2012 DIAGNOSTIC INSTRUMENT BUYING GUIDE
The Art of Equipment Acquisition
In lean times, doctors know where to save, where to spend and how to get the most bang for their bucks.
By Erin Murphy, Contributing Editor
With practices facing so many competing pressures, from declining reimbursements to new electronic health record (EHR) requirements to patients with less to spend out of pocket, a practice's dollars are counted and tracked quite closely. Practices weigh their purchasing decisions very carefully. Now, more than ever, purchasing is something of an art, requiring a savvy combination of creativity and planning to ensure you get what you need in the most profitable manner possible.
More Doctors Buying Used
This current purchasing trend certainly won't surprise you: When money is tight, demand for used equipment goes up. Buying used is a key part of the savvy approach to purchasing.
“The demand for used equipment has spiked,” says Gordon Siteman, Vice President of sales and marketing for Lombart Instruments, an ophthalmic instrument distributor based in Norfolk, Va. “Practices are investing in EHRs and all the accompanying hardware and software, we in turn compete for the same dollars, and many doctors compensate by buying used equipment when possible.”
For some doctors, buying used equipment is an entirely new approach.
“A few years ago, as the economy softened, practices that hadn't considered used equipment in the past started coming to see us. The reaction we're getting is that those physicians are pleased with the quality of their purchase and plan to buy more used equipment in the future,” explains Chris McDougall, Vice President of Enhanced Medical Services, a distributor of new and used eye care equipment based in St. Louis. “With reimbursements down, even physicians who don't have the budget for the latest new equipment right now can offer excellent technology to their patients by purchasing used equipment.”
|“In most cases, used equipment provides doctors the same level of service as new. The one pitfall is that because of heightened demand, everyone is looking for the same recent model — ‘like new’ devices — so they're not always easy to find.”|
— Gordon Siteman
However, not all types of used equipment are in hot demand. As savvy physicians choose where to spend their dollars, they spend money on new equipment that will make money.
“We sell all of the core ophthalmic equipment that's used in a general eye exam, such as the slit lamp and phoroptor, as well as chairs and stands. Practices are often comfortable buying these instruments used,” Mr. Siteman says. “We don't deal in some of the more sophisticated devices such as OCT or the IOLMaster (Carl Zeiss Meditec), which practices often purchase new because these devices have a specific CPT code and thus have a greater potential to increase revenue.”
Advantages of Used Equipment
If you're new to buying used, you might wonder what types of equipment are out there and what kind of quality you can expect from used devices. According to Chris McDougall, you can expect similar quality at an affordable price.
“We offer everything from autorefractors to excimer refractive lasers, sometimes in the very latest model, or sometimes one model earlier,” he says. “Physicians don't have to compromise. They give patients the same high level of care for an excellent value, with lower prices and the same financing options as new equipment.”
|“A few years ago, as the economy softened, practices that hadn't considered used equipment in the past started coming to see us. The reaction we're getting is that those physicians are pleased with the quality of their purchase and plan to buy more used equipment in the future.”|
— Chris McDougall, VP
Still, buying used equipment isn't the same as buying new. Buyers don't have the reassurance of getting the manufacturer's name and support behind the sale. What if something goes wrong with the device? What if you need help? These are questions that a reputable distributor of used equipment can answer.
“When doctors come to see us for the first time, they're typically familiar with the devices and know what they want,” says Mr. McDougall. “To make them feel comfortable with the purchase, I educate them about our company's reputation, the reconditioning process and warranty for used equipment and the ‘bigmanufacturer’ support we provide, including tech support online and on the phone, and in-office training. Once doctors understand the quality of our equipment and the services we provide, they're confident about buying from our company.”
Benefits of New Equipment
Many of the benefits of new equipment versus used are no-brainers. In car terms, the odometer is on zero. You don't have to wonder who owned the car before and how they treated it. There's no need to bring a mechanic friend to look under the hood because it comes straight from the assembly line. And, as Gordon Siteman points out, you get to choose exactly what you want.
“In most cases, used equipment provides doctors the same level of service as new,” he says. “The one pitfall is that because of heightened demand, everyone is looking for the same recent model, ‘like-new’ devices, so they're not always easy to find. And when doctors do find what they want, they have to check the reseller's reputation to ensure that they're getting the product that they think they are.”
Still, we're talking about major purchases here. Sticking with the car metaphor, that slightly used item has already undergone its “driven-off-the-lot” depreciation — the kind of depreciation that makes the sensible part of our brain guilt us into buying a used car, no matter how much we really want the new one. But a piece of ophthalmic equipment isn't a car. In fact, there's a good chance that you'll actually hold onto some equipment much longer than you'll keep your vehicle.
“We often tell doctors that in the end, if you buy the best, you won't be disappointed,” explains Mr. Siteman. “A new, quality slit lamp will serve you well for your entire career. The actual cost over the life of the instrument isn't great. And by paying a premium, you get to use the best and keep it for many years with fewer problems down the road.”
Lease or Buy?
Whether you choose to purchase new or used equipment, you have the option to buy the equipment in cash, get a loan or lease it.
Certainly, buying something outright means one less bill every month, but this may not be feasible. According to Mr. Siteman, if you're choosing between a loan and a lease, leasing is often the more affordable option.
“You can lease 100% of the purchase, including soft costs like software and leasehold improvements to the practice. A conventional bank lender requires a down payment of about 20% to 25%, so for a $100,000 purchase, you have to provide $25,000. That depletes your cash reserves,” he says. “The approval process is also much more rigid in banking compared to leasing. Leasing has no liens or cosigns — just a Uniform Commercial Code (UCC) filing on the equipment.”
Other advantages to leasing include faster return on investment, stronger purchasing power, enhanced financial flexibility and better access to the latest equipment and a fast and easy leasing process. (See “The Rewards of Leasing Equipment” on page 14-S).
If you're considering making a purchase soon, you've already done your research and tried the devices you want. The “art” lies in how you make it happen. New or used equipment, cash, loan or lease —options are out
|A Six-point Checklist for Purchasing Used Equipment|
|1. Assess your equipment needs and preferences in relation to the budget you have available for capital expenditures.|
2. Balance the lower initial cost of used equipment against the longer useful life, better warranty, parts availability and upgraded features that are often valid reasons for purchasing new equipment.
3. Deal only with reliable sellers who have an established track record and who can maintain any used ophthalmic equipment you buy.
4. Buy “used” only when the product will not quickly be rendered obsolete by changing technology.
5. Obtain a service history of any piece of equipment you are considering.
6. Be careful about buying any pre-owned equipment used in invasive surgical procedures. You could be held liable for problems caused by faulty equipment.
From “Purchasing Pre-owned Ophthalmic Equipment”
By Gerald Helzner, Senior Editor
Originally published July 2007, Ophthalmology Management
|The Rewards of Leasing Equipment|
|Mike Napier is Director of Healthcare Program Management at De Lage Landen, a leasing company with American headquarters in Wayne, Pa. He says that leasing gives buyers access to low rates and potential tax benefits. Leasing also offers these additional key advantages:|
• Expanded purchasing power
Monthly payments make purchases more affordable. Obviously, it's easier to pay $1,000 a month than it is to pay $50,000 up front. That also means you can afford to get more equipment or other products. Maybe an ancillary item such as an extended warranty or service contract costs $5,000, but it will only increase your monthly payment by a $100 if you bundle it into your lease.
• Preserved capital and existing credit lines
By getting another source of money outside your existing credit lines, you can keep more money on hand and use bank lines for other purchases.
• Cash flow management
When you lease, because you're not paying for your equipment up front, you start realizing your return on investment very quickly. Your lease payment on an OCT might be a little over $1,000 per month, but you can produce $2,000 a month in revenue performing only a couple of procedures per day. There's positive cash flow immediately.
• One-stop shopping
We have relationships with manufacturers like Carl Zeiss Meditec, where customers only need to deal with one person for both their equipment and financing, making it more convenient than having to secure financing separately.
• Painless credit and documentation process
Leasing is much more streamlined than getting a business loan from a bank. Most of the time, leasing just involves a simple credit check and possibly a set of tax returns. It's often done over the phone within an hour. Doctors sign a one-page document, and then the leasing company sends a purchase order to the manufacturer, usually in just a few hours.
• Flexibility to upgrade
The value of equipment is in its use, not in ownership. When an equipment upgrade will enhance patient care, you want that upgrade, and leasing makes it easy. If a new model has major enhancements 3 years into your 5-year lease, the leasing company can easily convert the lease to the new equipment.
Conserving Space, Time and Capital
Portable and multifunctional instruments provide several benefits.
By Desiree Ifft, Contributing Editor
Each ophthalmology practice is different, but most contend with a common set of challenges. High on the list of these perennial issues are the need to streamline patient flow through the office, maximize the use of space, which is often tight, and stick to a capital equipment budget. Choosing to purchase diagnostic devices and equipment that are portable or multifunctional can be a big help, adding flexibility to how space is used, and, in many cases, saving time and money.
Smart Equipment Choices Help to Ease Growing Pains
Since about 12 years ago, when three practices merged to become the Eye Center of North Florida, the physician-owners have added on to the main office, built new satellite offices, and changed the ways they use the various spaces available to them.
“As a practice grows, it's not uncommon to add doctors, exam lanes, more and different equipment, new and different products or service lines and more personnel,” says Medical Director Bret L. Fisher, MD. “The competition for space can become a real challenge, and it's something we deal with on a fairly continual basis.”
The Retinal Acuity Meter (AMA Optics, Inc.)
Utilizing portable diagnostic devices is one way the doctors and staff keep everything flowing smoothly. At this time, they have six different technologies that are portable, meaning they can be easily carried — some in a pocket — by a single person from one area to another for use on a patient. “All of the portable devices are kept in a central location that is accessible to all of the examination areas and technicians, which conserves both space and capital,” Dr. Fisher says.
Using the Retinal Acuity Meter, or RAM, (AMA Optics, Inc.) as an example, Dr. Fisher explained the benefits of the portable devices. “We use the RAM in several ways, most frequently for predicting the level of vision patients can achieve in an eye after cataract surgery. This is especially useful in eyes with comorbidities, such as agerelated macular degeneration or glaucoma, that may confound the picture, or in patients who are interested in a presbyopiacorrecting IOL. In the premium IOL cases, being certain an eye has normal visual potential is even more critical.” Using the pinhole effect to minimize the light-scattering and blurring caused by a cataract, the RAM also enables patients to read “around” a cataract, giving them an idea of what size print they may be able to read after surgery.
Dr. Fisher also uses the RAM, which weighs just 5.5 oz., in patients whose vision isn't improving as expected after cataract surgery, to determine whether the potential for better vision exists. “Certainly OCT is very important in looking at retinal anatomy and can screen out preexisting structural pathology before surgery, and having a normal OCT is very reassuring,” he says. “We have the Spectralis spectral domain system (Heidelberg Engineering) that we use for this purpose, but it's not portable. The RAM enables us to obtain very accurate information that would be difficult to obtain otherwise. It's easy to use for both the technician and patient, and the ability to bring it to patients in the exam lane without having to move them makes it very efficient and timesaving. It's priced under $1,000 and can also be used to test contrast sensitivity, so it's cost-effective. As our need for retinal acuity testing increases, we'll add a second unit.”
|“As a practice grows, it's not uncommon to add doctors, exam lanes, new and different equipment, new and different products or service lines and more personnel. The competition for space can become a real challenge, and it's something we deal with on a fairly continual basis.”|
— Bret L. Fisher, MD
For performing pachymetry, Eye Center of North Florida doctors take advantage of several combination devices as well as portable devices. In addition to a Lenstar LS900 optical biometer, a Tomey EM3000 endothelial cell counter and an Oculus Pentacam HR, all of which also measure corneal thickness and are located in the central exam area, they regularly use a Pachmate DGH 55 portable pachymeter from DGH Technology.
Four additional portable instruments, all handheld, factor into the practice's daily routine: the Marco BAT1000 brightness acuity tester, the Mentor Tonopen XL tonometer, the Oasis Colvard Pupillometer and the Heine HSL 150 slit lamp. “In the clinic or ASC, we use the handheld slit lamp for patients who are unable to sit at a regular slit lamp,” says Dr. Fisher. “For example, for a stretcher-bound patient coming from a nursing home to our office for evaluation of a dense cataract, it may be the only way we can visualize the anterior segment prior to surgery.”
Adding tablet technology to various aspects of an eyecare practice is another way to save time and space. Dr. Fisher says he and his colleagues are currently transitioning to a LUMA app (Eyemaginations) for the iPad. “Our early impression is that it will be very helpful in the patient counseling, education and conversion processes.”
|“It's always important to be frugal when considering equipment purchases, even more so when the equipment is for a satellite office that isn't operating at full capacity every day of the week.”|
— Eddie Kadrmas, MD
Portability Equals Cost-Effectiveness for Multiple Sites
To help cost-effectively diagnose patients at its main office and four satellite offices, Post, O’Connor & Kadrmas Eye Centers in Massachusetts routinely uses a portable fluorescein angiography (FA) digital imaging system.
Several years ago, the practice was one of the first to acquire the device, which is a portable version of a WinStation (formerly Ophthalmic Imaging Systems; now Merge Healthcare). It attaches to any non-digital fundus camera, enabling it to capture digital fundus and FA images that are saved to a laptop computer. “Using this device, we have fully digital FA systems without having to replace our existing fundus cameras,” says Eddie Kadrmas, MD. “It's always important to be frugal when considering equipment purchases, even more so when the equipment is for a satellite office that isn't operating at full capacity every day of the week. That's where the benefits of the portable digital FA device come in for us. Obviously it's far less expensive than buying brand new digital systems for every office.”
Post, O’Connor & Kadrmas Eye Centers leverages portability not only for diagnosing, but also for treating patients. It owns two portable 532-nm frequency-doubled YAG lasers from IRIS Medical (now Iridex Corporation). The lasers are used in specific exam lanes at the main office, but are transported to satellite offices when needed. They are used by the retinal specialists for focal, grid and panretinal laser treatments, and with an indirect headpiece to repair retinal tears and detachments. The practice's glaucoma specialists can also use them for trabeculoplasty and laser suturelysis after trabeculectomy. “On days I am working in a satellite office, I can easily bring the laser with me in the back of my SUV,” Dr. Kadrmas says. “It's also easy to bring into the OR, where I use it for procedures such as endolaser in diabetic patients and retinal detachment repairs. The portable lasers and the portable digital FA system are both convenient, efficient and cost-effective ways to deliver care. Both technologies have been workhorses. We have been using them for years and they are very reliable.”
Speed, Accuracy & Mobility = A Useful Combination
To better meet the needs of medical practices, diagnostic instrument manufacturers often aim to develop devices that are faster, more compact and capable of more than one function. The Retinomax K-Plus 3, a handheld autorefractor and keratometer (Right Medical), is one example of such a device in use at Specialty Eye Care in Colorado. According to E. Randy Craven, MD, “We measure all new patients with the Retinomax to obtain K values and an autorefraction as a baseline for evaluating astigmatism and a starting point for the full refraction. It's accurate, small and light, so it works well for testing children. We can easily carry it into the OR, too, in order to autorefract to confirm the accuracy of the IOL power at the end of a case.”
|“It's not difficult for a practice to find itself in a situation where every square foot is packed with equipment or lane space. The challenge is to make the best use of space without creating bottlenecks for patient flow or negatively impcting patient privacy and comfort.”|
— Tom Burke, CEO
Dr. Craven says the K values the Retinomax provides are very helpful in deciding whether a toric IOL would be the best choice for a patient. “With the fast Ks we can evaluate how much of the astigmatism is corneal,” he explains, adding that the instrument is kept in the tech area and used for 12 rooms. “There is never much of a wait for it because it's super fast,” he says.
Goodbye to Bulky, Expensive Printers and Other Frustrations
Not unlike other practices, particularly in large metropolitan areas, Ophthalmic Consultants of Long Island (OCLI) pays a high price per square foot of space. In addition, providing quality care in ophthalmology depends heavily on diagnostic technologies, which tend to increase in number on a fairly regular basis. As a result of these dynamics, “it's not difficult for a practice to find itself in a situation where every square foot is packed with equipment or lane space,” says Tom Burke, Chief Executive Officer at OCLI. “The challenge is to make the best use of space without creating bottlenecks for patient flow or negatively impacting patient privacy and comfort.”
Burke explains how the Synergy Ophthalmic Data Management System (Topcon Medical Systems), which integrates images and reports from Topcon diagnostic equipment and more than 130 other brands into a single, secure, digital environment, is helping OCLI to meet this challenge. “Digital imaging and diagnostic test results can be electronically ported to a centralized image management system — either to an in-house server or a Web-based server, which saves on management costs and infrastructure — that serves all of our lanes and offices. Instead of using a range of printers from black-and-white thermal to color inkjets that are costly to run and maintain due to the volume of testing, and then having someone physically run the printouts to the patient's exam lane, our doctors can now bring up the images right in the lane on workstation monitors as part of the EHR. They also can view test results from home, another office or the ASC.”
|“Most of our doctors didn't realize just how annoying the cords were until they experienced what it was like to be free of them.”|
— Matt Ruskin, technical supervisor
OCLI Technical Supervisor Matt Ruskin says Synergy has already allowed the practice to eliminate about two dozen printers from its offices, and that number will increase as Synergy is installed at additional locations. “And once we convert to full EHR and no paper charts, we will save substantially more space,” he adds.
Ruskin cites the consolidation and miniaturization of testing equipment in general as an additional space-saver. “It seems every time we upgrade a machine, the new one tends to have a smaller footprint,” he says. The practice recently replaced a retinal camera with a new Spectralis. “It takes the place of two machines, which is a great space-saver,” Ruskin says. “However, we do still have a previously acquired OCT device to use when the Spectralis is being used as a retinal camera.” He also mentions another of the practice's newest instruments, the TearLab Osmolarity System (TearLab Corporation), “which essentially puts an entire laboratory on a chip smaller than a square inch through the use of microfluidics and electronics.”
In addition, OCLI is in the process of replacing its older, power-corded binocular indirect ophthalmoscopes with rechargeable battery-powered, cordless ones. “This isn't primarily a space issue, but it definitely has a topological component,” Ruskin says. “Most of our doctors didn't realize just how annoying the cords were until they experienced what it was like to be free of them.”
OCLI recently tested two new indirects, the Video Omega 2C (Heine USA) and the Vantage Plus LED Digital Wireless (Keeler Instruments). According to Daniel Kiernan, MD, the lack of cords improves the efficiency of the exam and also the efficiency of patient throughput. “Wireless indirects can be mounted at a convenient location in every lane, i.e., an arm's length from the control panel of the patient's chair,” he said. “This facilitates extended ophthalmoscopy with or without changing the patient's position for scleral depression. Each wall charger also charges a spare battery. Furthermore, if there is only one indirect, it can easily be carried from lane to lane.” Dr. Kiernan says the lighting systems in both models the practice tested improve posterior segment visualization compared with older incandescent systems. “We found both designs to be more ergonomic than older-generation indirect scopes, being much lighter and easier to adjust when in use,” he adds. “Also, each has a teaching frame that can be flipped down for students to view, and each can be synched with a screencapture program on a laptop.”
Taking advantage of portability also figures into OCLI's management of space, while saving capital expenditure as well. Doctors transport a Selecta II (Lumenis) between offices for performing selective laser trabeculoplasty (SLT). Designed to be portable, the Selecta II clips onto a slit lamp at each location. “SLT is a procedure usually scheduled in advance, so we often keep the unit for a week at a time in certain offices,” Burke says.
OPD-Scan III by Marco
More Functions, More Benefits
Explaining one of his key considerations when acquiring new diagnostic technologies, Farrell C. Tyson II, MD, FACS, says, “In some markets, space can be just as expensive as the equipment. Therefore, it makes sense to purchase multifunctional devices.”
For example, in his practice, Cape Coral Eye Center in Florida, he uses the OPD-Scan III (Marco). This refractive power/corneal analyzer performs a long list of functions, including autorefraction, wavefront aberrometry, corneal topography, light/dark pupillometry and toric IOL planning. It not only makes good use of space but also fosters smooth patient flow and is more cost-effective than purchasing several separate instruments. “It only takes about 60 seconds to obtain a large amount of diagnostic information,” Dr. Tyson says. “I can take patients to this one machine and do not have to move them from one machine to another or from one room to another. Therefore, it also saves staff time and patient encounter time.”
RTVue from Optovue
Dr. Tyson derives the same benefits from using the RTVue (Optovue Inc.), which is also several technologies in one instrument, including anterior and posterior segment OCT, central corneal power calculation for IOL formulas, pachymetry and tools for glaucoma and retinal disease management. He notes an additional benefit of multifunctional instruments: “just one service contract.” ■
To download a PDF of the 2012 Diagnostic Instrument Buying Guide for Product Listings and Detailed Listings of Key Diagnostic Instruments, click here.