How Smart Equipment Disposition Can Boost Your Bottom Line

By Cindy Juhas

When healthcare equipment outlives its usefulness or is ready to be replaced by newer, better products, many hospital administrators face a dilemma. Should they store the old equipment, throw it out or could there possibly be third option that isn’t as wasteful – or even a revenue source?  

Donations are always a practical move, as is selling the old equipment. Both save on precious warehouse space that can cost thousands of dollars to maintain, with donations providing tax write-offs for the hospital and sales opening new revenue streams. Typically, this transition of equipment falls to the biomedical or facilities teams, but in today’s budget-conscious environment, many of those teams do not have the necessary staff, which makes this process even more difficult. 

It’s a complex issue, but there are solutions. The first step is to assign a responsible person or department to oversee disposition. The next step is to formalize the disposition process across the healthcare system. This process should include the following: 

  • Decommissioning of equipment
  • Removal of any and all hazardous waste
  • Full cleaning of the device 
  • Removal of all proprietary and patient information

There are four “pathways” for decommissioned equipment to take: selling, donating, recycling or disposing. Each item must be assessed and set on the appropriate pathway, with each step being carefully documented – including a well-maintained inventory list. 

This can often be too much for one team to handle, which is why outsourced disposition companies have become a popular option for facility managers. Some national equipment distributors are using their expertise to offer solutions to this problem. 

The options offered typically include: 

Equipment Buy-Back: The facility will contact a healthcare equipment distributor or a company that specializes in equipment disposition. They evaluate the retired equipment, figure out how much the equipment is worth, and schedule a pick-up time. Typically, freight costs will not be charged for this service. 

Project-Based Equipment Swap: When a facility upgrading its equipment or expanding, the manufacturer or distributor that sold the equipment should be able to take the old equipment (for a nominal fee) at the same time they deliver the new items. If you think your old equipment has some value, call the same healthcare equipment distributor prior to them installing the new equipment and they will evaluate the old equipment. From there, they usually make a cash offer on any equipment that is viable for resale, dispose of or donate the rest, and schedule a time to make the swap. 

Full-Service Disposition Contract: Customized agreements with a healthcare equipment distributor or disposition company is a complete solution for all disposition needs that can include: customized periodical reports itemizing the disposition status and profit-sharing opportunities. The report, depending on the company, will let you know how each piece was handled and whether it was donated, recycled, disposed of properly, or if it was refurbished and sold, including all costs and profits.  

The best solutions for healthcare disposition involve a collaboration between supply chain leadership, facility department heads and a trusted third-party partner. With an outside company doing all the disposition leg work for the healthcare system, biomedical staff can focus on fixing and maintaining equipment that is still in use. This also saves them unnecessary warehousing costs while adding to the revenue stream. A healthcare system that has a buttoned-up disposition process will have an improved bottom line, as well as a more efficient and streamlined pathway to upgrade to the latest technologies.

Cindy Juhas is the Chief Strategy Officer of CME Corp. CME is a national distributor of healthcare equipment representing over 1,400 manufacturers and 1.2 million items. Along with providing the equipment, CME also offers unique services including logistics, warehousing, assembling, staging, delivery, installation, biomedical/technical and equipment disposition services for new facility and equipment replacement projects. Learn more at cmecorp.com.

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