Imaging Entrepreneur Sees Opportunity in Workers-Compensation Market
Ten years after selling AnciCare, a network of 1,200 imaging centers in 40 states, Michael Cabrera is again putting up his own money for a new venture. According to a feature in the Miami Herald, the Florida-based entrepreneur will this time focus on the Sunshine State’s workers-compensation market. Under the name of U.S. Radiology, Cabrera hopes to bring structure to a $1.2 billion workers-compensation realm where diagnostic-imaging referrals largely go unmanaged—leading to overpayments, inefficiencies and quality issues. In the Herald article by Nancy Dahlberg, Cabrera points out that “if an injured employee has to wait for an MRI or to get the results, the diagnosis or start of treatment can be delayed…And time is money to insurers, because sidelined workers receive indemnity payments while they work.” With a winning track record, and considerably more seed money this time around, Cabrera is well positioned to again do well. However, industry consultants such as Douglas G. Smith, FRBMA, are quick to point out that the workers-comp sector has demonstrated severely protracted payment to providers versus other third party payers.  “History, with a few exceptions, also demonstrates that workers-comp companies have traditionally shopped low price at the expense of enhanced service level,” says Smith, managing partner, Strategic Positioning & Consulting Services, Integrated Medical Partners, Milwaukee, Wis, “and thus tend to behave as if diagnostic imaging services are a commodity with little to no differentiation among providers of such services with respect to access, scheduling, turnaround time, quality of imaging, or quality of professional interpretations.” All that said, Smith adds that there are “wild exceptions” to the “commodity” view of radiology shared by many workers-compensation companies. “Mr. Cabrera may have, as part of his strategy, a ‘direct contracting with employers’ model in mind,” says Smith, “but the article does not, and probably should not, reveal such specifics of his plan…I just hope he is not overly relying upon the way this space worked when he was last in the space as a successful entrepreneur.” For his part, the 49-year-old Cabrera is confident he can again succeed by at first focusing on workers compensation, and providing “complete radiology management services through a network of free-standing diagnostic imaging centers.” Cabrera’s business plan, which took second place in Florida International University’s Business Plan Challenge, calls for building a network and launching U.S. Radiology in three months. “He’s starting the company with $250,000 of his own money, and will be looking for an investment partner down the road to fuel growth,” writes Dahlberg in the Herald. “He believes he can capture 2 percent of the market and generate $15 million in annual revenues in year No. 5.”