Why should hospitals conduct a facility-wide capital asset inventory?

When making daily decisions on capital assets it’s imperative to utilize accurate data. As the old saying goes “information is power”. Old or corrupted data presents many headaches and challenges for administrators, finance, clinical staff, biomed and ultimately the ability to provide the best patient care possible.

Frequently Asked Questions (FAQs):

Q: Are we utilizing an asset ledger that is accurate and current?

A: It’s not uncommon for a hospitals asset ledgers to contain decommissioned assets, renovations, leases, operational expenses etc. This can expand a ledger line item count by 6 times that of actual assets located in the facility.

Q: Is our ledger sortable and able to search specific equipment demographic fields?

A: Many hospital ledgers do not separate equipment information into individual fields. I.E. make, model and description are identified under one field which creates an inability to sort on specific fields criteria. This also make it very difficult to reconcile the ledger on a regular basis.

Q: When was the last time our hospital conducted a facility-wide inventory?

A: If the hospital has not conducted a facility-wide inventory for more than 5 years the ledger may show an inaccurate view of what is physically located in the property. Past audits have revealed a 15%-20% match rate when reconciling against old ledgers.

Q: Does our facility have a barcode tag (unique identifier) applied to assets that is streamlined for use by all departments?

A: Utilization of single barcode tag (unique identifier) for all departments provides ease of tracking when conducting preventative maintenance, ongoing reconciliation and budgeting

Q: Are we confident that the equipment located in the facility is accounted for?

A: Equipment residing in the facility should be accurately accounted for. Unaccounted equipment increases cost associated with insurance, preventative maintenance, storage and potential litigation if a patient is harmed.

Q: Do we have a detailed process outlining adds/deletes to the ledger as equipment enters and leaves the property?

A: Detailed process and procedures ensures hospital staff are following appropriate guidelines when equipment arrives and leaves the facility. This eliminates the chance of equipment bypassing proper clinical inspection when being put into service and detailing what happens to the asset when decommissioned

MRG Newsletter September 2017

FMV Appraisals/Definitions

 

Hospitals and healthcare facilities require appraisals on a daily basis to determine FMV (Fair Market Value) on capital assets.

Uniform Standards of Professional Appraisal Practice (USPAP) is considered the quality control standards applicable for real property, personal property, intangible assets, and business valuation appraisal analysis and reports in the United States.

We thought it would be beneficial to share with clients the different types of appraisals and definitions that are used when applying FMV to capital assets:

Fair Market Value – Installed
FMV-I is the estimated amount, expressed in terms of money, that may reasonably be expected for an installed property in an exchange between a willing buyer and a willing seller, with equity to both, neither under any compulsion to buy or sell, and both fully aware of all relevant facts, including installation, as of a specific date. (This amount includes all normal direct and indirect costs, such as installation and other assemblage costs, to make the property fully operational but does not have to be supported by the business earnings.)

Fair Market Value – Removal
FMV-R is the estimated amount, expressed in terms of money, that may reasonably be expected for a property, between a willing buyer and a willing seller, with equity to both, neither under any compulsion to buy or sell and both fully aware of all relevant facts, as of a specific date, considering the cost of removal of the property to another location.

Fair Market Value in Continued Use
FMV-CU is the estimated amount, expressed in terms of money, that may reasonably be expected for a property in an exchange between a willing buyer and a willing seller, with equity to both, neither under any compulsion to buy or sell, and both fully aware of all relevant facts, including installation, as of a specific date, and assuming that the earnings support the value reported. (This amount includes all normal direct and indirect costs to make the property fully operational and may not readily pertain to aircraft.)

Fair Market Value
FMV is the estimated amount, expressed in terms of money that may be reasonably expected for a property in an exchange between a willing buyer and a willing seller, with equity to both, neither under any compulsion to buy or sell, and both fully aware of all relevant facts, as of a specific date.

Forced Liquidation Value
FLV is the estimated gross amount expressed in terms of money that could be typically realized from a properly advertised and conducted public auction, with the seller being compelled to sell with a sense of immediacy on an as-is, where-is basis, as of a specific date.

Orderly Liquidation Value
OLV is the estimated gross amount expressed in terms of money, that could be typically realized from a liquidation sale, given a reasonable period of time to find a purchaser(s) with the seller being compelled to sell on an as-is, where-is basis as of a specific date.

Salvage Value
Salvage Value is the estimated amount expressed in terms of money that may be expected for the whole property or a component of the whole property that is retired from service for use elsewhere, as of a specific date.

Scrap Value
Scrap Value is the estimated amount expressed in terms of money that could be realized for the property if it were sold for its material content, not for a productive use, as of a specific date.

MRG Projects:
I&A services for M&A in OH and KY

MRG Appraisal of the Month:
1qty GE V-Scan handheld ultrasound
-FMV: $4000.00

 

 

 

MRG Fun Facts:
Jimmy Carter was the first president to be born in a hospital.