Health Care and Technology

Long-distance diagnoses are company's specialty: NearMed to provide radiology services to hospitals

August 21, 2006

An Indianapolis health care startup plans to begin diagnosing patients this fall without actually seeing any of them face to face.

NearMed will venture into the fastgrowing market for "teleradiology" by offering a network of doctors around the clock and radiology subspecialists who work days and evenings to read X-rays and other images transmitted over a secure computer network.

The Intech Park-based company will call on radiologists in Indiana, Texas and Idaho. In addition, it will provide clients with picture archiving and communication systems.

The company will start with one client-Bloomington's 32-bed Monroe Hospital, which plans to open in October-but hopes to branch into other states and eventually pull in as much as $6 million in annual revenue, Chief Operating Officer Tom Bailey said.

Companies like NearMed can fill a vital need by providing smaller hospitals with access to radiologists for emergencies or for subspecialties in areas like neurology, pediatrics or body imaging.

"If you need a radiologist in the middle of the night, you may not find one in North Salem, Ind., but they're falling out of the trees in Indy," noted Duane Sobecki, a senior partner with Sobecki and Associates, an Indianapolis-based health care consulting firm.

But to fill this void, NearMed will have to crack a market crowded with competition. Some 40 companies in the United States and internationally already provide overnight or "nighthawk" reads, with radiologists stationed in Australia, Switzerland and India. Many also work out of Hawaii and Alaska.

NearMed, which so far has five employees, formed last October and has spent $750,000 on infrastructure, building its network of doctors, and other startup costs, Bailey said.

Its technology roots run deep. Bailey, who led software development for Carmelbased Baker Hill Corp., co-founded the company with Managing Director Brad Bostic. He founded the Indianapolis-based e-commerce firm Bostech Corp. and owns the IT consulting firm NearSource.

Physician investors Daniel Grossman and Kamal Tiwari also helped launch NearMed.

The company lined up Indianapolis radiology groups to handle the subspecialty coverage and arranged for overnight reads from the companies in Texas and Idaho.

"We're not trying to just become a night-coverage offering," Bailey said. "We're also not trying to be a virtual bank of radiologists."

NearMed will emphasize matching hospitals or doctors with the specific subspecialty radiologist they need. That, Bailey said, is where the growth lies.

"The real need out here is, you can't really get subspecialty radiologists outside of the major metropolitan ideas," he added.

Technology advances like more powerful computers and digital-format archiving have allowed radiologists to do more remote work over the past decade or so, said Dr. Arl Van Moore of the Reston, Va.-based American College of Radiology. He chairs the college's task force on international teleradiology.

Satellites and fiber-optic networks that extend far beyond hospitals allow care providers to send huge data files out for evaluation. Moore said a typical radiology file can be as large as a thousand pictures or JPEGs that the average e-mailer might send over the Internet.

However, Moore has some concern about quality of cyberspace radiologists. He said anyone providing radiology services should be credentialed at the hospital they work for and certified in that hospital's state.

"Your expectation when you go to a hospital is that all those physicians meet some certain specified standard," he said.

Bailey agrees. Radiologists with licenses to practice in Indiana will handle the subspecialty work for NearMed's clients in that state. If they have state licenses, obtaining hospital credentials "should be straightforward," he said.

Qualifications are less strict for the evening and overnight work. In those cases, the radiologist is charged with giving preliminary, or "wet," reads to an emergency room staff at a hospital, Bailey said. A radiologist licensed in that state then does the follow-up read the next day.

Indiana competition for NearMed includes Northwest Radiology Network in Indianapolis, which provides teleradiology for at least 10 hospitals throughout the state.

Hospitals needed a radiologist on site for proper coverage 10 or 15 years ago, said Jeremy Hough, Northwest Radiology's chief information officer. "It's not necessary anymore," he said.

Northwest Radiology entered teleradiology six years ago, initially working only with St. Vincent Health.

"We're doing it tons more than we were doing it six years ago," Hough said.
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