Report: vRad’s NightHawk Acquisition Brings Growing Pains

Virtual Radiologic’s December 2010 purchase of NightHawk, a national teleradiology practice, has come at a cost - at least in the short-term, according to research firm KLAS’s annual teleradiology survey.

“The NightHawk acquisition directly affected the largest customer base of teleradiology,” said Emily Crane, director of teleradiology research at KLAS and author of the recent report. "Many NightHawk customers have reported challenges with turnaround times, and reading physicians have struggled with the transition to vRad's technology since the acquisition,” she said.

Virtual Radiologic (vRad), now the largest radiology practice in the country, came out atop the rankings in last year’s report. The good news for vRad, Crane said, is that most longtime vRad customers said they were “relatively happy and appear willing to ride out the storm. That said, almost half of the former NightHawk customers are looking for other options.”

Customers leaving NightHawk are considering smaller vendors, the report said, including StatRad, a vendor in the western United States. In addition, ONRAD has grown to be a national vendor while maintaining their consistent high performance, according to the report, and Rays’ combination of service quality and turnaround time also gained some business outside of their home Southeast region.

Unlike other regional vendors looking to expand, Imaging On Call (IOC) has pulled back its expansion plans to focus on their Northeast regional customer base. While their overall performance score has improved over the past year, IOC still scores lower than other regional vendors in the 2011 report. IOC was acquired by RadNet earlier this year, and the additional resources may have also helped IOC improve customer satisfaction.

“Turnaround times surfaced as a more critical and top-of-mind issue this year; in fact, much of a vendor’s success hinged on the speed of their turnaround times,” said Crane.

She said Teleradiology Solutions (TRS) had the quickest preliminary turnaround times of the four nationally ranked vendors, and was the number one ranked vendor for 2011.

Most vendors' turnaround times are within a couple of minutes of each other. The exception was Radisphere, which focuses on final and specialty reads. However, Radisphere appears able to manage customer expectations, for the most part, and keep customer satisfaction ratings steady despite slower turnaround times.

Early findings for AltaVista and USTeleradiology were included in the report, but due to a limited sample size, were not ranked. Even though USTeleradiology’s sample size is small, they have customers nationwide. Other smaller vendors, including Aris Teleradiology, Epic Teleradiology, and Sunset Radiology, lacked the market presence for inclusion in the report.