MRG News and Views – Leveraging ownership & control when selling surplus

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The secondary market has thousands of companies who purchase, consign and liquidate surplus medical equipment for hospitals.  Navigating this marketplace can be challenging and risky selling to buyers who don’t have the best interest of the hospital in mind when purchasing surplus medical equipment.  Hospitals need to leverage ownership of their equipment and not release control until payment and liability terms are met.  Following are key points every hospital should consider if they are selling surplus medical equipment to safeguard themselves:

  • When selling surplus make sure the buyer understands that the equipment is being sold “AS-IS, WHERE IS” condition with no warranties implied
  • Confirm that the equipment is not part of a lease or rental program with no liens attached to the asset
  • Remove hospital tags on equipment
  • Make sure accounting is informed that the equipment has been decommissioned and will be removed from the property (working with accounting for moneys received on sold equipment)
  • Have buyers sign off on a term of sale form indemnifying and releasing hospital of all liabilities associate with sale and future use of sold equipment. (involve hospital legal department when drafting this form)
  • If you’re selling imaging equipment make sure you notify your state of who and where the equipment was sold (the buyer should also be registered with the state they reside in to handle this type of equipment)
  • Require secure form of payment before equipment leaves the property (company check if you’re familiar with buyer, cash, wire transfer, bank check etc.)
  • Have the buyer be responsible for cost associated with shipping

Developing a policy and procedure for disposition of assets is advised for any healthcare organization and the resale of surplus should be part of this process.  If your organization resells surplus, implementing safeguards will allow for a hassle free transaction while minimizing risks associated with end of life equipment sale.

MRG Projects:

  • MRG recently completed a inventory and appraisal project for six OBGYN practices in KY with over 2000 assets, valued at $1,000,000.00
  • Michigan audit for radiation oncology practice valued over $700,000.00 in tangible assets

MRG Appraisal of the Month: 

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2007 Varian Medical Systems Clinac IX Linear Accelerator

Fair Market Value: $575,000.00

MRG Hospital Fun Facts:

On the set of Rocky IV, Dolph Lundgren punched Sylvester Stallone so hard that the hospital staff thought he was hit by a car.

Healthcare merger and acquisition activity likely to stay strong in 2016

blog photo 5.19.16

The landscape for post-acute and independent physician practice mergers and acquisitions looks to remain active for the remainder of 2016.  Much has to do with the inability for independent providers operating in a fragmented marketplace to provide value based care at a competitive rate with hospitals and health systems.

With volatility comes consolidation.  Uncertainties with the upcoming election is also playing a role in this activity.

http://www.modernhealthcare.com/article/20160101/MAGAZINE/301029931