When it comes to purchasing used medical imaging equipment, a new twist on an old adage could not be more appropriate Buyer Be Aware.
Two of the big questions in purchasing new, pre-owned or refurbished equipment are: What should buyers look for? And, why buy in the first place?
To answer the latter question, buyers should try to determine what is the best equipment to get the job done, not necessarily the most advanced system or which unit has the most features.
In some instances, pre-owned equipment may be more appropriate for a facilitys needs, while, in other cases, an institutions available funds will not allow for the purchase of new equipment. In addition, there may be situations where an organization wants to test the economic feasibility of a new program a satellite imaging center, for example before making a major investment in new equipment.
At savings of up to 50 percent off the price of new technology, there is plenty of financial incentive to choose pre-owned or refurbished systems for the right application.
You can get a piece of equipment thats maybe five years old and one generation behind the current one that is just perfect for use as back-up equipment, says Thomas Norman, manager at GE Healthcare Financial Services (Brookfield, Wis.). Norman also is committee chair for regulatory affairs and past president of the International Association of Medical Equipment Remarketers and Servicers (IAMERS, Chicago, Ill.).
There are times when a hospital may need a certain technology that is about to be upgraded, but cannot wait for the new generation to ship. In this case, a facility may be able to bridge the technology gap with a pre-owned system.
Healthcare providers must identify their needs to determine if used equipment is the best choice, notes Aaron Seff, vice president of marketing and sales for Alpha Remarketing (Del Ray Beach, Fla.).
A hospital buying a system to be competitive with a neighboring facility may not get a lot of use out of the equipment, at least initially, and should consider buying used vs. new.
The questions to ask include: what is your need? Where do you want to use it? What kind of work are you planning to do? And what is your budget? adds Seff.
Exactly what buyers should look for in pre-owned equipment is complicated and, at the same time, subjective. For one thing, equipment cannot be judged exclusively by its age.
A 15-year-old system that was well-designed and maintained may function better than a three-year-old unit now on the market, because design flaws may render the newer unit unacceptable, says Donald Bogutski, president of IAMERS and head of Diagnostix Plus Inc. (Garden City Park, N.Y.).
With pre-owned equipment, its past use is just as important as its present condition, even after reconditioning or refurbishing. Part of the refurbished equipments history should include information on how the unit was used in its previous life and its original date of manufacture.
If its coming from a large trauma center, it could have gotten very good use out of it, says Larry Sheppard, zone manager for Masterplan (Chatsworth, Calif.). It could be physically strained to the point where it will require a major refurbishment.
David Dickey, president and CEO of Medical Technology Management (Clarkston, Mich.), a biomedical engineering consulting firm, recommends that buyers obtain all maintenance records and service manuals, as well as the equipments warranty and who will provide the service after its refurbished, tested and installed.
Does the refurbisher have its own service staff? Dickey suggests, or does it have an agreement with the OEM to provide service during the warranty period?
Similar service commitments albeit for shorter lengths of time compared to new equipment should accompany a pre-owned purchase, experts recommend. Depending on the type of equipment, the purchaser also should take into consideration any upgrade plans, such as connection to digital systems, and have an understanding as to what will be required to further upgrade the product.
If it were me, Id want new glassware, too, adds Masterplans Sheppard, something that will last five to 10 years and which has a warranty for service, parts and labor.
The decision on the feasibility to have older technology refurbished also depends, in part, on how long a facility can do without the equipment. Sheppard says a comprehensive refurbishing stripping components to bare levels, replacing bearings and other items as needed, painting, reassembling and testing can take from four to six weeks. That could mean no patient throughput or revenues during that time.
Suppose youre working for a facility that must decide whether the old standby medical imaging system is worth refurbishing or should be retired gracefully. What do you do?
If you had a piece of equipment that exceeded its life expectancy, you probably dont want to take that and completely refurbish it, opines Masterplans Sheppard. No matter how it is refurbished, every component wont be replaced. There will be a lot of physical stress and wear on a lot of the weight-bearing components of the system.
In those cases, Sheppard recommends using the equipment as a trade-in for a similar piece of refurbished equipment.
Technology also is a consideration. Some working equipment may be so far behind the technology curve that an upgrade may not be possible or practical.
Most remanufacturers handle medical imaging modalities where there has been little technological advancements in recent years. High-field MRI would be one example, according to Integrated Equipment Solutions LLC (IES of Omaha, Neb.) and Cassling Diagnostic Imaging Inc. (Omaha). On the other side of the coin, IES and Cassling shy from working on open MRI systems, because there have been major advances in the technology, especially in image quality.
Its too new to get that technology in the old open MRIs, says Cassling President Michael Cassling.
You may not think of consulting a dictionary when buying used medical equipment, but defining terminology should be the first step because across the industry there are no clear definitions of the industrys jargon. Terms such as refurbished, remanufactured, rebuilt and reconditioned hold different meaning for different remarketers.
Customers dont know what theyre buying or what questions to ask, says former IAMERS President Norman. [They] are totally confused, because everybody uses the same words, but they get 15 different products.
Many remarketers agree. Steve Walsh, vice president of sales at Huestis ARI (Taunton, Mass.) says the terminology is widely misunderstood. The perception is that remanufactured is good stuff and refurbished is everything from a paint job to as is, he notes.
Huestis defines remanufactured products as ones in which the functionality is significantly changed. Defined that way a product would undergo a complete metamorphosis, for example, taking a CT scanner and turning it into a simulator where it no longer did CT, or if we took in an R/F room and turned it into a pain management [system], Walsh says.
By this definition, Huestis sells refurbished equipment, because the companys products, mainly systems from GE Medical Systems (Waukesha, Wis.), are brought back to OEM specifications.
GEMS, for example, says it refurbished a CT scanner with $100,000 of improvements, while somebody else does half of that, or wipes it down or paints it. We say we refurbished it and the other guy, in his mind, he refurbished it, too, Norman says. So, what is the real definition of refurbished, is it what he did or what we did?
That question will be difficult to answer until new FDA standards prevail, a process that could take a couple of years, but that will impose significant and much needed standardization.
These standards are going to level the playing field so if one vendor calls a system or piece of used equipment reconditioned, it will be the same thing as when another vendor calls it reconditioned, says IAMERS President Bogutski. If they call it remanufactured, it will mean the same thing. Therefore, people will not be taking pieces of equipment, cleaning them up and perhaps painting them and putting them out as remanufactured.
This month, the FDA is expected to release a draft of new Good Manufacturers Practices (GMP) to update the ones in place to regulate the industry since 1987. After a 90-day comment and review period, the FDA will conduct a hearing and the proposed GMP could be refined further. Final regulations will be issued sometime thereafter and then the coalition of healthcare organizations, led by IAMERS, will convene to structure implementation.
Norman says two essential components of the phase-in period will be educating buyers and sellers, followed by getting remarketers to adopt and adhere to the standards. Some people will jump at the chance to get on board and help straighten out the industry, and the other people will want no part of it because they dont want to make any changes, he says. A guy that just paints machines and makes all kinds of claims, this is the last thing he wants to do.
The GMP will be set up like a truth in advertising program, Norman adds. If you say you did boom-boom-boom, put it in writing and stand behind what you did. Its like running an ad in the newspaper for a car, if the car isnt available, you cant advertise it for sale. If you say youve put all new tires on it, then it has to have all new tires.
One option to achieve standardization is to have different color tags attached to the equipment to mean different things, he says. We call it a tagging program.
The new GMP will be implemented as a voluntary compliance program. The FDA is giving the industry a chance to monitor and police itself, however, the agency probably will be standing in the corner with a baseball bat for moral support, Norman adds.
Companies should not be lackadaisical about implementing and adhering to the new voluntary program, Norman warns. Youre never fully out from under the FDA, he says. As an example, he notes that there are existing regulations governing the sale of medical systems that also apply to used equipment. Plus, the FDA can at any time change the status of the GMP from voluntary to mandatory if the industry does not comply on its own.
Bogutski, speaking on behalf of IAMERS, says the voluntary nature of the GMP is a reflection that the industry has not had a serious problem, but rather a minor problem, with difficulties causing patient harm.
Huestis Walsh also agrees to a point. If youre just buying a used piece of equipment from a broker, then I think its very important that you get all the service records available from that product so that you know what youre buying, he says. At best, you can get a picture thats going to show you about 35 percent of the problems associated with that system unless someone is guaranteeing that it meets OEM specifications.
He notes that some used equipment has been modified over its life by service technicians a practice that would render the OEM manuals useless, because the documents will not match the machines internal mechanics.
Knowing who to trust
Because of the persistent problem with terminology and lack of prevailing standards, some in the industry still believe who you know, or the reputation of the remarketer, is key to buying quality pre-owned equipment.
Gary Nie, vice president at IES, suggests buyers deal with companies that are ISO 9000-certified and that buyers explore what a refurbisher does to improve the equipment.
Was it brought up to the OEM specifications? Is it put in a true test bay situation and will the system be tested as it will be used at the hospital? he asks. So many people just spray and pray and do the testing at the facility and try to make it work there.
Alpha Remarketing encourages customers to visit during pre-stage testing just before the product ships. We set it up just as if it were in the office or in the hospital, says Seff. The customer can come and see the unit set up, calibrated and running. He can touch it, he can make exposures, do whatever he wants to do to reassure himself that hes getting what hes paying for.
Seff estimates that approximately 25 percent of Alphas customers attend the pre-stage session.
As a final line of defense against potential problems, withholding final payment is advocated by some observers as a way to draw a companys attention for less than satisfactory results.
I would advise buyers to withhold a large percentage of the final payment until the device is up and running after the installation is complete for a period of 60 to 90 days to make sure they dont have a lemon, recommends Dickey.
This also makes allowances for remarketers to debug the system, so that youre not using your warranty period for them to debug their installation problems, Dickey says.
That may be sage advice, because even remarketers agree that problems should be anticipated. Even with new equipment, service and installation is always a problem, says Seff. Its never, never, ever perfect new, refurbed or otherwise. Theres always a glitch, always a problem, and always somebody has to take care of it.
The refurbishing industry has made strides through trade groups, such as the IAMERS, to clean up what has been perceived as a somewhat dubious wild west image, but some observers say some problems still remain.
IAMERS and a coalition of similar healthcare groups have been working with the FDA to address the need for unified industry practices. Revised guidelines are expected later this year, but since they will be voluntary in nature, it may take several years before the new regulations are implemented and adhered to fully across the industry.
Until then, standards may continue to remain lax and industry definitions will continue to vary from one equipment remarketer to the next. A smart buyer will fulfill his or her used equipment needs best by first determining the definition of used as outlined by the seller, along with the type and reputation of the remarketer selling the equipment, followed by knowing what system you need and its price.