By Bud DeGraff

Hospital budgets are decreasing annually, while at the same time, expectations of staff and service are increasing. With biomedical and clinical engineering shops being responsible for some of the most expensive and life-critical equipment in the hospital, it is vital for biomed department managers to find ways to control their own costs while still servicing and maintaining equipment at a high level. The five tips presented here can help hospital executives and biomed managers learn how to stay on top of cost management without cutting corners and sacrificing service.

1. Examine service contracts and right-size coverage levels. First and foremost, it is important to understand the state of an organization’s service contracts. Looking closely at a service contract can help uncover significant opportunities for savings—you may be paying for more than you need to. For example, a hospital may have a CT scanner reserved for biopsy procedures. If the hospital is paying for around-the-clock service coverage on the biopsy unit, even though the unit is only used for a limited time during the day, coverage could be reduced and money saved.

A hospital’s biomedical department can be an invaluable resource in assessing contracts, as engineers are on the front lines and in touch with vendors and original equipment manufacturers every day. They can help assess the kind of coverage needed and advise on switching to a shared-services model, where the in-house clinical engineering department assumes more responsibilities for equipment service but has flexible, customized coverage, training, and remote support from a vendor. Many organizations operate with great success under this model, and it can be a financially friendly option when reassessing service coverage.

It is true that, by removing coverage from machines, hospitals start to assume more risk—once coverage is removed, hospitals do run the risk of having a large invoice for time and materials if the equipment suffers a significant failure. In addition, response time may be delayed by the service provider if the equipment is not covered under a contract. But the math holds out. In noncritical areas of the hospital, even a one-time, big-ticket expense for an unexpected problem is likely to be far less than the cost of 24/7 coverage on a lightly used unit for a year. Finding opportunities for savings and ensuring appropriate coverage is a delicate balance.

2. Track down and redeploy inventory to improve productivity. It’s important for hospitals to know what and where their inventory is at any given time. Real-time knowledge on equipment location can help health systems to leverage resources throughout their system to ensure that hospitals have the right equipment in cost-effective ways that support clinical excellence. As biomedical departments know all too well, finding a specific piece of equipment can result in a frustrating search processes.

Redeploying an asset is almost always less expensive than buying a new one. For example, if a small hospital is in need of a new MR system—a significant investment—rather than purchasing a new one, hospital managers can look and see if a larger institution in their health system has an underutilized MR system. Could they, by increasing the efficient use of other MR systems in that facility, do without that specific unit? If so, the larger hospital’s MR system could be transferred to the smaller hospital at a fraction of the cost of an entirely new unit.

Also, for the larger, more expensive equipment necessary to provide top-notch care to patients, the tools needed to service and calibrate such equipment become increasingly expensive. In situations like these, hospitals may have the option to partner with their OEM to share resources and tools, ensuring that all equipment will be serviced with the necessary tools while saving money on the full ownership of such tools. Some examples of shared equipment include calibration tools, signal generators, signal and spectrum analyzers, and many others. These technologies and tools can often be too expensive for a hospital to own on their own. Thus, it’s vital to look for ways an OEM can help share in the responsibility of owning these products.

3. Pay attention to asset life cycle and total cost of ownership. When it comes to getting the most out of your investment in a piece of equipment, preventative maintenance and paying attention to an asset’s life cycle is key. Always being on top of the functionality of a device can save a lot of money in the long run.

It’s important to always look at the whole life cycle of a product prior to making a short-term decision. For example, an IV pump is broken and needs a relatively costly repair—the biomed manager should work with a hospital leader to discuss whether or not it’s worth it to repair the device. If the piece was purchased not too long ago and, after being repaired, would last a few more years, then it is worth considering making the investment to fix the device rather than purchase a new one, resulting in long-term savings but short-term expenditures.

Servicing a machine regularly and routinely will help ease up on unforeseen costs when a device does act up or come to the end of its life cycle. Doing so will aid in the preventative maintenance of such devices and lead to cost savings over time. For example, if a hospital has an ultrasound machine that’s a couple of years old, biomeds should routinely run tests and service the device to ensure that it is always in top condition and functioning as it should. This will allow for biomeds to be more aware of the state of the device so that the hospital can plan financially for any large fixes that could come down the pipeline.

4. Use technology as an enabler to save money, not cost money. Hospitals and biomed shops today are just beginning to use mobile devices, tablets, and RFID technologies as a means to control costs through better communication, access to information and documentation, and asset location. While this investment can seem steep at the onset, it may pay off over time, allowing clinical engineers to be more mobile and accessible with more immediate knowledge of equipment locations. A tablet costing $500 total brings an immediate ROI in its first quarter of operation if it can save an engineer 30 to 60 minutes a week. Quicker access to information and increased efficiency lends itself to cost savings and profitability. When each biomed is able to optimize their time spent on a machine and maximize their resources, the ability to control downtime and, ultimately, cost, is increased.

A great example of technology at work in a biomed shop or hospital is the use of tablets. With new tablets coming to market frequently, each with a new set of bells and whistles, the opportunities for utilization are endless. For example, say that you are a biomed working on an MR or other high-end piece of equipment. If you were to run into an issue that you weren’t able to easily solve on your own, you could take out your tablet and use a video chatting application to connect with your OEM for support. This way you receive instant support and answers to your questions, but you also can better visualize the problem and come up with a solution in partnership with the OEM.

In addition to face-to-face problem solving, tablets can also be used to provide biomeds with instant, real-time access to service manuals, databases, and other helpful online or computer-based tools. Quick access to necessary information increases efficiency, in turn cutting down on costs.

Every hospital faces the issue of misplaced assets. Using RFID technologies to tag mobile assets, such as IV pumps, can immensely decrease the amount of time spent trying to locate a device. A healthcare provider or technician can simply pull up information on an asset and go directly to that location, cutting out unnecessary time spent searching the hospital for that device. In addition to easy location of a device, RFID tags are also beneficial because they help hospitals better understand their inventory of devices, stopping them from buying excessive equipment.

5. Set appropriate, attainable benchmarks for continuous improvement. As with any sort of budget and performance tracking, hospitals and biomed managers must set benchmarks and baselines to make sure that they are staying within certain parameters and meeting certain expectations. Not only is benchmarking important for internal purposes and revenue assessment, it is also important to make sure that hospitals are benchmarking themselves against other hospitals in the area to make sure they are on top of their game and maximizing cost savings.

In the biomed setting, biomed managers need to set key performance indicators (KPIs) of what success looks like for their department. An example of a good KPI would be ordering the correct parts needed to repair a machine without having to establish an additional order for missed needs. After this KPI is established, the biomed shop can then use analytics to make sure they’re on top of their benchmarks to allow for continuous improvement. There are always ways for hospitals and biomed shops to improve their processes, and setting KPIs and benchmarks is a surefire way to go above and beyond.

Bringing it All Together

While it’s often difficult for hospitals and biomed shops to make sure they’re saving every cent possible, following these tips will help ensure that costs are kept down while quality of service goes up. Many of these best practices do require investments up front, in the form of both time and money, but they will pay off in the long run through increased efficiency and better equipment management. Biomed managers must work with their staff, as well as the hospital executives, to execute the measures above to help contain their costs while on stringent budgets. 24×7

Bud DeGraff is general manager, diagnostic and clinical services, GE Healthcare, Waukesha, Wis. For more information, contact [email protected].