From the November 2020 issue of HealthCare Business News magazine
By Tom Watson
The foundational parameters of service agreements for imaging technology have not changed dramatically in the past 12–24 months.
The trends over the past three to five years have shown vendors enhancing their service offerings to be much more tailored to specific needs of the client. Prior to this there were basic, routine and extended level agreements with little to no customization.
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Now, service offerings generally consist of four to six different levels of support with optional coverages that can be included or excluded to tailor the coverage to the client’s needs. Below are a few of the many optional coverages that may be selected:
• Custom hours of coverage
• Preventive Maintenance scheduled to work around normal utilization scheduling
• Real-time, online monitoring to identify problems emerging, but before outright failure occurs
• Virus protection
• Coverage of special options and accessories
• Additional training both online and on-site
• Damage or accidental coverage for components that previously were covered only for normal failure
Driven in part by mergers and acquisitions, we are seeing an increase in strategic consolidation of multiple imaging contracts, particularly with the same vendor, into a master service agreement. This provides the advantage of leveraging enterprise-wide visualization of the total operational expense for medical technology support. Further, it allows coordination of co-terminus contract management with a single point of focus.
Historically, service contract consideration and decisions were disparate and siloed, with little or no coordination to ensure oversight and management with a strategic focus. The result has been in-the-moment decisions with very little long-term or enterprise-wide implications.
Imaging is a key area of focus for several reasons. Much of the technology is based on radiation-emitting, highly complex solutions that require specialized training, software diagnostics and, in most cases, service from either the OEM vendor or a well-qualified third-party service support company. Some are moving to a more risk-based approach with in-house support or excluding high-cost support items such as X-ray tubes and/or detectors. Often consolidation allows for pooling of high-dollar items that provide a specific number of replacements annually without having to pay full price for high-priced items for every covered system.
Most healthcare organizations use OEM service or very highly qualified third-party support for CT scanner maintenance. It is very rare for organizations to go at risk (without service agreement), and full-service plans are the most commonly considered. The annual price range for service support is $56,000 to $195,000, with an average of about $125,000 across all vendors and models. Items that greatly impact pricing include X-ray tubes, detectors, principal coverage period (PCP) hours, and uninterrupted power supply (UPS) units.