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In 2024, we must demand transparency and accountability in surgical instrument repair

January 09, 2024
Business Affairs
Kevin Liszewski
By Kevin Liszewski

The need to focus on costs in healthcare has never been as pronounced as it is going into 2024. Hospital closures are up, technology costs are increasing, Medicare reimbursement updates have stalled, and patient care quality is at risk, for underserved populations as well as for American patients in general.

By reducing the cost impact of medical technology in U.S. hospitals, we can begin to ease these pressures simultaneously.

The U.S. is a leading country in the development of new pharmaceuticals and new technologies to improve the care we can provide to patients in need. As we get more and more sophisticated in our treatment approaches, we become more and more successful in saving lives.

However, we tend to forget that the cost of medical technology has an impact beyond the patient that we successfully treat with a groundbreaking innovation. When new technology is introduced, hospital costs go up, and the hospital’s ability to care for its patient base is diminished.

We may save the individual patient, but by doing so, we may also have limited access to care for others. Hospital economics should not be about simply leveraging the newest medical technology; it should be about providing the best possible access to care for as many as possible.

The role of medical instrument ownership
The cost of medical instrument ownership is a critical factor in the hospital’s ability to provide care for its patients. That’s not just because sophisticated instruments are required to do critical procedures, but also because the cost of medical instrument ownership has an impact on the hospital’s ability to provide proper care in general.

Most hospitals spend millions of dollars every year on reusable medical instruments. Cystoscopes, bronchoscopes, and arthroscopes are endoscopic instruments that can cost $50,000 or more. In fact, U.S. hospitals in total spent almost $12 billion on endoscopes in 2023, and this is expected to increase to almost $16 billion by 2028. These instruments are very expensive, very advanced, and should be treated like critical assets when they need service or repair.

However, endoscope ownership typically is not associated with asset stewardship. Instead, scopes are treated as disposable instruments, and the cost of ownership is hidden in capital accounts, capitated repair agreements, and over-priced service contracts. As a result, U.S. healthcare is unnecessarily spending millions of dollars on scopes—dollars that could be better spent opening up new service lines, investing in medical equipment, or hiring nurses for improved patient care. Lack of transparency into the cost of owning, for example, an endoscope is a massive cost driver for healthcare providers.

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