quality-This is a combination of spatial resolution,
contrast resolution, and signal-to-noise ratio that results in
the best conspicuity.
- Throughput-This is the number of patients that can be scanned
per unit of time. The measurement often is based on the time from
the start of one patient exam to the start of the next patient
- Life cost-This is the number of patients per unit of time
required for break-even financial performance. The measurement
often is based on a five-year depreciation schedule for equipment
and includes all possible costs associated with the use of the
equipment in question.
- Total service-This is defined as a combination of
reliability, applications, marketing, and planning services
(e.g., asset management) provided by the manufacturer or
independent service provider. This factor has changed over time
as new equipment has required special services for successful
operation. For example, MRI customers in a private setting
required assistance in marketing to attract referrals.
Factors 3 and 4 together represent the profitability of the
customer. For example, a CT site where the throughput is 25
patients per day and the life cost is 4 patients per day has a
profitability (given the availability of patients) that is based on
21 patients per day.
The factors noted above are sometimes referred to as the old
high 5 or specification-based factors. When looking at comparisons
between different products, many terms are used. Most often,
however, they can be summarized in terms of the factors noted
During the last few years, with the advent of managed care, it
became apparent that a key ingredient is lacking in the old high 5.
That ingredient is the patient. Therefore, it is important to
consider a set of factors (sometimes referred to as the new high 5
or outcomes-based factors) that are consistent with the thinking
and directions of today and the future. The following set of
factors are believed to be appropriate for this purpose.
1. Technical performance-This consists of diagnostic accuracy,
sensitivity, and specificity.
2. Diagnostic impact-Does the procedure in question affect the
diagnosis? That is, does the procedure provide additional useful
information that will alter the conclusion regarding the
3. Therapeutic impact-Does the procedure in question affect the
therapy? That is, does the procedure provide additional useful
information that will alter the course of the proposed
4. Patient outcomes-Does the procedure in question affect the
morbidity and mortality of the patient? In radiology, there is
concern about the feasibility of performing a measurement of
outcomes for the radiology portion of a study.
5. Cost-effectiveness-Is the procedure cost-effective relative
to existing procedures that are being utilized with existing
equipment? Measurement of cost-effectiveness would combine factors
3,4, and 5 under patient-driven purchasing criteria.
It is apparent that the effect of managed care has widely
modified the thought process associated with the purchase of
equipment. The new high 5 have a clear direction in terms of the
patient, which was almost totally lacking in the old high 5.
Decisions being made today regarding the purchase of equipment
either rely on the old high 5 or contain a blend of the
specification-based and outcomes-based factors. The difficulty in
the conversion coming to fruition is a combination of the general
difficulty in changing as well as the difficulty in reaching
agreement on the definitions of outcomes.
Manufacturer as consultant
This is a natural progression of the "total service" element of
the old high 5 discussed above.
In the days of x-ray, service meant reliability of the
equipment. As CT and ultrasound came on the scene, applications
became an important part of servicing the customer. MRI brought
with it the need for the manufacturer to assist the customer with
marketing. This was especially true for the private outpatient
market. As PACS entered the scene, the need for long-range planning
became evident, and the manufacturer often provided this service
using internal or consulting personnel.
The buzzword today is "asset management." Within asset
management, some manufacturers include equipment planning,
productivity enhancement through reengineering of process,
multivendor service, and so forth. The right approach for tomorrow
may be found by considering the changing role of consulting.
As a business, consulting is changing from providing customers
with the right answers to "enabling the customer" to generate the
right questions. With the right questions in hand, the customer (as
part of a team) will be able to establish the scenarios leading to
the right answers. The consultant would be available to serve as
facilitator. Strategic thinking is a technique that uses "tools" or
"frameworks" to facilitate the process of enabling. The concept of
"strategic thinking in radiology" was introduced last year in an
article in Applied Radiology.1 Many of the tools noted below can be
found in that article.
Strategic thinking is a very meaningful approach to medicine,
considering the situation in which clinicians and, in particular,
radiologists, find themselves. The advent of managed care has
created perhaps the most difficult situation with which radiology
has ever been confronted. Practices are being combined, reduced in
size, and, in some cases, eliminated. In this environment, answers
(often different from different sources) are very confusing at
best. The radiology team must be able to understand what is going
on around them and play an active role in determining the questions
and answers associated with their future.
To enable the customer, it is important to understand the
management process that a radiology practice would be considering
regarding the purchase of equipment. The following steps have been
found to be representative in many situations (the appropriate
strategic thinking tool will be included in each step of the
1. The practice needs to understand how it wants to be
positioned in a three-to-five-year time frame. Associated with that
position, the decision makers must determine the strategic steps
required to attain the desired position.The vision statement tool
is appropriate. An example of a vision statement is found in the
2. Consistent with step 1, the equipment requirements
(acquisition devices, PACS, networks, etc.) are selected as a
function of time over the period. The growth development tool is
3. As an equipment milestone is approaching, an evaluation of
the necessity to purchase is determined based on the current
situation. The real-win-worth tool is appropriate.
4. A review of the requirements within the "regionalized
healthcare environment" and the fit of the equipment in question
are then carried out. The core tool is appropriate.
5. Once a positive decision is reached regarding purchase of a
specific type of equipment, an analysis is required to determine
the best source of supply. The high 5 tool is appropriate (see the
6. Cost needs to be analyzed from a system perspective, taking
into account initial equipment cost, service, up-grades, etc. The
total tool is appropriate.
7. To ensure success of utilization of the equipment in
question, the highest levels of productivity (reengineering of
process) need to be achieved. The two-by-two tool is
8. Management of the entire process requires a team effort with
clearly defined responsibilities. The sheet-of-music tool is
Manufacturers that provide the type of consulting described
above will be able to differentiate themselves from their
competition and provide the best service value to their
Innovations in technology continue in a highly selective
PACS is clearly one of the main areas for investment in research
and development. Over 30 companies are participating in some aspect
of extending the forefront of PACS technology (see discussion
above). Other areas that are receiving significant investment
resources in the diagnostic imaging field include the
Ultrasound-More than 20 companies are providing investment in
this modality. Areas of focus include high-performance imaging
(high frame rates, large FOV, higher resolution), 3D imaging,
breast imaging, and PACS/network-related products.
Digital mammography-This area remains one of the last segments
of medical imaging to turn to digital technology. Technical
developments fall into the categories of area detectors and
line-scan detectors. Materials include silicon for direct detection
and CCDs using scintillators. All combinations were shown at the
Digital detection (excluding mammography)-This is focused on
repla-cing image intensifiers, computed radiography systems, and
detectors for nuclear medicine and PET. Silicon and selenium are
among the technologies being considered.
X-ray-In order to increase value, manufacturers are creating
systems with greatly increased flexibility as "multipurpose rooms."
Radiography, RF, vascular, and interventional procedures can now be
performed with a single system configuration.
MRI-Although more than 15 participants continue in MRI, the
number of new developments has slowed. Magnetic resonance-guided
therapy, specialty scanners, and low-field open systems appear to
comprise most of the new development.
CT-As with MRI, CT has seen a reduction in new developments.
Helical scanning continues to be one area of development that is
receiving attention. Additional areas for future development are
noted in the editorial.
Alliances, acquisitions, and mergers
Such agreements are expected to continue along the path that has
been evident during the last few years.
A major factor that is accelerating this trend is the lack of
profitability of small companies. A study performed by WDI Capital
Markets shows that profitability was elusive for the majority of
healthcare companies with revenues under $25 million.
Large-scale companies have set the tone for growth through the
implementation of an aggressive acquisition strategy. They have
gained strength from increased market penetration and the classic
economies that come with consolidation. Conversely, smaller
companies are finding it more difficult to compete against larger
firms, as buyers increasingly negotiate exclusive agreements for
"bundled" products and services at discounted prices.
A representative example of the acquisition strategy can be
found in Trex Medical. Through a series of acquisitions, Trex has
become one of the fastest growing companies in the field of
diagnostic imaging. Acquired companies include Lorad, Bennett
X-Ray, Continental X-Ray, and XRE. Trex, a division of Thermo
Electron, is following in the path of its parent. The corporate
philosophy has been to grow through acquisition.
Another example of interest can be found in Sterling Diagnostic
Imaging. Sterling acquired the Diagnostic
Imaging Division of DuPont and the Helios Division of Polaroid.
Sterling is betting on the combination of digital imaging and
high-performance film technologies.
Positron's acquision of GE's PET program (acquisition in
process) is an example of a new trend. In this case, the small,
niche company is becoming a dominant player in the niche, while the
large company removes itself from a market that is too small to be
worth the effort. Positron will supply the product to GE's
specifications so that GE can continue to offer its customers a
complete line of products. AR
1. Schilling RB: Strategic thinking for radiologists. Appl
Radiol 25(8):11-14, 1996.