Cost Management in Radiology

How many slices or high a Tesla do radiologists need?

At this year’s HMS, André Hoppen, MD MSc, Sales Manager for VR MEDICO, Germany, looked at the most important decision-making criteria from the perspective of a financial services provider. “Finding out whether a new MRI or CT scanner will pay off is only possible by asking specific questions”, he said.

André Hoppen, Medico Leasing GmbH (credit: photonews.at/Georges Schneider)
André Hoppen, Medico Leasing GmbH (credit: photonews.at/Georges Schneider)

 How to finance medical technology is one of the crucial issues hospital managers regularly face. Patients expect to be treated with the state-of-the-art technology, but the costs for the most innovative equipment may be prohibitive. Radiologists tend to base the investment decision on the number of slices or Tesla required.

As a financial services provider VR Medico calculates profit forecasts for customers contemplating an investment and then offers suitable leasing contracts to finance those acquisitions. However, there is no standard formula, Hoppen explains: “We always ask the same questions, but we never get the same answers.”

Key questions:

- For how long has the radiologist been working on a self-employed basis?

- Who or which medical faculties will refer patients to the department or institute?

- Which medical experience does the institute or department have?

- What is the speciality of the medical center, e.g. neuroradiology, cardiology? Does the engine suit this speciality?

- Which commercial and financial experience does the head of the institute have?

- What is going on in the neighbourhood?

- Which technical equipment does the competitor have?

- How long does the radiologist want to use the equipment?

The analysis of patient structures is particularly important, Hoppen pointed out. Calculating the mere number of patients likely to be examined with the new equipment is not sufficient when assessing the cost-effectiveness of an MRI or CT scanner.

The six or even seven digit amount on the price tag for high-end equipment is not the only costs that have to be taken into account. Unlike conventional X-ray equipment, large modern scanners incur considerable follow-up costs. “For example 3-Tesla installations carry additional costs of around €100,000 to €150,000 due to the electricity and air conditioning technology that needs to be acquired and installed. In addition, maintenance costs can be high. With MRI installations, it is particularly important to take out full service contracts. They are also recommended for CT scanners to ensure they maintain their value. The manufacturers’ original service commitments are becoming increasingly important.”

Hoppen’s advice: “I recommend a 16-slice CT scanner as the basis of modern equipment because it can address about 90% of radiology problems. A 16-slice scanner will incur costs of around €1.4 million over an eight-year period, including staff costs for a medical imaging technician as well as updates and electricity, but excluding the radiologists’ fees. MRI scanners incur similar costs. In my view a 1.5 Tesla machine should be the basic, standard equipment. However, how many slices you finally want to invest in remains the radiologists’ decision. As long as there is sufficient patient potential to make the equipment work economically, we will support your plans.”

Hoppen is responsible for the sale of leasing products to clients of cooperative banks and to distributors and manufacturers who are direct clients, and focuses on the development of financing solutions in cooperation with banks, distributors and manufacturers.

12.04.2010

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