News Briefs: Teleradiology firm files for bankruptcy

TeleQuest, a teleradiology company that contracted with some of the nation’s most prestigious medical schools, has filed for Chapter 7 bankruptcy protection. TeleQuest was formed in 1994 to establish a nationwide network of luminary sites that would provide subspecialty interpretation services to hospitals, imaging centers, and other healthcare providers. Its luminary sites included University of Pennsylvania, Brigham and Women’s Hospital, Emory University, and University of California, San Francisco.

But even such big names could not save the Philadelphia-based service provider. In 1997, several executives, including the CEO and president, left TeleQuest, and income from operations plunged from $354,000 in 1998 to $85,000 last year. Company assets were listed at $1.1 million and liabilities at $1.6 million. Among the firm’s largest creditors are the radiology practices at three of its consortium members: Radiology Associates University of Pennsylvania, owed $413,000; Brigham Radiology Foundation, owed $224,000; and UCSF, owed $230,000.

TeleQuest blames its problems on being locked into unfavorable equipment lease arrangements negotiated when telecommunications costs were much higher than today. Declining reimbursement rates also took their toll. In addition, TeleQuest depended on a single chain of imaging centers for about 90% of its income. When that chain suffered financially last year, it brought TeleQuest down with it.