Special report: Choosing service contracts

by Loren Bonner, DOTmed News Online Editor | August 17, 2012

From the August 2012 issue of HealthCare Business News magazine

Facilities should be wary of parties offering very long term contracts (more than five years). In the non-OEM arena, if you research your vendor to ensure that they have a track record of performance, you will likely save between 20-40% vs. the OEM, and be very satisfied with your service.

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Larry Hertzler, vice president, operations support and Francis Vonder Haar, vice president of diagnostic Imaging ARAMARK Healthcare Technologies

Always get a proposal from a non-OEM provider.

Investigate a provider’s true ability to deliver what they sell; you can do this by requesting a reference list and through online research of press articles, case studies, and testimonials.

Be sure the service contract offerings are apples-to apples. So many times there is a reason for a “low ball” price that surprises the customer later.

Consider what coverage is really needed. Classic vanilla coverage is fine, but there are other flavors out there.

Watch the fine print as it can significantly impact the total cost in the end.

Make sure you consider how future changes might impact your decision, e.g. will the contract lock you into something you may need now, but not later, that you will pay for the entire time.

Michael Guin, senior vice president, service, Siemens Healthcare

Michael Guin, senior vice president,
service, Siemens Healthcare

When your facility is considering a contract for imaging service support, weigh the revenue side of the equation, and not just the cost of the support. What happens to your revenue when your imaging equipment is down for hours – or even days? Eventually, any advanced technology will require service. And if you’re signing up for a service plan that doesn’t guarantee uptime, response time or timely parts delivery, you risk losing thousands of dollars. For example, by using CMS reimbursement averages, we estimate that taking a single CT system offline for three days could cost a facility $90,000 in lost revenue alone.

Consider the systems expertise of a service provider, keeping in mind the considerable edge an OEM service provider has in this area. Ask how much experience the provider’s service engineers have on average – and many hours of training they receive per year. If it’s substantially less than 100 hours, consider looking elsewhere. Also, what sort of advanced certification do these engineers receive – if any?



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