IBISWorld Market Research
Rising use of highly detailed CT scans has defied the trend away from procedures that expose patients to radiation
Melbourne, Australia (PRWEB) December 02, 2014
Diagnostic Imaging Services provide healthcare practitioners with crucial information about patients' illnesses, injuries or diseases. Services such as X-rays, ultrasounds and magnetic resonance imaging (MRI) are integral to healthcare delivery. Demand for these services is far stronger among older people, and consistently increases as people age. According to IBISWorld industry analyst David Whytcross, “with Australia's population ageing quickly, industry demand has surged over the past five years.” Demand growth has been coupled with increased industry competition. Price competition has been driving greater bulk-billing levels and increasing service volumes as diagnostic imaging is made affordable to all. Industry revenue is forecast to rise by a compound annual rate of 5.3% over the five years through 2014-15, to reach $3.3 billion. Revenue is expected to increase by 5.8% in 2014-15.
The industry is underpinned by Medicare benefits. Medicare benefits accounted for 88.8% of industry revenue in 2013-14, and this ratio is increasing year on year. Medicare funding for more expensive procedures such as MRI, nuclear medicine and computerised tomography (CT) has enabled industry growth. The use of CT has increased over the past five years, as it is in high demand from older age demographics and transmits highly detailed images. As such, it has defied the trend away from procedures that expose patients to radiation. “This trend has resulted in an increasing ratio of ultrasounds and MRIs being performed, in contrast to nuclear medicine and diagnostic radiology such as general X-rays,” says Whytcross. The general trends driving industry growth are expected to remain relatively unchanged over the next five years, but potential budgetary changes could subdue revenue growth. Industry demand is projected to continue growing as Australia's population ages. The use of procedures that provide the most accurate and detailed images without using radiation will spur further growth in MRI. In addition, Medicare funding is expected to increase in absolute terms. However, proposed changes in the 2014-15 Federal Budget that would reduce schedule fees and introduce bulk-billing co-payments for diagnostic imaging, and general practitioner consultations could reduce demand and subsequently industry revenue.
The Diagnostic Imaging Services industry exhibits a moderate level of market share concentration. The industry is made up of large operators, such as I-MED Australia, Sonic Healthcare and Primary Health Care; larger state-based operators, such as Capitol Health; and independent operators. Concentration has increased over the past 10 years due to consolidation in the industry, with all major players expanding their operations through acquisitions. Despite the substantial concentration of ownership, the industry has a fragmented structure beyond the larger players, including a high number of sole proprietorships and establishments with fewer than 20 employees.
For more information, visit IBISWorld’s Diagnostic Imaging Services industry in Australia report page.
The industry includes establishments engaged in providing diagnostic imaging services. The industry does not include diagnostic imaging services that are performed by general hospitals.
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