Radiologists offer a governance blueprint for hospital joint-venture partnerships

Two radiologists are offering peers a governance blueprint for building future joint venture partnerships. 

Hospital outpatient volumes in the U.S. continue to decline as patients migrate to freestanding facilities offering lower copayments and greater convenience, experts write in Academic Radiology. To respond, many radiology practice-management companies are increasingly forming joint venture partnerships with health systems and academic medical centers. 

This allows both sides to retain imaging market share, access capital, deploy AI and “generate revenue amid reimbursement pressure,” Mayur K. Virarkar, MD, MBA, and Dheeraj Reddy Gopireddy, MD, MBA, both with the University of Florida Health Jacksonville, write Aug. 19. 

The two radiologists are warning colleagues about a common pitfall, found from reviewing 30 years of JV research. 

“When financial incentives are not structurally separated from clinical authority, diagnostic quality degrades,” Virarkar and Gopireddy charge. 

To help others, UF Health Jacksonville has created a new “Blueprint for Diagnostic Imaging Excellence.” Their roadmap was created by synthesizing stakeholder governance theory, three decades of joint-venture literature, and Donabedian’s quality framework. The latter is a conceptual model created by physician Avedis Donabedian, MD, in 1966. It evaluates healthcare quality utilizing three linked parts: structure, process and outcomes. 

Based on their analysis, the two rads recommend assigning “nondelegable” clinical quality authority—i.e., accreditation, peer review, radiation safety and AI approval—to the radiology group. Meanwhile, full operational authority should go to the hospital or other JV partner, using a co-chaired “joint quality committee” as the interface. 

Virarkar and Gopireddy have developed a 13-domain responsibility matrix, with five contractually enforceable quality-protection provisions. These include a “volume-quality firewall” prohibiting linkage of physician compensation, scheduling or contract renewal to imaging volumes. It also offers a “physics veto authority,” which protects the radiology practice from failing medical equipment. 

Other elements of the blueprint include a “seven-trigger escalation protocol,” with thresholds calibrated to American College of Radiology benchmarks, such as a 3% imaging-rejection max. Radiology practices hold final, nonappealable authority on what constitutes a clinical-quality matter, and the department chair is named the arbiter of that boundary. The blueprint additionally details audit and accountability mechanisms that operationalize this model. Plus, there is a “Diagnostic Imaging Centers of Excellence” pathway that aligns quality with shared financial return.

Virarkar and Gopireddy hope their work can help both hospitals and radiology groups avoid some of the common mistakes encountered when inking a new deal. 

“The framework is a template, not a prescription: JV arrangements are heterogeneous, and each element requires local adaptation to practice model market, and negotiating leverage,” they caution. “For academic departments, the nondelegable assignments preserve the quality infrastructure central to the academic mission; for private groups, the firewall and noninterference clause protect clinical independence; for hospital administrators, the [Joint Quality Committee] provides an accountable, co-chaired oversight mechanism. The [Diagnostic Imaging Centers of Excellence] pathway aligns incentives across practice models around a shared quality credential.”

Read much more, including potential study limitations, in the official journal of the Association of Academic Radiology.