CXOFiles No.6 Alliance Imaging’s Paul S. Viviano: Master of Diversification

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When Paul S. Viviano, joined Alliance Imaging in January of 2003, the company was almost exclusively a mobile MRI vendor. Since then, the company’s chairman of the board and CEO has overseen an aggressive diversification strategy, moving the hospital-centric company into fixed-site MRI hospital partnerships, PET/CT, and most recently radiation oncology.

Viviano has a 25-year history in health care administration. Prior to accepting the position with Alliance, Viviano served as president and CEO of USC University Hospital and USC/Norris Comprehensive Cancer Center, Los Angeles, and before that spent 13 years in various positions with the St Joseph Health System after serving as CEO of Long Beach Community Hospital. He holds a Master in Health Administration from UCLA. Viviano recently shared his thoughts on the leadership with ImagingBiz.com.

ImagingBiz.com: Going into 2008, what are the transformative leadership issues for imaging company executives? What do these times demand of leaders?

Viviano: It’s a challenging time. As we look to ‘08, we see continued challenges for the industry. A number of forces are going to continue next year: pressure on reimbursement, utilization management pressure on advanced diagnostic procedures, and an excess supply of providers in many markets. All of those translate into a lot of pressure on all of us who provide imaging services to patients. So I think these times demand clear strategy, a devotion to high quality patient care, to serving the needs of patients from a service standpoint. All of those are going to be essential to maneuver through this very difficult time that lies ahead of us.

ImagingBiz.com: Is there anything particular that you think will be important in your arsenal of management strategies and skills?
Viviano: For me specifically, it is a time of great discipline. There are a lot of different strategies available, there are companies for sale, there are temptations to diversify more broadly, there are all kinds of answers, or potential answers, to the difficult challenge that we face. So it is a time to be very disciplined about investing capital wisely, about making sure your clinical infrastructure stays intact, and that you are meeting the needs of your customers and your patients specifically. It’s easy to get caught up in some of the wrong things that might lead you down an undisciciplined path that could be problematic.

ImagingBiz.com: How do you see leadership being different in 2008 and beyond, not only for Alliance, but other imaging companies?
Viviano: This is an era when the industry is going to contract. There are going to be fewer providers next year than there are now. That means your operating expertise needs to be honed, focused on , again, investing capital wisely, making sure you are generating the kind of volumes, generating the right staffing mix, all of those operational focuses need to be intact, along with the demand to have a strategic plan that makes sense.

ImagingBiz.com: Alliance has made a significant move into the radiation oncology market. Is the convergence of radiation oncology and radiology a part of the new terrain for imaging center operators?
Viviano: I think, to some degree, that there is definitely a clinical linkage between PET/CT and radiation oncology in the early diagnosis of cancer that PET/CT provides for. And then, of course, the planning efforts that go into radiation treatment planning overlap, and there is no doubt that the clinical future of radiation therapy is IGRT, image guided radiation therapy. Just by its very definition, providing real-time images to make sure that in turn the radiation is applied appropriately—right dose, right time, right location—is all going to be driven by images.

So there is a clinical linkage between them that is definitely more PET/CT oriented and simulation CT oriented than it is MRI oriented. I do see a convergence to some degree. We are building radiation therapy centers and all of them will have PET/CT in them. So that’s a bit unique perhaps. We have three currently and a number of them are under construction. We haven’t given guidance yet for ‘08 on how many we will open, but a handful are currently under construction. It is going to become a meaningful part of our business by 2009.

ImagingBiz.com: What are the key challenges for leaders of organizations of significant size, such as yours?
Viviano: For anybody that is involved in the debt markets today, which