A proactive approach to comprehensive clinical asset management helps healthcare systems maintain financial health
In healthcare, being proactive is key. Taking the necessary steps to prevent an illness is more efficient and more affordable than finding a cure. Following that notion, TRIMEDX’s proactive approach to comprehensive clinical asset management helps thousands of healthcare systems improve their financial health.
With a focus on optimizing inventory to meet current and projected patient demand, TRIMEDX CFO Chris Dunkerley said the business’s experience at more than 3,700 locations shows that the average health system may own more types of certain medical devices than needed and may replace devices more often than needed — even before this equipment reaches its full useful life.
Now, particularly amid a pandemic, this focus is critical.
“With COVID, there’s falling revenue, which means less money is available for capital,” Dunkerley said. “Understanding how to put some scrutiny and diligence in how you use capital is paramount.”
TRIMEDX helps health systems evaluate their use of medical devices to maximize their budget. They begin by determining the appropriate number of medical devices needed per site of care, considering patient volumes and utilization rate of those devices.
“How much equipment do you have? How much equipment do you need? Prove it,” Dunkerley said. “You don’t want money tied up in inventory you’re not using.
“You need to understand the financial impact, and make sure you are not constantly needing to spend [money] and replace assets without understanding what you have already.”
TRIMEDX developed a proprietary algorithm called the RUDR ScoreSM, which identifies medical equipment that should be replaced, upgraded, dispositioned or reallocated (to other sites of care). Assets are evaluated using objective data including benchmarks, leveraging the number of devices needed per patient volume, device specific utilization data, potential for impact to patient safety, including cybersecurity risk and more.
A score is assigned to each individual device and appropriate actions can then be taken to optimize inventory levels, which in turn can defer capital investments on medical equipment, making scarce capital dollars available for strategic initiatives and reducing operating expenditures.
“Doing more with less can have a huge impact,” Dunkerley said. “With less equipment, operational costs go down. If you have 10 CTs operating at 60% and want to get to 80%, drop one CT at the same location.
“From an operational standpoint, you’re not buying new equipment. You’re only maintaining nine instead of 10.” He said this is significant for cash flow and net income in addition to providing insights that can be used in future strategic planning initiatives.
Dunkerley acknowledged the emotional element associated with equipment needs but says data should be a bigger factor in the decision-making process.
Another aspect of TRIMEDX’s proactive and comprehensive approach to clinical asset management is their focus on extending equipment beyond its expected (or standard) useful life.
“Our goal is to really keep equipment alive,” Dunkerley said. “We’re not saying, ‘This is old. Let’s replace it. We are able to responsibly extend useful life and not impact patient safety or availability of equipment. Prevention is better than a cure.’”
A robust preventative maintenance program ensures every device is touched annually, leveraging data and history to identify an individual service plan for equipment. These plans include training and certifying technicians (if applicable), the ability to remotely monitor critical equipment to identify behavioral anomalies and through machine learning to predict potential issues and proactively dispatch a work order for a technician to initiate a repair even before an issue occurs.
This high-touch maintenance and repair program, along with access to quality parts through their global supply chain, allows TRIMEDX to extend medical equipment’s useful life by 30% with minimal disruption to patient care or unplanned downtime.
TRIMEDX’s suppliers are audited to ensure quality and provide access to parts for years beyond when an original equipment manufacturer would continue to supply parts.
Medical equipment manufacturers define “end of service” as the time after which they will not guarantee access to their own parts. Even if a piece of equipment may have several years of useful life remaining, the manufacturers will not use third-party parts.
When an original equipment manufacturer sets a useful life at eight years, TRIMEDX has been able to increase that life to 12 or 13 years.
With one client, TRIMEDX was able to extend the useful life of their CTs and increase their average age by 14%. This resulted in the value of the CTs, which exceeded the depreciated life, to increase by 48%.
“Those subsequent years, you’re not worrying about depreciation. You’re not buying new equipment. Your net income goes up,” Dunkerley said. “It’s a huge opportunity.”
TRIMEDX is an industry-leading, independent clinical asset management company in the United States delivering comprehensive clinical engineering services, clinical asset informatics and medical device cybersecurity. We help healthcare providers transform their clinical assets into strategic tools, driving reductions in operational expenses, optimizing clinical asset capital spend, maximizing resources for patient care, and delivering improved safety and protection. TRIMEDX was built by providers, for providers, and leverages a history of expert clinical engineering with data on 92% of all active medical device models.
This published piece is provided solely for informational purposes. HFMA does not endorse the published material or warrant or guarantee its accuracy. The statements and opinions by participants are those of the participants and not those of HFMA. References to commercial manufacturers, vendors, products, or services that may appear do not constitute endorsements by HFMA.