Radiology Partners Inc. has been growing like a medical practice on steroids.

Formed in late 2012 by Rich Whitney and Dr. Anthony Gabriel, both veterans of DaVita Healthcare Partners Inc., RadPartners acquired its first practice, a team of five physicians, in June 2013.

A little more than a year later, it has become one of the larger hospital-based groups in the country, boasting more than 180 physicians serving more than 90 hospitals, clinics and imaging centers in six states.

The expansion has been fed in large part by a $60 million investment from Menlo Park venture capital firm New Enterprise Associates.

The rapid growth comes as changes in the financial and health care landscapes encourage consolidation in medical fields as a way to capture market share and benefit from economies of scale.

“Private equity and venture capitalists really like the fact that businesses they’re investing in can effectively be plugged into bigger solutions and allow them to capture greater market share,” said Steven Shill, Costa Mesa-based health care practice leader for accounting and consulting firm BDO USA’s western region.

These investors seem to favor health care sectors with less variability in the regulatory environment and where returns are expected to be consistent. Also attractive, he said, are investments in companies that would “effectively bend the curve” or create such significant cost savings for health care providers that returns would be significant.

Shill, who said he has worked with both RadPartners and NEA, pointed to L.A.-based Leonard Green & Partners as an example. The private equity firm acquired Prospect Medical Holdings, a Westwood hospital owner and operator, in 2010 around the time the trend began.

Other health care fields that have drawn attention are behavioral health, another fragmented industry, and dentistry. On that latter front, Santa Monica’s Brighter Inc. received its third round of funding late last year., which could be considered more of a health care IT play, is a platform that helps consumers find affordable dental care in lieu of a dental insurance plan.

Scaling up

Whitney, who was chief financial officer at DaVita and now serves as RadPartners’ chairman and chief executive, had teamed up with NEA on a number of projects as a partner or adviser. Gabriel, RadPartners’ chief operating officer, had been chief information officer at DaVita, which had been based in El Segundo until its relocation to Denver in 2009. It acquired Torrance’s Healthcare Partners in a $4.4 billion deal in 2012.


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