A report released by market research firm Millennium Research Group (MRG) of Waltham, Mass., finds that the 2005 Deficit Reduction Act (DRA), which slashed reimbursement for diagnostic imaging centers in the United States, is having a major impact on the PACS market. According to MRG, although PACS technology improves operational efficiency, it is a major investment that smaller facilities may not be able to afford.

The report, “U.S. Markets for PACS 2007,” noted that the enactment of the DRA this year is driving many imaging centers to close or consolidate into groups. The practices that remain will need to increase examination volumes and streamline their operations to stay profitable.
Chris Schutz, a senior analyst at MRG, observed that with exam volumes and image sizes growing rapidly, PACS has become an essential tool for imaging facilities of all sizes and specialties.

The challenge for PACS vendors will be to offer systems that smaller facilities can afford. Schutz said that as vendors shift their focus from large facilities to smaller customers, they are developing PACS product offerings with attractive pricing and service models, which will help drive adoption in imaging centers and smaller hospitals.