In a highly competitive healthcare industry, organizations and facilities continually search for creative ways to lower their operating costs.

According to Modern Healthcare, some of the biggest expenses include healthcare technologies and medical device acquisition costs. Hospitals spend roughly $93 billion per year on medical equipment life-cycle costs, including personnel costs and technology implementation.

 As healthcare technology investments continue to rise, understanding how to calculate the total cost of ownership is crucial for making smarter healthcare investments today. Learn from Remi, your trusted partner in managed service agreements.

Managing the Total Cost of Ownership (TCO) of equipment can positively impact the bottom line and assist a facility in turning profits. The total cost of ownership includes direct and indirect costs, along with calculating downtime costs and time healthcare providers spend on operations due to hidden costs.  

Every healthcare technology decision involves weighing both the environmental and social costs. This blog will explore the five key components when determining the TCO for your healthcare organization’s specific healthcare technology and medical device disposables.

  1. Acquisition – Acquisition costs cover project management, from the start of researching the product to the costs related to purchase orders, delivery, setup, and final clean-up. Initial acquisition expenses, such as those for management and additional staffing costs, can increase dramatically when factoring in the specialized needs of technology investments. For example, reviewing vendor contracts for lab or radiology software or even ensuring data protection compliance for sensitive patient data. Healthcare organizations should consider the overall acquisition costs when evaluating equipment purchases, such as an unexpected data migration cost, and providing the investment planning process is well-structured and comprehensive. Moreover, initial acquisitions may involve hidden or unexpected costs, such as telecom platform TCO changes or substantial budget overruns.
  2. Operation – The TCO healthcare calculation for operational costs includes initial and recurring expenses for power, labor, and management efforts that come with training healthcare professionals. Hospitals must also consider how operational and downtime costs affect their existing clinical workflows, and data compliance. These costs will increase over time due to rising labor expenses, but focusing on cost forecasting helps healthcare institutions ensure smarter resource allocation. Additionally, healthcare technology involves the risk of unexpected data migration costs, which can disrupt clinical operations if precautions aren’t in place.
  3. Maintenance – Ongoing costs kick in as healthcare equipment requires regular maintenance. The annual spending to maintain medical equipment is about 1% of a hospital’s total annual budget. Remi can help healthcare enterprises uncover significant hidden expenses and reduce their total cost of ownership with a specialized managed service agreement. Efficient healthcare solutions must account for the technology’s financial performance and economic impact within the broader TCO healthcare framework.

With Remi, you get the following benefits:

  • Consolidation. Multiple equipment maintenance agreements are consolidated into a simplified plan, allowing you to allocate resources strategically. This is designed to ease operational cost forecasting and reduce disruptions to clinical workflows.
  • Savings. With Remi, healthcare organizations can save around 20% vs traditional maintenance costs, delivering hard cost savings and avoiding significant hidden costs.
  • Budgeting. Annual budgeting becomes easier, supporting long-term technology investment planning through logical allocation of operational costs. Remi helps organizations highlight hidden costs while ensuring updated TCO healthcare calculations are included in financial projections.
  • Customer Support. Remi’s customer-centric partnership means 9 out of 10 customers consistently choose us for more efficient service and agree they had a positive experience with healthcare equipment maintenance.

Next week, we will discuss consumable spending and extending the life of equipment.  Subscribe to receive notifications about new blog posts and stay updated on healthcare technology decisions and specific financial performance!

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