It has been 2 years since we received the “holiday gift” known as S&C 14-07-Hospital from the Centers for Medicare and Medicaid Services (CMS) with revised requirements for the maintenance of medical equipment.1 Much of the confusion and uncertainty has since been clarified by the accreditation organizations, but some seems to linger. One area of ongoing debate is the use of risk to classify and include equipment in the equipment maintenance/management inventory, popularly known as the “risk-based criteria” (even though its originator, my dear friend and former colleague Larry Fennigkoh, PhD, never meant it to be focused solely on risk2).
Prior to the adoption of the Fennigkoh and Smith model for equipment classification3 in the 1990s, The Joint Commission (TJC) required all AC-powered equipment to be inspected for electrical safety semiannually. The “risk-based criteria” allowed hospitals to establish “criteria for identifying, evaluating, and taking inventory of medical equipment to be included in the management program before the equipment [was] used.” The criteria recommended by TJC were: 1) equipment function; 2) physical risks associated with use; 3) maintenance requirements; and 4) equipment incident history.4 These criteria were typically summarized using the following equation, in which EM represents the “equipment management” number:
EM = function + physical risks + maintenance requirements (1)
In other words, until 2013 TJC allowed hospitals to include only those pieces of medical equipment that their clinical engineering (CE) departments believed should be maintained, tested, and inspected on a regular basis with scheduled maintenance. Accordingly, most CE departments excluded from their inventories basic medical devices such as endoscopes (rigid and, often, flexible ones), patient scales, oto-ophthalmo-laryngoscopes, thermometers, suction regulators, surgical instruments, etc.
The S&C 14-07-Hospital document issued by CMS in December 2013 was, however, very explicit that “[a]ll hospital facility and medical equipment, regardless of whether it is leased or owned, and regardless of whether it is maintained according to manufacturer recommendations or is in an [alternate equipment maintenance] program, is expected to be listed in an inventory which includes a record of maintenance activities.” This requirement has been codified by the accreditation organizations in their standards. For example, in EC.02.04.01 EP2, TJC states “[f]or hospitals that use Joint Commission accreditation for deemed status purposes: The hospital maintains a written inventory of all medical equipment.”5 Therefore, it is no longer permitted to exclude from the CE inventory equipment that has low EM value or for which scheduled maintenance is not planned.
One could argue that many of the medical devices traditionally excluded from the CE inventory were not exactly equipment, such as surgical instruments. Unfortunately, CMS (as well as the ANSI/AAMI standard EQ89:20156) defines medical equipment as “devices intended to be used for diagnostic, therapeutic, or monitoring care provided to a patient by the hospital (eg, IV infusion equipment, ventilators, laboratory equipment, surgical devices, etc).” Since surgical instruments (as well as surgical supplies) are included in the definition of “surgical devices” in the Code of Federal Regulations administered by the Food and Drug Administration,7 there is no easy way to exclude them (and other basic medical equipment that does not require scheduled maintenance) from CE inventory.
It is possible that the term “devices” was inadvertently used by CMS instead of “equipment,” since the rest of the S&C 14-07-Hospital document was clearly focused on “equipment.” The more generic term “devices” typically includes disposable supplies, implants, and equipment. Most dictionaries define equipment as durable goods other than land and buildings acquired by a business that exceed the enterprise’s minimum capitalization limit. This limit distinguishes low-cost items that can be included in operating expenses from higher-value fixed assets that must be depreciated over several years.
Therefore, a way to reduce the inventory burden is to adopt the following definition for medical equipment that is consistent with the spirit, if not the letter, of S&C 14-07-Hospital: Medical equipment is defined as a medical device regulated by the FDA that is: 1) durable and reusable for multiple patients; 2) serialized (ie, assigned a serial number) by its manufacturer; and 3) has a unit acquisition cost above $1,000.
Obviously, the capitalization limit of $1,000 is only a suggestion that should be adjusted to be consistent with each institution’s financial practices. Another alternative would be to group those low-cost, low-risk devices together instead of identifying each one individually, and just keep a count of the total number of devices per group. However, it will still be rather challenging to keep the inventory accurate over time due to the large number of devices and their inevitable turnover.
Perhaps the misconception about the usefulness of the risk-based criteria stems from the S&C 14-07-Hospital document itself. It states, “[a] hospital may adjust its maintenance, inspection, and testing frequency and activities for facility and medical equipment from what is recommended by the manufacturer, based on a risk-based assessment by qualified personnel…”
However, a careful reading of the rest of the S&C document shows that this statement only applies after the inventory (with all the equipment included) is established. Then, the CE department may use the risk-based criteria to determine which pieces of equipment within the inventory it will choose to deviate from the manufacturer’s maintenance recommendations and move into the alternate equipment management (AEM) program. Obviously, this process cannot be applied to imaging/radiologic equipment, lasers, and new equipment for which the CE team does not have sufficient amount of maintenance history. This interpretation has been corroborated by TJC Director of Engineering George Mills.8
In essence, make sure that your inventory is no longer limited to equipment considered “risky” and planned for scheduled maintenance. While you can still use risk-based criteria for AEM inclusion, remember that the S&C 14-07-Hospital document requires you to perform safety and effectiveness evaluation for each equipment category. You must prove that the AEM outcomes are comparable to those that would be obtained if you had followed manufacturers’ recommendations.
Binseng Wang, ScD, CCE, fAIMBE, fACCE, is vice president, Quality & Regulatory Affairs with Sundance Enterprises. The views expressed in this article are solely those of the author. For more information, contact chief editor Jenny Lower at firstname.lastname@example.org.
1. Centers for Medicare & Medicaid Services, Memorandum S&C 14-07-Hospital, issued on December 20, 2013, available at https://www.cms.gov/Medicare/Provider-Enrollment-and-Certification/SurveyCertificationGenInfo/Downloads/Survey-and-Cert-Letter-14-07.pdf. Accessed December 16, 2015.
2. Wang B. Fennigkoh and Smith Model for Inclusion Criteria: 15-Year Retrospective. Interview with Larry Fennigkoh. J Clin Eng, 2006;31:26-30.
3. Fennigkoh L & Smith B. Clinical equipment management. JCAHO PTSM Series. 1989;2:5-14.
4. JCAHO. Comprehensive Accreditation Manual for Hospitals. Oakbrook Terrace, Ill: Joint Commission on Accreditation of Healthcare Organizations; 1995.
5. The Joint Commission. 2015 Comprehensive Accreditation Manual for Hospitals (CAMH). Oakbrook Terrace, Ill: The Joint Commission, 2015.
6. ANSI/AAMI EQ89:2015, Guidance for the use of medical equipment maintenance strategies and procedures. Arlington, Va: Association for the Advancement of Medical Instrumentation; 2015.
7. US Food and Drug Administration. Code of Federal Regulations Title 21, revised as of April 1, 2015. Available at: https://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?CFRPart=878&showFR=1&subpartNode=21:18.104.22.168.26.5. Accessed on December 16, 2015.
8. Ask George. Biomed Instr & Techn. 2015;49(4):237.