Slashing Biomedical Budgets In 2009
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Transcript of Slashing Biomedical Budgets In 2009
Surviving corporate mandates in the recession of 2009
Patrick K. Lynch, CCE, CBET, MBABiomedical Support SpecialistGlobal Medical Imaging (GMI)
Casual forum.Ask questions at any time.Ask questions at any time.Please place all phones and pages on silent.Morning and afternoon breaks, but refill as needed.g ,Restrooms are located . . .Lunch at noon, provided by Troff Medical Services, p yWe should be through by 4 PM at the latest.
Hospital‐employed BiomedsISO‐employed BiomedsBiomed‐related business‐people
All attendees are important. Please add to the discussion.
If you see this symbol . . . . Important topic – wake up and pay attentionImportant topic wake up and pay attention
Problems back at the hospital . . . . .Administration cut our budgetAdministration cut our budget.I cannot train my staff.My boss won’t let me hire staff I need.yHow can I do the same work with less staff?Administration cut out travel.‐‐‐
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work. W t d C t ( t ti )10 Ways to reduce Costs (presentation)
A spongy approach to cost analysisLessons from around the countryLessons from around the countryRound Table – self help from attendees
CBETCCE34 years in Biomed1st Pres of NCBAActive in certification of BMETs and CesMember of all Biomed AssociationsManaged large in‐house, ISO and corporate BiomedsCurrently, works for GMI is sales development, who sponsors my activities.
1. Understand the true severity of the financial crisis, as l d h l hrelated to healthcare.
2. Understand the traditional ways Biomeds have dealt with cost‐cutting directives and why they don’t work.g y y
3. Identify specific ways in my own facility to make a financial impact.
4 Learn a new way to view Biomed and the way we 4. Learn a new way to view Biomed and the way we contribute to the bottom line.
5. Learn from companies present how to affect the bottom liline.
6. Learn from others in the audience about things that work for them.
Leave here with more tools in your bag than when you arrived this morningthan when you arrived this morning.
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
Budget
Payroll, TechPayroll MgmtPayroll, MgmtPartsContractsO t id S iOutside ServiceTrainingSubscriptionsmisc
Budget
Payroll, TechPayroll, MgmtPartsContractsOutside ServiceTrainingSubscriptionsSubscriptionsmisc
Number of Productive Hours# of BMETs x number of hours
3 x 1240 = 3720 Productive BMET Hours(70% productivity)(7 p y)
Cost analysisSalary x 1.25 (benefits)3 x $40,000 x 1.25 = $150,000 per year
Cost Per Hour of Productive BMETT t l t / t t l h t hTotal cost / total hours = cost per hour$150,000 / 3,720 = $40.32 per hour
Per hour cost increases as productivity increases.Per hour cost increases as mgmt. and sec. costs added.
Includes all persons not turning a screwdrivergSupervisorsSecretariesP t Cl kParts ClerksReceptionists
All are viewed by upper management as much more All are viewed by upper management as much more expendable than technical staff.Must be able to justify their need very well.j y y
Always needed.Few options.Expensive parts make a big difference.
CT TubesCryogensUltrasound Probes and TEEsUltrasound Probes and TEEs
Often‐used parts make a big difference.PM kitsPM kitsBatteriesLead wires
Parts contracts can be evaluated for cost‐effectiveness.C h i l d l b l l BAD!Contracts that include labor are almost always BAD!3 Components of a contract:
Certain (100%) need PMs PM kitsCertain (100%) need – PMs, PM kits.Unknown (??) need – repairs (downside is always inflated)Unrelated extras –
Clinical support for usersClinical training (for users)Clinical training (for users)Software upgrades
Greatest opportunities for cost savingsCompare biomed hourly costs to manufacturer hourly costs.
Items sent out for repairItems sent out for repairLabor called to hospital for service needs.Used when:Used when:
Special technical knowledge is not possessed by in‐house staff.In‐house staff does not have time to complete all work.Special test equipment is required.
M f h iManufacturers are the most expensive.Often local shops can be cost effective.
Not the same as other travel in the hospital.Technical training is necessary for Biomeds to be able to work on the equipment as it comes out of warranty.NOT AN OPTION!Biomed must work hard to make administration see th t Bi d T i i i t lik i t that Biomed Training is not like a nurse going to a nursing conference.
Travel for a nurse or resp tech means going to an lannual convention.
If they don’t go for a few years, they can still take care of patientsof patients.If Biomeds don’t go to school, they soon become obsolete, and are forced to put things on expensive contracts.Training for a Biomed means acquiring new skill to save money.save money.Biomed travel and training should NOT be evaluated the same as other hospital travel and training.
Travel for a nurse or resp tech means going to an g gannual convention.If they don’t go for a few years, they can still practice h i f itheir profession.If Biomeds don’t go to school, they soon become obsolete and are forced to put things on expensive obsolete, and are forced to put things on expensive contracts.Biomed travel and training should NOT be evaluated gthe same as other hospital travel and training.
Travel for a nurse or resp tech means going to an g gannual convention.If they don’t go for a few years, they can still practice h i f itheir profession.If Biomeds don’t go to school, they soon become obsolete and are forced to put things on expensive obsolete, and are forced to put things on expensive contracts.Biomed travel and training should NOT be evaluated g Othe same as other hospital travel and training.
Travel for a nurse or resp tech means going to an g gannual convention.If they don’t go for a few years, they can still practice h i f itheir profession.If Biomeds don’t go to school, they soon become obsolete and are forced to put things on expensive obsolete, and are forced to put things on expensive contracts.Biomed travel and training should NOT be evaluated o ed t a e a d t a g s ou d O be e a uatedthe same as other hospital travel and training.
Travel for a nurse or resp tech means going to an g gannual convention.If they don’t go for a few years, they can still practice h i f itheir profession.If Biomeds don’t go to school, they soon become obsolete and are forced to put things on expensive obsolete, and are forced to put things on expensive contracts.Biomed travel and training should NOT be evaluated gthe same as other hospital travel and training.
Technical information constantly emerging.
Management information constantly emerging.
Regulatory information constantly emerging.
Medical Equipment management strategy constantly changingchanging.
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
Reduce your spending by 10%!
Reduce your spending by 10%!
What they really mean is:y y
Reduce your spending by 10%!
What they really mean is:y y
R d di b 10%!Reduce your spending by 10%!
R d di b 10%!Reduce your spending by 10%!
NOW!
NNo
NNo
and
YesYes
No . . . . . . No . . . . . .
b h i i l because the pain is real.
And it will get worse. We haven’t seen anything yet We all have to tighten anything yet. We all have to tighten our belts.
Yes Yes . . . . .
. . . because the bigger goal is not to just reduce Biomed costs but to just reduce Biomed costs, but to reduce HOSPITAL costs.
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
What if EVERY piece of technology in a hospital were seen as a sponge?Size of Sponge = value of equipmentAmount of water in the sponge = MONEY to maintain
MRILab Servers
CT
Copiers
Sterilizers
Copiers
Aneses
General Biomedical Equipment
Ultrasound
Linear Accelerators
Cad Access
==
==
MRILab Servers
CT
Copiers
Sterilizers
Copiers
Aneses
General Biomedical Equipment
Ultrasound
Linear Accelerators
Card Access
Reduce your spending by 10%.Reduce your spending by 10%.
Biomed Response: pHow? Where?
Typical Biomed Approaches to cost reduction
Reduce PMsCut OvertimeReduce services to customersShift costs back to customer cost centersShift costs back to customer cost centers
What the C‐suite really wants . . . .
Find a way to reduce costs as much as possible, but the i i h ld b l % f minimum should be an amount equal to 10% of your
current year’s budget.
The key to remember:
The way for Biomed to increase value to the hospital is to , not contract.
Biomedical Engineering specializes in wringing the cost out of medical equipment service, while
i t i i ( i i ) th li bilit f t d maintaining (or increasing) the reliability, safety and accuracy for the overall good of the patient and caregivers.g
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
• Ultrasound MachinesMUSE systemLinear AcceleratorSterilizer Service
Old State: (phase 1 – total OEM contracts)Manufacturer contract ‐ $250,000 / year
Transition State: (got trained, use third parties, begin doing PMs)T i BMET it f t t t iTrain BMET, wait for contract to expire
Final State: (phase 4)In‐house serviceouse se v ce
Savings:$180,000 per year
Added benefit – first step into Imaging Service.
Old State:Manufacturer Contract ‐ $44,000 per year(hardware, software, upgrades)(Cost of actual service delivered if bought at market prices (Cost of actual service delivered, if bought at market prices was $15,000 per year.)
Transition State:Train BMET
Final State:Service In‐houseService In house
Savings:$30,000 per year less cost of software upgrades
Old State:Manufacturer Contract ‐ $425,000 per year
Transition State:S it h t ISO t t $ Switch to ISO, contract $250,000 per yearAgreed to train in‐house BMET
Final State:In‐house servicePromotion for BMET
S iSavings:$300,000 per year
Old State:Manufacturer Contract ‐ $125,000 plus parts
Transition State:Biomed manages outside contractBiomed manages outside contract
Final State:Biomed hires Facilites Eng, cancells contract
S iSavings:$75,000 per year
Hired person from engineering.
Best ideas from around the country:Keep end‐of‐life equipment operational as long as financially and technologically feasible.
Buy used equipment for spares parts backupsBuy used equipment for spares, parts, backups.
Best ideas from around the country:Keep end‐of‐life equipment operational as long as financially and technologically feasible.
Buy used equipment for spares parts backupsBuy used equipment for spares, parts, backups.Remove unused medical devices from service, retire, adjust staffing and costs accordingly.
Best ideas from around the country:Keep end‐of‐life equipment operational as long as financially and technologically feasible.
Buy used equipment for spares parts backupsBuy used equipment for spares, parts, backups.Remove unused medical devices from service, retire, adjust staffing and costs accordingly.Purchase used, refurbished equipment to stretch capital dollars..
Best ideas from around the country:Keep end‐of‐life equipment operational as long as financially and technologically feasible.
Buy used equipment for spares parts backupsBuy used equipment for spares, parts, backups.Remove unused medical devices from service, retire, adjust staffing and costs accordingly.Purchase used, refurbished equipment to stretch capital dollars.Barter – trade service with area hospitals instead of Barter trade service with area hospitals, instead of duplicating training.
A: Instead of this, we have repeatedly shown them where A: Instead of this, we have repeatedly shown them where we can reduce the budgets of other departments, as the repair costs are not in our budget.
They are really just looking for a bottom line reduction, d h it t th it’ t i t t hi h and once you show it to them, it’s not important which
department budget line really hits.Karen WaningerKaren Waninger
Encourage people to use their PTO. While it does not show up any different in our actual budgets, it does reduce the p y g ,debt liability for the hospital. They have already accrued the expenses, so if people actually use the PTO, they reduce the balance in the accrual account.Stretch out the calibration on test equipment, do it every 2 years instead of every year, unless you start to see drift with specific devices. Just make sure your policies are updated to reflect what you are doing thereto reflect what you are doing there.See if you can sell any of your old test equipment (NOT medical equipment) on eBay and use that money for new tools etc Make sure that your hospital has approved that tools, etc. Make sure that your hospital has approved that approach, though, and that everything is above board with tracking the assets.
Karen WaningerDirector, Clinical EngineeringCommunity Health Network
The Economic CrisisHow it affects Healthcare and HospitalsHow Biomeds typically respond to financial pressures and why these do not work.10 Ways to reduce Costs (presentation)A spongy approach to cost analysisLessons from around the countryR d T bl lf h l f dRound Table – self help from attendees
Alan Koreneff – Corporate Director of Clinical Engineering, Novant Health, CharlotteSonny White
What works for you?What has NOT worked for you?Are you willing to look in non‐traditional places for expansion opportunities?Why are you here?
1. It’ll be worse before it is better.2. Everybody is in the same situation.3. Expand your vision beyond patient care.
Th Bi d i h l l i i 4. The Biomed is the least costly way to maintain medical equipment.
5. To save more, Biomed must expand.5. To save more, Biomed must expand.6. Travel and training budgets for Biomed are different
than for the rest of the hospital.7. Use the sponge analogy to identify your sponges.8. Use SVR and the parfait slide to identify fat sponges
which need squeezingwhich need squeezing.9. NETWORK – use your friends for ideas.
Why did you come here today?Did you find some answers to your problems?What is the next step?What can the NCBA do for you?S ti d t ( l l )Suggestions and comments (always welcome)
Pl t l ti fPlease return evaluation form.
f hi i For a copy of this presentation, email [email protected]
For assistance with a plan to move safely into imaging service, contact l h@[email protected]
If you would like this presentation made for your y p yorganization, contact [email protected] or [email protected]