This report originally appeared in the September 2011 issue of DOTmed Business News

Despite a struggling economy, MRI continues to be at the top of the equipment wish list for many hospitals and medical facilities. And that hasn’t been lost on manufacturers, with several introducing new scanners over the past year. Yet as the sector continues to make advancements that improve the patient and user experience, it also must adapt to increasing financial hardships and a changing health care system. MR experts agree: moving forward, everyone will have to learn how to do more with less.

MRI sales in the U.S.
In 2010, approximately 575 MRIs were sold in the United States, according to Isuru Silva, a research analyst for Millennium Research Group, which provides market intelligence on medical technology. Silva is the author of the report “US Markets for Diagnostic Imaging Systems 2011,” released in December 2010.

“Sales were slowed in both 2009 and 2010. However, we’re seeing some recovery into 2011 and that should continue going forward slowly over the next two years,” says Silva. “I think the major impact of this market right now is that the overall market is being saturated, just in terms of most facilities already having an MRI system and they’re for the most part running under capacity.” Silva believes, in the future, most MRI sales will be replacement sales.

According to Silva, out of all the MR units sold in the country in 2010, 64 percent were 1.5 Tesla; 26 percent were 3 Tesla; and 10 percent were open-bore systems. He says the open MRI market has been growing a little. “There are a couple of systems right now that have a higher field strength,” he says. “That used to be one of the limiting factors of these open systems; the image quality was poorer. But now with the higher field strengths, we’re seeing some growth in this segment.”

What’s new with the OEMs of MRI?
Milind Dhamankar, the senior director of product marketing for MRI at Siemens Healthcare, says its MRIs have been selling well. In June 2011, the Food and Drug Administration approved Siemens’ Biograph mMR, a hybrid imaging system that is the first of its kind to combine MRI and PET. “No other vendor has this technology,” says Dhamankar of the time-saving scanner. When it comes to selling MRIs, Siemens’ main customers include hospitals, research centers, universities and diagnostic imaging facilities. Dhamankar estimates Siemens currently conducts approximately 25 percent of its business in the U.S. and 75 percent internationally.

During the 2010 Radiological Society of North America’s annual trade show in Chicago, GE Healthcare introduced two new MRIs, says Jacques Coumans, the OEM’s general manager of premium and interventional MR. The new systems are the Optima MR450w, a 1.5T wide bore scanner; and the Discovery MR750w, a 3T wide bore scanner, which is currently pending FDA approval. Both units feature Geometry Embracing Method (GEM) technology, which Coumans explains is coil technology that uses a lightweight, ergonomic design to “maximize patient comfort” for small field of view detail studies and whole-body reviews. GE Healthcare, which sells MRIs to a variety of customers—including hospitals, private imaging facilities and academic institutions—currently conducts approximately 50 percent of its business in North America and 50 percent internationally, Coumans estimates.

According to Steve Mitchell, the senior director of MR for Philips Healthcare, the OEM introduced the Ingenia, an MR system that received FDA clearance in April 2011. The Ingenia, available at 1.5T or 3T strength, is the first digital broadband MRI. In the machine, “the analog digitization conversion is actually done on the surface coil itself,” says Mitchell, who explains that this process usually takes place away from the magnet and patient. “By [converting on the coil surface], we are increasing the signal-to-noise ratio of the system by up to 40 percent, and that’s providing a much, much better image quality for the physician. And it’s allowing the scanner to go faster.” Mitchell approximates that the business of Philips Healthcare is divided equally between North America and the rest of the world. The company sells to various hospitals, imaging clinics and academic centers.


Suresh Narayan, Toshiba America Medical Systems’ senior manager of market development for MR business, tells DOTmed News about the OEM’s new Vantage Titan 3T, an open bore MRI that recently received FDA clearance and will be featured at this year’s RSNA show. According to Narayan, the 1.5T Vantage Titan is currently the company’s most popular MRI. Toshiba’s business in the U.S. is primarily with large hospitals, says Narayan. “Most of the sales are moving from the imaging centers marketplace to the main hospitals.”

Although Hitachi Medical Systems America has not introduced any new MRIs over the past year, they have been making improvements to their existing platforms. “We’ve done some very important software enhancements, body imaging in particular,” says Shawn Etheridge, the OEM’s director of MR marketing. The Oasis 1.2T is currently the most in-demand model of MRI at Hitachi, whose customers are a mix of imaging centers and large hospitals, most of which are located in the U.S. “The system is actually a great general purpose imager. We have lots of customers that choose it as their only MRI,” says Etheridge of the scanner, which has open architecture and a vertical-field magnet. “We also have folks that are using it for some specialized applications . . . like for pediatric imaging.”

MRI in the field and being fielded
Dr. James Thrall is chairman of the radiology department at Massachusetts General Hospital, located in Boston. He tells DOTmed News that the facility currently has 13 clinical MRI systems, some of which were purchased outright, and some of which are leased or rented. Of the 13 scanners—four of which are 3T—eight are manufactured by GE and the remaining five by Siemens.


“We have had, for the last ten years or so, a fairly close research relationship with Siemens and it has been easier to translate our new discoveries from the Siemens research equipment we have to the Siemens clinical equipment,” says Thrall, who mentions that the hospital purchased two Siemens MRIs within the past year. “One of the new units is in the operating room, where it is actually on a ceiling-mounted track and can be used in either one of two different operating rooms to support our neurosurgeons,” he says. “This is becoming somewhat more common around the country, to have dedicated MR units in the operating room. Still not common, but becoming a little more common.”

Thrall explains that having an MRI in the operating room is helpful because transporting extremely sick patients can be a risky process. He says the hospital can use an MR scanner for 12, 15 or even 20 years. “What we try to do is periodically update our systems to the latest version of the operating software and electronics being used by the respective vendors,” he says.

Inland Imaging is a private radiology practice based in Spokane, Wash. CEO Steve Duvoisin estimates the company uses approximately 10 MRIs, most of which are manufactured by GE, and all of which have been purchased outright. The majority of the units are 1.5T except for one, which is an open-bore Hitachi MRI. In March 2011, the company bought its latest MRI, a GE 1.5T unit. Duvoisin says Inland Imaging is much more likely to purchase a refurbished machine before buying a brand new system. “It has to be pretty compelling technology to get us to buy a new scanner anymore,” he explains. When asked how his practice has been doing in terms of patient volume, he says, “It has come back from last year, last year was down . . . it hasn’t come roaring back, but it’s come back a bit.”

Randal Walker is the vice president of sales for the mobile operations department of Genesis Medical Imaging, an Illinois-based company that services and sells refurbished MRIs. Out of the two dozen countries it operates in, Walker estimates Genesis conducts 70 percent of its business in the U.S. and 30 percent internationally. He tells DOTmed News that the company—whose primary customers are hospitals—mainly performs service on MRIs manufactured by GE, Siemens and Philips.

The effects of health care reform
As is the case with many aspects of the medical industry, the MR sector has been and will continue to be affected by the ongoing health care reform. In the years to come, more and more Americans will begin to acquire health insurance, which means there will be an increase in the amount of patients who need MRIs. As a result, says MRG’s Silva, “facilities might start purchasing used systems in preparation for that increase in procedure volume, and I think that will kind of offset any kind of potential decline that we might see caused by reimbursement cuts.”

Regarding health care reform, Mass. General’s Thrall tells DOTmed News that non-hospital facilities billing Medicare through the Part B have really felt the pain when it comes to MR procedures. “I think it’s made it more challenging, particularly for non-hospital outpatient facilities. The non-hospital outpatient facilities have really been hit the hardest because they were hit with the DRA [the Deficit Reduction Act], and then they were hit again with the PPACA [Patient Protection and Affordable Care Act] . . . then CMS [the Centers for Medicare and Medicaid Services] has implemented what they call the multiple procedure rate reduction rule, where if you image contiguous body parts the reimbursement is decreased.”

Due to the transforming health care system, Hitachi’s Etheridge says customers have to be more efficient and will need a scanner that can be used across the “broadest range” of patients. “I think work flow becomes exceedingly important,” he says. “If your per-head reimbursement’s going down, you’re going to be looking for more heads and you’re going to be looking for more scans to do.”

According to Philips’ Mitchell, the growing need to scan more patients each day has caused OEMs to strive towards creating more productive systems that address issues such as patient throughput, scanner efficiencies and ease of use.


Another health care-related challenge facing the MR sector is the new Medicare Improvements for Patients and Providers Act, which will require non-hospital imaging facilities to become accredited by the beginning of 2012 in order to remain eligible to receive Medicare reimbursement for MRI, CT, PET and nuclear medicine tests. The two primary accrediting bodies are the American College of Radiology and the Intersocietal Commission for the Accreditation of Magnetic Resonance Laboratories.

The MRI accreditation process, which is conducted primarily via mail, evaluates each facility’s quality control, medical staff, equipment performance, clinical image quality and safety standards. After earning accreditation, an imaging site is awarded a three-year certification, during which time it will receive an unannounced visit from the CMS or accrediting body. If a facility does not pass the accreditation process, it is permitted to appeal the results or reapply.

The sky’s the limit
MRG predicts the total value of the entire MRI market will grow between 1.7 and 2 percent over the next half decade. “I think that most of the growth is going to be focused toward the 3 Tesla systems,” Silva says. He believes 3T MRIs could go from being approximately 26 percent of the MRI market to 30 percent in 2015, largely driven by the need for higher throughput. “That’s going to be even more important in about 2013, 2014, when the health care reform impact takes place, when a large number of previously uninsured Americans are going to finally have insurance, and that should provide some boosts in terms of procedural volumes in the U.S.”

Does that mean that 3T MRIs are on the brink of replacing 1.5T systems? Not necessarily. “Right now 1.5T is still [dominant] and I think there’s a lot of opportunities there for the foreseeable future for 1.5T,” says Etheridge, “3T is a very, very powerful platform and there’s been some recent enhancements that have kind of addressed some of the longer term problems . . . but I’m not sure it’s ready to displace 1.5T as a clinical workhorse.”

Etheridge believes that in the years to come, the MR sector is going to become increasingly concerned with the patient experience. “I think in the past you could kind of just scan people and they would sort of put up with anything but I think now . . . you have a choice [in equipment] out there and folks are sensitive to this now.”

Mitchell feels that the MR sector needs to work harder at addressing the consumer’s needs and to “continue to look at the customer’s total cost of ownership through things like upfront costs, installation costs, and costs of upgrading the system during the ownership period,” he says.

“The technology will move forward spectacularly and relentlessly,” says Thrall in reference to future of MRI. “The financial forces on the health system will also be relentless with downward pressure on reimbursement and increasing difficulty maintaining state of the art facilities.”

Suresh Narayan also forecasts that MR technology will continue to grow. “There’s going to be more and more innovation done in either magnet technology or gradient technology or RF chains technology,” he says. “There’s going to be new technology, new innovation in pretty much all areas of MR and it will continue to serve the population . . . I see a bright future for MR.”

DOTmed Registered MRI Sales and Service Companies

Names in boldface are Premium Listings.
Domestic
David Stopak, A. Imaging Solutions, AL
DOTmed Certified
DOTmed 100
John Bachellier, MBI-USA, CA
Bruce Smith, Medical Systems Technologies, CO
DOTmed Certified
DOTmed 100
Frank Pontillo, ens, FL
David Denholtz, Integrity Medical Systems, Inc., FL
DOTmed Certified
DOTmed 100
Anna Srb, Kopp Development Inc., FL
Edward Detwiler, Edward G. Detwiler & Associates, Ltd., IL
Wes Solmos, Creative Foam Medical Systems, IN
DOTmed Certified
Michael Krachon, IMEDCO America Ltd, IN
Jeff Sirk, Majestic Medical Solution, LA
David Pac, American Radiology Resource, MD
DOTmed Certified
DOTmed 100
Jose Pons, Imaging Service Solutions, MD
Steve Rentz, Block Imaging International, MI
DOTmed 100
Jeff Rogers, Medical Imaging Resources Inc., MI
DOTmed 100
Joe Merz, TopLine Medical, ND
DOTmed 100
Alison Fortin, Global Inventory Management LLC, NH
DOTmed Certified
DOTmed 100
Joseph Jenkins, International Imaging Ltd., NV
Tim Wright, Virtual Medical Sales Inc, NY
Paul Zahn, Shared Medical Services, Inc., WI
DOTmed Certified
DOTmed 100

International
Imad Muati, IMC, Syria
DOTmed 100
Osvaldo Lara, SMA, Argentina
Jiffy Paul Akkarakaran, Magna Digitech, India