At the same time, newer, lighter equipment is always being introduced by the big three OEMs. Yesterday's 50 pound light source box is replaced with today's five-pound portable unit. These upgrades leave hospitals wondering what to do with older, but still viable endoscopes and accessories. The OEMs tend to abandon support for older equipment, but third party independent service organizations (ISOs) pick up the slack and specialize in finding new parts and refurbishing and repairing endoscope equipment, which understandably suffers wear, tear, and leaks in the sterilization process. (Some independents are even certified by the OEMs.) A common service need for endoscopes is replacement of compromised layers of the scope such as the sheathing. Some servicers can completely rebuild the equipment, including replacing fiber optic rods, which are notoriously delicate. Still other servicing requirements might include cleaning, polishing or replacing lenses, light guide tubes, the biopsy or suction channel, or computer chips. The light source may also need attention including transmission, cooling and electrical issues.

OEMs and the ISOs have long been in contention and competition. OEMs are stingy with information about how to repair equipment, despite an FDA regulation that supports openness. OEMs may also withhold parts from the market. Perhaps most important, the ISOs complain, OEMs attempt to lock health care providers into long-term service contracts. Nevertheless, there's plenty of business to go around for OEMs and for ISOs due to the constant need for scope repair, fed by an aging population's demand for medical services requiring endoscopes. (Is there anyone out there who doesn't need a colonoscopy?)


The Bottom Line
The greatest influence guiding choices in the U.S. healthcare system today is the pressure to control costs. Here lies the ISO advantage.

"One of the big reasons hospitals should consider [ISOs] is excellent value," said Jackson. "We can sell refurbished scopes in most cases for half of what the manufacturers sell them for. And if you put them next to each other you couldn't tell the difference." He estimated that refurbished scopes from the OEMs are priced at just 20 percent below list price for new equipment.

Like many ISO pros, Jackson spent a good part of his career working for one of the manufacturers. His company has access to original or identical parts to repair all types of scopes. "We bring these scopes to the point where they will meet manufacturers' specifications or exceed in some cases."

Endoscopy Homepage