by Sean Ruck
, Contributing Editor | November 04, 2014
From the August 2014 issue of HealthCare Business News magazine
Masterman says hospitals need to really consider what their needs are in order to get the best deals when it comes to negotiating contracts. This also means the hospitals need to determine just how catastrophic having a particular machine offline would be and then determining the intelligent spend to insure against that problem.
With the budget crunch affecting hospitals big and small, insurance like that will grow in importance as the health care sector’s fleet of machines ages. “There will be a larger parts business,” says Anwar Abdelqader, sales manager at CBE Medical Inc. “The economy is bad, so companies will replace parts instead of buying new devices,” he says.
But when it does come time to buy, Abdelqader has a straightforward solution. “I gave my customer a comparison between two models , and let him know where to buy from,” he says.
While there are gray areas when one considers that some parts and service providers also sell refurbished machines as part of their business, many bring in their main income by keeping existing equipment up and profitable. In that way, they’re markedly different from the OEMs according to Pete McCann, vice president of sales for Modern Medical Systems. “From the OEM perspective, there tends to be a focus on their products rather than an overall view of the entire service strategy,” he says.
As for what ISOs can deliver to facilities with in-house service, McCann says they can be good for providing services for high-end, advanced equipment. If the facility doesn’t have an abundance of the machines, it may make it financially impractical to train inhouse engineers to fix them. According to McCann, it is typically smaller health systems or even larger ones with remote sites that can benefit from ISOs.
McCann says since Modern Medical is strictly a service company, they have managed to perfect a labor model where they “right-size” the amount of labor needed rather than saying every item has a price. “We look at the entire spend of the system and develop and overall strategy for them.”
One unique component of Modern Medical’s business is their training. While many service organizations, both on the ISO and OEM sides offer technical training, Modern Medical also offers soft-skill training. “We teach management how to communicate with directors of other departments,” McCann explains. “It’s almost as important as being able to fix the item. They need to be able to communicate the issues clearly within their system and even at times with regulatory organizations,” he says.