Ben White

Radiology Partners Enters the Lending Business

12.18.23 // Radiology

Update 1/11/2024:

The specific practice loan that I referenced as giving rise to this post began earlier in 2023, and this post was months in finalizing. I’d originally intended to publish it in the summer. Since publishing, I’ve since learned that RP’s extra support has briefly paused.

That’s right, at least for a month or two, the group’s compensation reached the threshold that turned off the “advance” from RP. Hospital subsidies saved the day. Note that the loan term itself isn’t over, and after briefly not needing it, the group has since required more gravy.

Ultimately, this suggests that RP may have chosen the loan method for supporting this practice because they had specific reasons to (correctly?) believe that the loan period would be time-limited: It’s obviously better to give some money temporarily in a non-binding fashion to save a group in crisis than to permanently change the contract if you don’t have to.

The real question for the future will be: will the group consistently earn enough in the end to pay back several million dollars of borrowed money, and if so, how long does that take? And/or, does the group fight it? It sounds like what  seemed like free money at the time may ultimately be an actual loan, and paying back that advance will therefore constrain compensation going forward unless long-term profits stay below the mark due to increased contractor use, the need to sweeten up internal moonlighting rates, or understaffing requires dropping volumes. Any or all of those things may happen. They are things happening at groups of all stripes across the country.

The future remains uncertain as always—and RP may still never recoup this loan—but this also means that I was wrong in how easily I dismissed the likelihood of RP seeing some of this money back.

This month credit agency Moody’s downgraded Radiology Partners again (surprising exactly no one): the first (and smallest) of its large debt obligations is due in 2024, they currently owe 10x their earnings, and they can only service these debt obligations through refinancing, which is challenging in the current market even before you consider the potentially tenous state of RP’s acquired practices when they reach their 5-year vesting window. It was inevitable.

If you ask RP, they will tell you that all third parties—whether Moody’s or just a random internet troll like myself—don’t understand their business and aren’t privy to the magic happening behind the scenes.

They consistently maintain that they will be able to refinance, though they never publically acknowledge that the most likely refinancing they will achieve is some form of distressed exchange like a debt-to-equity swap that would likely dilute current shareholders (and is considered a bankruptcy equivalent).

Here’s a slide from their big meeting earlier this year:

I know some people in the radiology community think that when the debts come due that RP will go bankrupt and disappear, but that’s simply not going to happen. Depending on how broadly one defines “success,” there’s an excellent chance they’ll be successful. (To wit, Envision emerged from bankruptcy in the hands of its creditors, but it didn’t go anywhere.)

But here is something you haven’t seen in the news but is nonetheless interesting:

Radiology Partners—already dealing with recurrent credit downgrades, cashflow problems, and investor fears—has been offering no-interest loans to some of its practices to shore up compensation.

Note: I’ve heard a similar story independently from several RP radiologists, but I do not know how common the offer has been (I suspect not very). For what it’s worth, I did reach out to RP and Melinda Collins (AVP of Marketing and Communications) on Twitter/X last week without a response. If you’re at RP and want to weigh in on this purported practice, please reach out. If I’m wrong or misleading in any way, I really, really want to know.

To my knowledge, nobody has pressed RP on this issue yet, and it has not been discussed in any public forum other than a brief mention on this site earlier this year in a quotation from a former RP radiologist. Since that time, I heard from multiple sources that at least one practice has taken the offer, hence this post.

So how does this look in practice? Let’s discuss.

(more…)

Radiology Toys (TL;DR)

12.14.23 // Radiology

I wrote a long post with lots of options for the best personal radiology equipment (and additional posts about using a left-hand device or implementing the magic of AutoHotkey for achieving hands-free dictation and efficiency).

But gosh, all those words!

For the use-with-your-hands part, here are some quick contexts and a single choice for each that you can implement wherever you work:

Mouse:

  • Wrist hurts + want magic buttons and/or can’t install software: Zelotes C18/TRELC
  • Wrist hurts + normal buttons and/or can install software: MX Vertical
  • No wrist pain + Goldilocks (good but not insane amount of magic buttons, on-board memory means no software needed at each computer): G604 Lightspeed
  • No wrist pain + ludicrous number of buttons: UtechSmart VenusPro
  • Debilitating wrist pain please help nothing is working: Roller Mouse

Off-hand:

  • Left-hand device with buttons and scrolling behavior: Contour Shuttle Pro V2 (read more here, software required)
  • Left-hand device with buttons and on-board memory: ELSRA Smart (cheap, labelable)
  • If you’re adding an off-hand device, you’ll want something to hold the dictaphone near your face. A cheap clamp like this works great.

Note: I didn’t get into any of this stuff until I became an attending, but looking back, it is insane that I was just using the garbage plugged into the workstation wherever I sat down.

While not everyone wants or needs to go full-on mega nerd with a hands-free setup and a left-hand device (though it’s awesome and I kind of do think everybody should), even residents would benefit from at least an inexpensive gaming/productivity mouse, especially for call when speed matters (it’s also during those night float months that many of us first began to experience repetitive stress injuries from bad ergonomics and inefficient workflows.) Optimizing is a worthy investment of time/energy/money.

Paying Attention to Attention

12.13.23 // Miscellany

From “Burned Out on Burn Out” by  Sanj Katyal MD:

As we get older, time seems to fly faster and faster.

And it’s not just a hackneyed expression (it’s that too, of course), but studies really show that we experience time differently as we age. One argument is that we feel time as a fraction of our conscious experience. 5 minutes for my 4-year-old daughter is a much bigger percentage of her life than it is of mine, which is smaller still than for my father in his 70s. Others have argued we experience time as a matter of novelty. When we’re young, everything is novel, and so each day is filled with new things that demand our attention. Less so our more repetitive adult days filled with commutes and office jobs.

Our ability to pay attention to our time is the main thing that has changed.

When we were young, everything was new and captivated our attention. We were fully present as we learned about ourselves and the world around us. As we got older, however, we settled into comfortable routines and mental models of life. The simple wonders of each moment were no longer enough to hold our attention. Play was replaced by work, close conversations with friends were replaced by quick texts and each day started to feel the same. There was not much new to learn or experience in our daily routines so we began looking forward to the weekend, our next vacation or even retirement. This only served to speed up time even more. Many of us are bored with our lives. We seek adventure and new experiences, even if only found on our phones. We can do better.

The problem, whatever the explanation, is that we don’t want time to fly. We don’t want the days to flow into weeks to months to years in a wave of sameness punctuated by rare major events, some of which will inevitably involve hospitals and funerals. Without attending to the day-to-day moments (i.e. the boring stuff), we find ourselves looking forward to the end of the workday or pining for the weekend when we can binge on sleep or entertainment. That boredom and frustration can make us paradoxically want time to speed up for a big fraction of our days just to get to the good stuff.

One truism is that if you do what you love you’ll never work a day in your life. I think this is backward for most people, who don’t magically love things that provide a steady paycheck.

The more achievable goal, especially for someone who finds themselves working a job that doesn’t exactly organically spark joy is to love what you do.

Dr. Katyal argues the solution is to cultivate attention and novelty:

The solution to boredom and routine is to cultivate attention, constraints and novelty about everything we do.

If we can really pay attention to what we are doing (and we do this by imposing some constraints that force us to focus), we can find new things about the task, different ways to do things, and notice something we never noticed before.

This provides novelty which in turn infuses a sense of wonder/fun into our lives.

Playing catch again with my son? How can I throw the ball even harder or ask different questions to have a deeper conversation while catching?

Reading another 100 cases today? Can I identify a subtle finding that explains the patient’s symptoms? Can I read the imaging study like it was my mom’s scan? Can I be thankful that I am able to read a complicated CT and think back to my training when things like this seemed so hard?

Sometimes I think about this reframing: the thing isn’t boring, you’re boring. Boredom isn’t something forced on you, it’s a frame of mind you choose when your lizard brain isn’t being stimulated.

So, maybe, the solution: be less boring.

People like to operate under the belief that services like anesthesia, radiology, and pathology are totally interchangeable commodities. We do the work but don’t generate it, and patients generally don’t get to pick.

But in the real world, labor isn’t as cog-like as you might think, and culture matters (yes, even in our dysfunctional healthcare system).

Here, enjoy this story of a failed private equity anesthesia takeover.

// 12.12.23

The Feigned Complexity of Simple Things

12.08.23 // Medicine

From Humankind: A Hopeful History by Rutger Bregman:

That’s right, Buurtzorg [a nurse-led home healthcare organization] is better for patients, nicer for employees and cheaper for taxpayers. A win-win-win situation. Meanwhile, the organisation continues to grow. Every month, dozens of nurses leave other jobs to sign on with Buurtzorg. And no wonder: it gives them more freedom and more pay. When Buurtzorg recently acquired part of a bankrupt counterpart, de Blok announced: ‘The first thing we’re going to do is raise staff salaries.’

Don’t get me wrong: Buurtzorg isn’t perfect. There are disagreements, things go awry–really, they’re almost human. And the organisational structure is, if anything, old-fashioned, with de Blok’s aim always having been a return to Holland’s uncomplicated domestic healthcare services of the 1980s.

But the bottom line is that what Jos de Blok started back in 2006 is nothing short of extraordinary. You might say his organisation combines the best of left and right, spending taxpayer money on the delivery of small-scale care by independent practitioners.
De Blok sums up his philosophy like this: ‘It’s easy to make things hard, but hard to make them easy.’ The record clearly shows that managers prefer the complicated. ‘Because that makes your job more interesting,’ de Blok explains. ‘That lets you say: See, you need me to master that complexity.’

The complexity is both a feature and a bug.

Could it be that’s also driving a big part of our so-called ‘knowledge economy’? That pedigree managers and consultants make simple things as complicated as possible so we will need them to steer us through all the complexity? Sometimes I secretly think this is the revenue model of not only Wall Street bankers but also postmodern philosophers peddling incomprehensible jargon. Both make simple things impossibly complex.

Layers upon layers of bullshit jobs.

Jos de Blok does the opposite: he opts for simplicity. While healthcare conferences feature highly paid trend-watchers auguring disruption and innovation, he believes it’s more important to preserve what works. ‘The world benefits more from continuity than from continual change,’ he asserts. ‘Now they’ve got change managers, change agents, and so forth, but when I look at actual care in the community, the job has scarcely changed in thirty years. You need to build a relationship with someone in a tough situation; that’s a constant. Sure, you may add some new insights and techniques, but the basics haven’t changed.’

There is a ton of inefficiency in healthcare, but most of it is around and distracting from the actual care of people’s health: billing games, crufty software and documentation, and agonizing compliance schemes. But, it’s also true that real healthcare—taking care of actual humans—should also be at least a little “inefficient”: it takes time to treat people like three-dimensional humans deserving of dignity, respect, and a real conversation.

What does need to change, De Blok will tell you, is the care system. In recent decades, healthcare has been colonised by lawyers. ‘Now you’re in opposing camps. One side sells, the other buys. Just last week I was at a hospital where they told me: We have our own sales team now. It’s crazy! We have hospitals with commercial departments and procurement teams, all staffing people with no background in healthcare at all. One buys, the other sells, and neither have a clue what it’s all about.’

The number of decision-makers in healthcare who do not understand healthcare remains astonishing.

All the while, the bureaucracy keeps proliferating, because when you turn healthcare into a market, you end up with piles of paperwork. ‘Nobody trusts anybody else, so they start building in all these safeguards; all kinds of checks that result in a ton of red tape. It’s downright absurd,’ says De Blok. ‘The number of consultants and administrators at insurance companies is growing, while the number of actual caregivers continues to shrink.’

De Blok advocates a radically different approach to healthcare funding. Scrap the product mentality, he says. Make care central again. Drastically simplify the costs. ‘The simpler the billing, the greater the emphasis on actual care,’ he explains. ‘The more complicated the billing, the more players will search for loopholes in the system, increasingly tipping the balance towards accounting departments until they’re the ones defining care.’

“Scrap the product mentality.”

“Make care central again.”

“Drastically simplify the [billing/]costs.”

The Emergency Mind

12.04.23 // Medicine

A passage about the fear of consequences from The Emergency Mind: Wiring Your Brain for Performance Under Pressure by Dan Dworkis MD PhD:

In or out of the emergency department, all emergencies share three common structural characteristics:

• Emergencies involve uncertainty.
• Emergencies have high-impact outcomes.
• Emergencies occur under significant pressure.

Whatever the potential impact of a situation is, fear of this impact can lead to paralysis; you can find yourself unable to make a decision because you are so preoccupied with what the impact might be. Of course, not making a decision is, in and of itself, a decision.

A big part of residency training is just accumulating enough reps that you aren’t paralyzed by indecision, especially when stressed or confronted by novelty.

More broadly: even abdicating a decision to maintain the status quo is itself a decision. There is no escape from time, which will always take us from point A to point B.

The consequences will come. The question is, will you make deliberate choices to achieve the best outcome? Will you reflect on not just your outcomes but also your process to ensure you grow?

 

Private Equity & Piracy Metaphors

11.17.23 // Finance, Miscellany

Time horizons, incentives, and moral hazard: a very enjoyable easy-listening zoomed-out discussion of the Private Equity industry on the Freakonomics podcast.

If you find the discussion of healthcare and PE on this site and others to be too tedious and haven’t learned more about this very large and very important industry, this is a great well-produced episode.

It includes an interview with Brendan Ballou, author of Plunder: Private Equity’s Plan to Pillage America.

(Which is not to be confused with These Are the Plunderers: How Private Equity Runs—and Wrecks—America by the Pulitzer Prize­­­–winning Gretchen Morgenson…there’s a theme here.)

The UnitedHealthcare vs Radiology Partners lawsuit went to arbitration instead of a jury trial last month. Last week, the arbitration panel ruled in favor of RP and its practice Singleton Associates, awarding them $153.5 million.

United, for its part, says it’s not done, and that there are still unaddressed counterclaims. From that Radiology Business article: “We do not agree that Singleton will recover an award from UnitedHealthcare,” the Minnetonka, Minnesota, company said.

// 10.24.23