Last month, HCB News spoke with Wesley Reid, CBET/CHTM, a healthcare technology manager and an enlisted member of the U.S. army about the work he did to reduce costs and improve efficiency during his time at Tripler Army Medical Center.

During the conversation, the topic of checklists came up. As a follow-up to August’s article, Reid provided details about his checklist when it comes to service contracts. Read on to learn more.

Contract Review

• Perform or review a BCA

Before signing, Reid recommends performing a benefits/cost analysis (BCA) on any new service contract being considered. Existing contracts should have the BCA reviewed, especially if there’s a renewal coming up. He suggests determining which level of service will have the best return on investment with a range of possibilities being: full service, first look, parts only or time and materials.

When looking at the BCA, it’s useful to look at the expertise of the outside service provider versus any in-house technicians, and to weigh the cost of training for in-house techs versus paying for the outside service provider’s experience. Even among outside providers, it’s important to consider experience when determining costs – you may pay more per hour for high-level expertise, but if you’re considering a time and materials contract, the expert may come out cheaper by being able to diagnose and address problems faster.


• Compare repairs

Reid suggests you analyze items routinely sent out for repair as a potential new contract target to reduce average maintenance costs. “For example, if you have 300 Rigid Scopes that average $1,100 a year each in repair costs and you request a quote for full contract coverage that comes in at $900 for each scope, you have a cost savings of $60,000 a year. On top of that, you may be reducing the administrative actions required for each individual service request as opposed to the single contract,” he said.

Reducing administration actions also leads to reduced repair times. Additionally, the contract can be a solid budget line item with predictable costs for the year.


• After-hour service versus patient rescheduling

Equipment isn’t considerate when it comes to breakdowns. Just because your service contract hours have a window doesn’t mean your machine is going to fail within that time frame. If a repair is needed after contract hours, it can be pricey. Reid advises speaking with the downed department to determine how many procedures will need to be cancelled and rescheduled and what the cost of the disruption will be. Obviously, if nothing is scheduled, wait until contract hours to have the repair made. If the revenue loss is much higher than the after-hour service costs, make the call. If the cost of repair is more, but there are a number of procedures scheduled, or patient satisfaction would take a hit, or a logistical nightmare would occur, weigh all the facts and make your decision.

Review In-House Training


• Technicians

Keeping your techs current on their training and improving skills will reduce the need for one-time service requests from manufacturers and reduces equipment downtime for maintenance that can be done in-house, as well-trained techs can diagnose problems and address them faster. “Training focused on your high-risk/high-complexity of use devices yields the most efficiency and safety returns,” Reid said.


• Management

Reid believes advanced training for the decision-makers at an organization should be on the radar. Lean Six Sigma, Certified Healthcare Technology Manager and Project Management Professional certifications are all value-added. The training and knowledge gained will support and enable high reliability and fiscal conservancy throughout the HTM department, he said.


• Users

It’s actually the users, not the techs that are the first line of defense against equipment failure. To begin with, users with inadequate training can actually be the cause of the equipment failure. Once the bar is cleared for proper use, training to identify basic warning signs of imminent failure or functional degradation can allow techs to get an early heads-up before a minor problem becomes a major one. Yearly refresher training on complex equipment is worth considering too.

Capital Equipment


• Procurement

Procurement is definitely an area where time is money, but the time/money equation has the real potential to work out in your favor. “I have found that it is beneficial to have a project manager review the potential procurement so that they can spot any deficiencies and have them corrected before the contract is let and they are stuck with a troublesome project,” Reid said. “For example if a steam sterilizer is being purchased for a dental clinic, a question to ask is, 'does the clinic have a central steam supply or is the boiler option needed as part of the procurement?'”


• Intended use versus intended purchase

Carefully consider whether you’re buying too much or too little when it comes to your device. According to Reid, he found that many companies include packages that aren’t necessary for the needs of the organization.

One final takeaway Reid offered, “Not all contracts are bad, some save time and money and improve availability of equipment.”