Tag Archives: Market Trend

Signify Premium Insight: GE’s Allia Platform: An Intervention in a Lucrative Segment

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GE Healthcare has recently debuted its latest interventional platform, dubbed Allia, which it hopes will allow it to capitalise on the growing demand for minimally invasive procedures.

The new suite centres around a wide-bore C-arm, and, according to GE Healthcare, has been developed in conjunction with surgeons and interventionalists to better support their needs during surgery. This, the vendor says, will improve the accessibility of the system’s user interface, as well as allowing the suite to be customised to individual surgeon’s needs. The Allia Platform is also offered with GE’s AI-based AutoRight interventional imaging chain, and GE’s AI-based parenchymography software solution.

The Signify View

Because of the high-pressure situations in which it is used, and the inseparable link between imaging and treatment, interventional imaging is unique. Despite these peculiarities that set it apart from other kinds of imaging, it does share one almost universal challenge with its imaging kin: the need for greater workflow efficiency. Improving the efficiency of surgeries and reducing operational challenges are among the guiding tenets of GE Healthcare’s Allia platform. Ergonomics is one area where GE Healthcare has worked to improve surgeries, with one of the key developments being a wide-bore C-arm that is neither floor nor ceiling-mounted, a change which is hoped to make interventional rooms more navigable for clinicians.

In a similar vein, GE Healthcare boasts that it has worked to ensure interfaces, functions and displays – the touchpoints that clinicians interact with on a daily basis, are all easily accessible, enabling surgeons to operate more efficiently. There are also more outwardly sophisticated, if more specialised developments, with GE Healthcare looking to leverage AI to assist with liver embolization procedures as well as manage the dose that patients are subjected to.

All of these tools and capabilities should, assuming they perform as well as GE Healthcare expects, be useful to surgeons. Whether that will be enough to convince providers to buy or upgrade their systems to have access to this new clinician-focused platform is another question entirely.

Users vs Buyers

As large medical imaging vendors are increasingly looking to enter into more comprehensive managed service agreements with providers, effectively becoming partners rather than simply suppliers, decisions are being made higher up in the hierarchy of a hospital network. As such, focusing so myopically on the needs of clinicians, rather than the requirements of the C-suite or finance department could be a risk. However, interventional X-ray is unusual in this regard. Its high-risk nature compared to other areas of medical imaging means that the opinions and preferences of the clinicians that will eventually be using the platform will be given more weight than might be the case for other imaging purchases.

Given this clinician focus, it makes sense for GE Healthcare to focus on, and emphasise in its marketing, the benefits that such a system could bring to surgeons, with improved workflow, enhanced clinical outcome, improved usability, and advanced image guidance all aiming to make interventional teams more efficient.

Despite these improvements being roundly appreciated, the Allia platform does represent the top end of GE Healthcare’s interventional imaging range, and as such comes with a price premium. While this may deter some potential customers, it does offer the halo effect, raising GE’s profile in a segment in which its two chief competitors, Philips and Siemens Healthineers, tend to outperform, especially in developed markets. This alone is unlikely to make a provider switch its allegiance and suddenly adopt GE Healthcares interventional imaging suite, but, by addressing one of the gaps in its portfolio, GE Healthcare is increasing the broader appeal of its overall medical imaging offering and therefore standing it in better stead to become the vendor of choice for a provider entering into a holistic imaging deal. By a similar token, offering a system that rivals the best from Siemens Healthineers and Philips also ensures that interventional won’t be a reason it misses out on such deals.

Competing Interest

This is an important factor. GE Healthcare’s Allia platform does not stand in a field of one, with both Philips and Siemens offering products that have comparable functionality, albeit with their own unique focus, however, the timing of GE Healthcare’s launch will also benefit the vendor. During the Covid-19 pandemic countless elective procedures were canceled because of restrictions to hospitals. This has left providers facing an enormous backlog of postponed procedures which they need to clear. Given this pressure on hospitals, any interventional solution which can improve the efficiencies of interventions, reduce bottlenecks in procedures and improve the workflow efficiency of surgical departments will be warmly received.

There are, however, some differences that do set GE Healthcare’s new solution apart from its chief competitors. One such factor is the inclusion of an AI tool it calls Liver Assist, which is a 3D visualisation solution that GE Healthcare says will provide virtual parenchymography and help clinicians simulate injections dynamically and perform liver embolization procedures. Unlike other vendors which have tended to focus on hardware innovation, and supplementing that with software that is applicable across a variety of different use cases, GE has sought to combine its hardware and software capabilities into one product which addresses a growing clinical use case.

Market Pressure

GE’s approach is, more broadly, also appropriate given the wider trends in the medical imaging markets. Unlike many of the segments in which GE plays, there is limited competition in the interventional market. In some of GE’s biggest adjacent markets, competition has increased rapidly. In general radiography, for example, explosive growth in the number of Chinese vendors targeting both the budget segments and players such as United Imaging targeting ever more premium markets, will start to weigh on GE’s results. With new competitors and lower costs eroding market share and margin. In contrast, interventional imaging is a much more sophisticated segment with much higher barriers to entry for potential competitors. What’s more, given the more critical nature of interventional imaging, providers will be less likely to take a chance on a lesser-known vendor if there is an alternative from a more established player with a robust reputation available.

Against this backdrop, focusing on maintaining and building share in the interventional space is an appropriate strategy. Growth in interventional imaging will also be international. Both demographic factors such as aging populations, higher rates of obesity, heart disease, stroke and other conditions rising, along with the increasing availability of medical imaging in developing markets allowing conditions requiring surgical interventions to be diagnosed, the need for interventional imaging platforms will grow in lockstep.

Ultimately, GE Healthcare’s release of its Allia platform will not dramatically change the complexion of the interventional X-ray market. Providers will not rush to replace their existing systems to take advantage of GE Healthcare’s new workflow improvements or its AI capabilities, and it may not, in the short term, necessarily push providers toward a large comprehensive contract with GE Healthcare. However, some clinicians will notice the release, they will visit GE’s booth at RSNA and assess the consideration that they, and their needs have been given in the update, and, perhaps will start to notice some shortcomings in their own systems. Then, when the time comes, these clinicians tasked with performing some of the most direct tasks in medicine could advocate for a GE system in future. Such patterns may not allow GE Healthcare to overthrow Philips and Siemens, and over time those vendors will also release new systems that will once again swing the balance. But, by focusing both hardware and software innovation on the platform’s users, GE Healthcare may well have boosted its chances in a difficult, yet rewarding, segment.

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Signify Premium Insight: Intermountain Subsidiary Leaves Hospitals Behind

This Insight is part of your subscription to Signify Premium Insights – Medical Imaging. This content is only available to individuals with an active account for this paid-for service and is the copyright of Signify Research. Content cannot be shared or distributed to non-subscribers or other third parties without express written consent from Signify Research. To view other recent Premium Insights that are part of the service please click here.

Amid growing pricing pressure on medical imaging in the US, Intermountain Healthcare recently announced it is launching an outpatient imaging subsidiary under the Tellica Imaging brand name. The first three locations of the new chain of standalone outpatient imaging centres are set to open in late 2021, with five more set to follow in 2022.

As well as operating under a new brand name, the outpatient imaging centres will also offer MRI and CT scans at flat-rate prices which are lower than the same imaging exams in a hospital-based setting.

The Signify View

Some types of imaging examinations will always need to be performed in hospitals. The nature of emergency or interventional imaging, for example, negates the possibility of it being performed elsewhere. For many non-emergency diagnostic imaging exams, however, there is a growing trend for some exams which would typically have been performed in a hospital, to increasingly be taken on by outpatient imaging centres.

The Covid 19 pandemic has been one factor in this shift, with providers trying to keep patients out of hospitals wherever possible in order to minimise their potential exposure to the coronavirus. However, in a bid to rein in healthcare spending in the US, payors have also been increasingly pushing their customers towards outpatient imaging centres, where the cost of imaging exams can be significantly less than in a hospital setting.

More broadly, changes to reimbursement brought about in the latest fee schedule from the Centers for Medicare and Medicaid Services (CMS) is also set to alter the complexion of the medical imaging market. There is a growing body of evidence that suggests the changes brought about in the fee schedule are going to affect single site imaging centres most severely. These smaller independents will therefore find it increasingly difficult to compete with the larger outpatient imaging networks, which can leverage the economies of scale to be more aggressive on pricing. This is one of the factors driving consolidation in the outpatient medical imaging market, which, to an ever-greater degree, is being dominated by large outpatient networks.

An Equal Fight

Hospital groups will be loath to lose business to these imaging groups, and so, in Intermountain’s case, establishing an outpatient network of its own makes a lot of sense. The newly formed Tellica will be able to compete for outpatient imaging business on an equal footing with the other outpatient networks. It will, like its competitors, be able to offer lower cost imaging than in Intermountain’s hospitals.

Payers in the broader market have also played a substantial shift towards outpatient imaging focus, with a number, such as Anthem and UnitedHealthcare, now refusing coverage for non-emergency hospital-based imaging, such is the current discrepancy in price between in-hospital and outpatient-based imaging.

There are many reasons for the discrepancy. Outpatient groups can focus solely on imaging, so are able to tailor their services to efficiently addressing less complex, higher volume imaging exams. In contrast, hospitals must maintain the ability to conduct a broader array of exams and more advanced scans, even if it means purchasing more expensive equipment that is infrequently used and facing the additional staffing costs that comes with more specialised doctors.

Tellica’s spending can also be more focused. The provider will not, in most cases, have to stretch to purchasing the most premium specialised imaging equipment, and instead invest in imaging solutions that can expedite its workflow and enable it to attend to patients more efficiently. Increasing volume and capacity of imaging can also offset the lower reimbursement rate per scan, while also creating opportunity for the health system to bring in new patients. The deployment of AI tools in the outpatient setting may also have a material impact in terms of efficiency and care quality for the provider given its much more myopic focus, with the outpatient setting expected to experience faster adoption of AI versus the hospital setting.

More, and More Affordable

The effects of this shift to outpatient imaging will ripple out across the medical imaging sector. Modality vendors are likely to see an overall increase in the volume of medical imaging equipment being sold. However, this will be balanced by a fall in the premium models as hospitals, which typically purchase the more advanced products, will require fewer systems. Conversely, there is set to be an increase in mid-range ‘workhorse’ models, which will, in most cases, be an outpatient centre’s preference. As such, the market average selling price of systems will fall. This change in the complexion of the market could also see sales leak from premium international vendors, to other cost-competitive vendors, such as United Imaging, which may not be able to compete in the upper echelons of the imaging market but are competitive in the mid-range and keen on pricing. This will move the focus away from top end features, forcing vendors to highlight the fundamental value and efficiency of their systems more clearly.

These changes are also set to have an impact in the imaging IT market. Providers such as Tellica, which grew out of a hospital network, will likely become license extensions opportunities of the  original hospital network’s imaging IT system, utilising the same vendors and the same solutions. This may give the likes of Tellica an advantage from a deal size perspective, enabling them to take advantage of their larger buying power.

There are still some benefits unique to specialist outpatient imaging networks. The opportunity for imaging IT amongst these newly formed networks, is from their nimble structure, allowing them to be reactive to shifts in the market quicker than larger hospitals. In a similar vein these providers are also typically more innovative in adopting new technology, due to the drive for efficiency to remain competitive and profitable. These growing outpatient imaging networks  are therefore likely to be among the first providers to take advantage of informatics vendor’s efficiency-focused products. This could be particularly true as products are increasingly tailored to address the needs of outpatient imaging providers, such as GE’s recently released TruePACS system, for example.

Scale and Efficiency

Intermountain’s launching of Tellica fundamentally represents a hospital network responding to the changing tides in the medical imaging market, and effectively cutting its pricing in the outpatient space to maintain competitiveness. Intermountain is not the first to make such a move but it does highlight the increasing interest in the space. As this interest in outpatient imaging centres grows and more providers look to compete in the space, prices will continue to fall, and margins will  tighten. This will ensure consolidation continues, with it becoming increasingly unfeasible for small independent imaging centres to thrive given they will be unable to capitalise on economies of scale or take advantage of larger, network-wide plays to adopt tools to drive efficiency forwards.

Resultantly, smaller imaging IT vendors will also find it more difficult to compete. Many of their customers are the smaller, independent outpatient imaging providers; as these are replaced by larger outpatient networks with much larger and complex network-wide deals, some of these smaller imaging IT vendors could falter.

Intermountain’s creation of Tellica shows it is willing to adapt to a changing market. It has entered an increasingly competitive and rapidly consolidating space and is hoping to go toe-to-toe with some of fastest growing providers in medical imaging. It can utilise its broader buying power, and the nimbleness that a new brand affords, but key to this success will also be its ability to scale rapidly. The outpatient imaging market is one where scale and efficiency bring success. If Intermountain’s Tellica can achieve both, then it has a strong future ahead.

 

About Signify Premium Insights

This Insight is part of your subscription to Signify Premium Insights – Medical Imaging. This content is only available to individuals with an active account for this paid-for service and is the copyright of Signify Research. Content cannot be shared or distributed to non-subscribers or other third parties without express written consent from Signify Research. To view other recent Premium Insights that are part of the service please click here