MRG News & Views – December, 2013 Newsletter

End of Life Management.jpgEnd of Life Mgmt

Medical Equipment Lifecycle – End of Life Management

This month’s newsletter concludes our series on Equipment Lifecycle Management. We have followed the lifecycle medical equipment from capital budgets, to equipment selection & purchasing, implementation, and management/ support. The final step in this series is “End of Life Management.” In this issue we will focus on what needs to be addressed as capital equipment comes to the end of its useful life. Two key questions that need to be answered about decommissioned assets are:

  • Does the equipment have secondary market value?
  • What is the best course of direction for decommissioned assets?

Once an asset has been decommissioned, it’s important not to let it sit in storage for an extended period of time. The facility can be incurring costs and liabilities to store equipment and it’s depreciating in potential resale value the longer it sits.
There are different options available for decommissioned assets and it’s important to take a proactive approach when deciding what options make the best sense for your facility:

  • Trade in – if your facility is replacing or purchasing new assets, identifying fair market value prior to talking with the OEM about trade-in credits allows the facility to understand current market values and provides alternatives should the trade-in credit be minimal.
  • Resell – if the equipment has secondary market value, consider reselling the equipment to a third party vendor. Selling on the secondary market provides a return on investment and an avenue for disposition of the asset. Be sure to sell the equipment in “As Is, Where Is” condition with no warranties implied. Have a term of sale form in place that buyers are required to sign and make sure funds are secure before equipment can be removed from the property.
  • Donate – there are many 501C3 organizations that will accept donations of supplies and medical equipment. Many will have a list of assets that they are looking for. Be sure to establish timelines for the removal to avoid storing for long periods of time. Some charitable organizations struggle with transportation. Donations are typically tax deductible.
  • Reutilization – is there another area within the hospital or healthcare system that can utilize this equipment? Many times a sister hospital may have a need for the asset or could utilize the asset as a part unit to support another piece of equipment.
  • Salvage – Discarding equipment is typically a last option and there are many salvage/scrap companies that may be able to assist in this area. Many facilities have become conscience of going green and avoiding landfills as an option for discarding assets.

When approaching “End of Life” for your equipment, it’s important to be proactive instead of reactive once an asset is removed from service. Identify potential values and understand the best course of direction for your assets.

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MRG Recent Projects

2013 has been a very busy year for MRG and we are looking to finish strong!  This past year MRG has conducted over 70 audits, appraised over $28 million in assets and assisted hospitals to generate more than $1.1 million in resale dollars.

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MRG Holiday Fun Facts

Coca Cola Santa Claus

Coca-Cola created the modern Mr. Claus. When Father Christmas first began showing up in illustrations, he wore many different colored robes: Green, purple, blue, and brown, among others. Beginning in the late 1800s, it became popular to outfit Santa in a red suit. Artist Louis Prang depicted him that way in a series of Christmas cards in 1885, and The New York Times reported on the red garments in 1927. But the modern image of Santa Claus as the jolly man in the red suit was seared into American pop culture in 1931, when artist Haddon Sundblom illustrated him that way for a widely-circulated campaign for Coca-Cola.

Wishing you and yours a Very Merry Christmas, and best wishes for a Happy New Year!

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About MRG:

Manage Resource Group, Inc. is a privately owned healthcare equipment management company headquartered in Berea, Ohio.  Our client focused services create strategies for each customer to increase profitability on capital equipment.  We are industry experts offering the following service lines:

  •  Inventory services
  • Appraisal services
  • Resale management

For more information, visit our website at www.manageresourcegroup.net 

Replacement Budget Valuation Services

APPRAISE NOW Budget Valuation Service

Budgets are approved – you need to know the value of your old equipment.

APPRAISE NOW – Budget Valuation Service (BVS) identifies Fair Market Value for equipment displaced by new purchases. Knowing the value of these assets empowers decisions made on the proper avenue for decommissioned equipment. ie: trade-in, sale to secondary market, donated, or salvaged.

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Let us help you…

  • Identify fair market value (FMV) on systems and equipment that will be displaced with new purchases
  • FMV’s to help you negotiate higher trade-in credits and offer alternative revenue streams for equipment
  • Provide a proven sales method for system replacements and change-outs should the hospital wish to sell decommissioned assets
  • Determine the best course of direction for assets that will be displaced over the upcoming year

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Please contact Manage Resource Group, Inc. to learn more about APPRAISE NOW Budget Valuation Service.

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“Helping to assess, inform, and empower health care providers with their equipment management needs.”  For more information on MRG’s services, visit our website or contact us at (440) 289-6490.

www.manageresourcegroup.net

Where did all this surplus come from and how did it get here?

storage room with med equipOver the years MRG has been exposed to unique places where hospitals store surplus medical equipment:

  • Storerooms, closets and basements
  • Boiler rooms with temperature exceeding one hundred degrees
  • A warehouse where Henry Ford started the assembly line
  •  Tractor trailers, storage pods even a dumpster
  • Dungeons… Ok maybe not dungeons

There are many reasons equipment becomes surplus:

  • The asset has served its purposed life and is decommissioned
  • We need that asset for backup
  • The OEM is no longer supporting the asset
  • Dr. Jones had to have this piece of equipment and then he left after we purchased it
  • The hospital is trying to streamline its inventory throughout the system
  • We are renovating and may want to put the asset back into service

Whatever the reason and wherever your hospital is storing equipment it’s important to know that just because it’s out of sight does not mean it should be out of mind. Your facility may be spending money to maintain these assets or exposed to unnecessary costs by having them sit idle in storage. The longer assets sit the more they depreciate on the open market. MRG would be happy to visit those crazy places you may have equipment stored and we can help you turn idle assets into cash.