Healthcare systems can significantly reduce their operating expense capital outlays by better understanding their inventory of clinical assets, optimizing equipment use throughout the system and taking advantage of auction marketplaces.
In a TRIMEDX-sponsored Becker's Hospital Review webinar held in May, Murphy McGraw, director of product management and clinical asset management, and David Stevens, vice president of clinical asset management, both at TRIMEDX, discussed financial pressures that hospitals face and how intelligent clinical asset analytics can drive financial improvements.
Four key insights:
1. Mounting financial pressures create challenging consequences. Mr. McGraw cited a report from Kaufman Hall showing the average hospital operating margin in March 2022 was -2.4 percent and a report from McKinsey indicating 50 percent of health systems are deferring capital expenses to offset the pandemic's impact. Other financial pressures include an increase in labor expenses and a shift to alternate sites of care.
"These current challenges could lead to patients canceling procedures or experiencing unsatisfactory care, and clinicians that are frustrated about time spent looking for equipment," Mr. McGraw said. "Hospitals are perceiving equipment shortages, dealing with complex supply chain management constraints and using subjective capital planning processes, which can lead to emergency equipment purchases. This all can culminate in lost revenue, an increase in operational expenses, higher rental costs and ultimately wasted or misspent capital budgets."
2. Most hospitals have excess device inventory and underutilized assets, creating opportunities for redistribution. According to TRIMEDX's database and publicly available data, device counts are 48 to 64 percent higher per staffed bed than national benchmarks. Additionally, data from a leading network monitoring platform shows only a 40 to 50 percent device utilization. Most health systems have many more devices than they actually need or use. "Without full visibility of your clinical assets — specifically what you own, where it's located and how it's being used — you may lack the right equipment where and when it's needed or spend more than is required," Mr. McGraw said.
3. TRIMEDX offers a three-pillar plan to help health systems unlock the full potential of clinical assets. "Our best-in-class clinical engineering program delivers proven savings around industry-leading repair and maintenance, regulatory compliance, device uptime and patient safety," Mr. Stevens said. "We also have a robust cybersecurity program that proactively identifies and also solves for the risk to medical devices today. And, finally, our asset management program offers real-time device utilization data. These pillars are aggregated into a single device record, which allows us to prescribe objective recommendations for replacement, upgrade, disposition and reallocation of assets."
4. Financial results are realized from asset reallocation, better overall governance and understanding asset value on the open market. "The single source of truth into the visibility of your devices can reduce operating expenses by as much as 20 percent while also avoiding unnecessary capital expenditures by 25 to 35 percent," Mr. Stevens said, citing TRIMEDX data.
Mr. Stevens recounted how TRIMEDX worked with a customer that needed to replace its mammography units at a total cost of $4.9 million. "We helped them identify an upgrade path, which was a $200,000 expense, but it offset a $4.9 million capital investment," Mr. Stevens said.
Another customer allocated its capital budget by site, and one site was renting 25 infusion pumps per year because they didn't have the capital dollars to replace them. "By helping them work as a system, we ended up reallocating 20 underutilized infusion pumps from another site, helping them avoid roughly $50,000 in capital expenditures and eliminate $15,000 in annual rental expenses," Mr. Stevens said.
Effective clinical asset management drives significant financial results. "The goal is to ensure that you have the right equipment in the right place at the moment of need," Mr. Stevens said. Achieving this goal drives efficiencies and savings.
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