In April 2006, Axis Imaging News surveyed readers concerning their purchasing plans and methods for capital equipment. By completing a 23-question survey form online at imagingeconomics.com, 88 respondents provided a snapshot of their equipment-related needs and expectations for imaging—and of the obstacles that some face in preparing for the future.
The largest group of respondents consisted of radiology administrators (37%), and many (19%) were physicians. Smaller groups—of CEOs, CFOs, CIOs, and COOs (14%); medical physicists (6%); picture archiving and communications system administrators (6%); technologists (4%); and practice administrators (2%)—also provided data. Other titles represented (14%) included chief of radiology, radiology information system manager, radiology services manager, director of clinical engineering, consultant, chief technologist, chief sonographer, and buyer.
Most respondents (61%) were working in hospitals, with an additional 27% working in freestanding imaging centers and 8% in health care systems. These facilities were located in the United States for 87% of respondents, with another 3% in Canada and 10% elsewhere. US respondents were distributed throughout the East North Central (20%), Pacific (17%), South Atlantic (15%), Middle Atlantic (9%), and New England (9%) regions, with smaller groups reporting from the West South Central (7%), Mountain (5%), East South Central (2%), and West North Central (2%) regions.
In addition to describing their purchasing challenges by choosing their answers from a list of predetermined probable responses, most of those surveyed also provided insightful free-text comments.
|Figures 1 & 2
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Naturally, procedural volumes (Figure 1), and the capital-equipment budgets that are often tied to them (Figure 2), varied widely. Half of the respondents worked at facilities performing 50,000 to 250,000 procedures per year, and the largest group (43%) reported capital-equipment budgets of $1 million to $5 million for radiology. Although 21% reported that their capital-equipment budgets had not changed since fiscal year 2005, 24% reported budget decreases. Of these, 14% are coping with decreases of less than 6%, but one third reported decreases of 7% to 10%. Cuts of more than 10% have been imposed on 52% of respondents who reported budget decreases.
In explaining these decreases, some respondents commented that they had recently completed major installations of new technology, so only smaller purchases would be required to keep their capabilities in state-of-the-art condition. However, more respondents said that declining reimbursement was the primary reason for their budget cuts (and, in some cases, planned expansions of service had been shelved for the same reason).
A more fortunate 45% of respondents reported increases in their capital-equipment budgets, which grew by more than 10% for half of that group. Increases of 7% to 10% were reported by another 14% of respondents; increases of 3%–6% were reported by 19% of respondents. Budget growth of less than 3% (in the absence of budget cuts) was not reported by any of those surveyed.
|Figures 3 & 4
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Capital equipment will be purchased in 2006–07 by 98% of those surveyed, with CT being the most frequently named modality to be purchased (Figure 3). Of the 50% who will purchase CT scanners, most (62%) plan to buy models with 64 detectors; 9%, 32 detectors; 19%, 16 detectors; 2%, 8 detectors; and 4%, fewer than 8 detectors. Most of the 44% who will acquire MRI systems intend to buy magnets having field strengths of 3 Tesla (23%), 1.5T (60%), or 1T (2%). Only 2% expect to purchase magnets of less than 1T. Open magnets will be bought by 6% of purchasers.
Respondents from freestanding facilities were asked to comment on whether they are likely to change their purchasing plans because of losses that they anticipate as an effect of the Deficit Reduction Act of 2005 (DRA). Although many said that the DRA will cause them to make drastic cuts (including deferring all purchases), others intend to pursue their original plans but buy refurbished equipment or less advanced technology instead. One respondent, for example, will buy a 16-slice CT scanner instead of the 64-slice system originally planned. About half of respondents from freestanding imaging centers who commented on this issue, however, did not expect to change their purchasing plans in any way in response to the DRA.
Three fourths of respondents reported that their facilities held memberships in buying groups, and of these, 25% said that 75% to 100% of their purchases were made through their buying groups. For 23%, 50% to 75% of purchases were made through the group, and for 15%, 25% to 50% of purchases were made that way. An additional 15% indicated that fewer than 25% of purchases were made using the buying group.
A preferred vendor for purchases of imaging modalities was specified by the facilities of 38% of respondents, but only 8% indicated that the same vendor was designated for all modalities. In many cases (55%), respondents reported that the radiology administrator participated in the selection of the designated vendor; other respondents noted that the radiology chair (45%), hospital CFO (31%), operations/materials manager (26%), chief technologist (26%), medical physicist (13%), or CIO or representative of the information-technology department (13%) participated in selection of the designated vendor.
Contracts with the preferred vendor were 1 to 2 years long for 27% of the respondents whose facilities had such arrangements in place, 2 to 4 years long for 20%, 5 years long for 14%, and more than 5 years long for 7%. For all contract lengths, 60% of respondents stated that it was possible to override the vendor designation in some cases. Several commented that this process involved a formal effort to obtain the approval of senior management, but others needed only the consent of a majority of the members of the facility’s technology-acquisition team. In some cases, simply receiving a better offer from a competing vendor was enough to permit an override.
|Figures 5 & 6
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The chair of radiology and the radiology administrator were equally likely to be involved in the technology-acquisition process, with each being cited by 73% of respondents. The subspecialty radiologists were named by 47%; the practice president, by 16%; and senior management (CEOs, CFOs, CIOs, and COOs), by 5%. Beginning with the issuance of a formal request for proposal and ending with a purchase, the technology-acquisition cycle took less than 6 months at the facilities of 29% of respondents, 6 months to 1 year for 47% of respondents, 1 to 2 years for 11%, and more than 2 years for 5%.
Respondents working in hospitals and health care systems indicated that, in acquiring equipment, they faced the greatest competition for imaging-technology dollars from cardiology departments (79%), oncology departments (27%), and vascular-surgery departments (32%). Information-technology, emergency, and other departments without a primary focus on imaging were perceived as the greatest funding competitors by 14% of respondents.
Axis Imaging News thanks all those who responded to the survey for their time, as well as for their generosity in sharing their insight into these complex issues.
Kris Kyes is the technical editor of Axis Imaging News.