1. You’ve Decided to Bring Imaging Service In-House: Where do you Start? Patrick K. Lynch CBET, CCE, CPHIMS, HIT Pro/PW Global Medical Imaging

2. Think of every item of equipment as a sponge. The size of the sponge represents the cost of the item.

3. The entire Hospital...

4. Your world in Imaging...

5. The amount of water the sponge holds represents the annual cost of maintaining the item.

6. Our job: Squeeze the excess water (dollars) out of the sponges.

7. Phenomenom Annual cost of service is proportional to the purchase price Amazingly consistent throughout the economy Look at Extended Warranties for Office Products (Best Buy, Office Depot, etc.) 2 nd year warranty = 10% to 25% of purchase price The same with Medical Devices.

8. In Medical, it is called Cost of Service Ratio It works for: a single item or a group of items.

9. Cost Profile for Various Imaging Service Scenarios Type of Service % of Price per $1M FFS – OEM (unmonitored)12% - 20%$130,000 Contracts – OEM12% - 15%$120,000 FFS – OEM (monitored) 9% - 12%$ 90,000 Contract (3 rd Party) 8% - 10%$ 80,000 FFS (3 rd Party) 6% - 12%$ 60,000 InHouse 4% - 8%$ 40,000 9

10. Here’s an Exercise...

12. A typical scenario...

13. If Biomed did not exist...

14. If Biomed did EVERYTHING...

15. To Save Money: Move as many sponges as possible as far to the RIGHT as possible.

17. Step 1 – Think about ALL of your modalities

18. Step 2 - Where are you in the service of each modality? Warranty? Manufacturer Service Contracts? 3 rd Party Contracts? Insurance-type products? In-House? Multi-Vendor Agreements? Time and Materials?

19. Step 3 - Why do you want to change the present service? Savings for the hospital? I hate those *#!&$% manufacturers. I am having service issues with my present provider. Upward career path (and $$$) for me.

20. Where do you want to go with each modality? Keep it as it is now. Let a vendor do the work, I’ll manage the vendor. We’ll do PMs. Let a vendor do repairs. First response and fix 60% of all calls. Seek out opportunities, go as far as possible. Become totally in-house (95 of all work).

21. How to determine if you have a shot at an in-house program..... Where in the organization do you report? If Biomed reports to a plant engineer – not much chance. If Biomed reports to a Vice- President or higher, chances are good. Evaluating an existing Biomed department

22. How to determine if you have a shot at an inhouse program..... Do you know the managers of the various sections of Radiology? If they don’t know you, they are going to be reluctant to trust you with their service.

23. How to determine if you have a shot at an inhouse program..... Do you currently service any Imaging Equipment? Chances are better if you already have some interaction with Imaging. You know vendors, equipment, etc. You know customer’s expectations. You know the service reps.

24. How to determine if you have a shot at an inhouse program..... How’s your track record with Administration? Do you deliver what you promise? Does Administration believe that you can be successful in this venture?

25. How to determine if you have a shot at an inhouse program..... How’s your reputation throughout the rest of the hospital? Do your current customers think you are EXCELLENT or just mediocre? Imaging is MUCH more intense than monitoring. Your game has to be 100%.

26. How to determine if you have a shot at an inhouse program..... Can you attract and retain highly technical employees? Since you’ll be spending large dollars on training, it is important to be able to keep good Imaging Engineers. BTW, does your hospital believe in lots of technical training?

27. Key Factors for Success: Communication Proven Track Record Access to Information Adequate Test Equipment Quick-on-the-trigger to call for outside help Administration’s Support Technical Expertise

28. Obstacles to Starting an Inhouse Program Human Resources Manufacturers (passwords, manuals and parts) Repair Engineers Training Imaging Managers Test Equipment Diagnostics / Software / Passwords Administration

29. How to Sell to Administration “Look how good we are in the rest of the hospital”

30. How to Sell to Administration “The risk of failure of this new program is low.”

31. How to Sell to Administration “We can actually decrease downtime by having on-site support.”

32. How to Sell to Administration “I have planned for every eventuality.” Escalation Plan Status Reports (email, SMS, phone) Communication Plan Multiple Failure Plan

33. How to Sell to Administration “We won’t hesitate to call in outside help if we should need it.”

34. How to Sell to Administration “I won’t embarrass you or let you down.”

35. How to Sell to Administration Let’s look at the tremendous savings to the organization.”

36. How to Sell to Imaging Department Managers Know their Business ◦ What are their metrics. ◦ What keeps them up at night. ◦ What stresses them. ◦ Know their vocabulary. ◦ What administration expects of them.

37. How to Sell to Department Managers Help them be more successful. ◦ Save Money. ◦ Keep their rooms up. ◦ Keep their doctors happy. ◦ Help them meet their budget by assuming the financial risks.

38. How to Sell to Department Managers Help them find more time. ◦ Clinical Engineering will be managing service, relieving them of staff responsibilities. ◦ Manage the PMs. ◦ Manage the Service Calls. ◦ Manage the bills and costs. ◦ Manage regulatory issues.

39. How to Sell to Department Managers “I have planned for every eventuality.” ◦ Escalation Plan ◦ Status Reports ◦ Communication Plan ◦ Multiple failure Plan

40. How to Sell to Department Managers I have a plan for communications. ◦ One phone call to report issues. ◦ A combination email/SMS/telephone/status board plan for status reports to Imaging.

41. How to Sell to Department Managers “We have a track record.” ◦ “We have been doing this for the rest of the hospital, we are just extending our services to Imaging.”

42. Problems you WILL Have.... Manufacturers ◦ will tell customers they will be PUSHED TO THE BOTTOM OF THE LIST when requesting service if they don’t have a contract.

43. Problems you WILL Have.... Old Vendors ◦ will talk bad about you.  You do poor PMs.  You can’t do upgrades.  You don’t have any backup.  You don’t have the knowledge of experience.

44. Problems you WILL Have.... Diagnostic Software ◦ Even if you lease it from the manufacturer, it will be disabled every time they touch a machine.

45. Problems you WILL Have.... Error Codes If you can’t decipher them, the manufacturer will be glad to do it...... for a fee.

46. Problems you WILL Have.... Rad techs on Weekends ◦ will call the number on the sticker placed there by the manufacturer.

47. Problems you WILL Have.... General BMETs ◦ Will be angry because Imaging Engineers earn more money than them.

48. Problems you WILL Have.... Doctors ◦ Some will resent moving away from their favorite manufacturers for service.

49. Problems you WILL Have.... Dial-in or VPN by Manufacturers ◦ Manufacturers will make changes without telling anyone, often disabling diagnostic software.

50. Problems you WILL Have.... Service Literature and Software ◦ Will mysteriously disappear. Replacement manuals will be either unavailable, very expensive, or incomplete.

51. Problems you WILL Have.... Department Managers Some won’t like the loss of control.

52. Problems you WILL Have.... Perception Manufacturers nurture the perception that they offer “Cadillac Service” and that in-house service is just a poor, cheap substitute. Reality: In-house service is often better equipped, more knowledgeable and quicker to respond than the manufacturer.

53. Where to find technical people Manufacturers Hire the service engineers that you (and the customers) like. They are already trained. They know your equipment. They ease the transition away from the manufacturer.

54. Where to find technical people Grow your own. Does not work for the first person in Imaging Service. You need an experienced heavy hitter. Good Career path for BMETs. Must make sure job grades match up.

55. Where to find technical people Military There are a number of good engineers retiring from the military.

56. Where to find technical people Recruiters Jenifer Brown Doug Stephens

57. Where to find technical people Personal Network of contacts and associates Local area National meetings State association Training entities ◦ DITEC ◦ RSTI

58. Where to find technical people Listservs and the Internet TechNation BiomedTalk ImageTalk Monster

59. Where to find technical people Associations AAMI Local Association

60. Costs of an Inhouse Program Salary and Overtime (10% to 15%) Test Equipment On-Call Costs Diagnostic Software Technical Training Contracts (you’ll always have some) Manufacturer Support (5% to 40% of calls)

61. Savings from an In-house Program Reduced or no Travel Time Increased Uptime from onsite personnel & parts Savings on X-ray Tubes No premium rate for after-hours PMs Ability to use second source Parts Ability to use alternate (and cheaper) service providers Ready access to dedicated engineers

62. Where do I start? Start with what you know. Develop a COMPLETE inventory. Get copies of ALL contracts. Get financial control of all service. Collect service information. Begin talking with potential service engineers. Pick the low hanging fruit (easy to service or problematic current service).

63. Preapproval preparations Inventory all items. Financial Control of all service. Copies of all contracts. Join AHRA Get any training you can. Join ImageTalk.

64. Preapproval Preparations Know alternate providers of service, parts, tube, training, support. Begin regular meeting with Imaging Supervisors. Start conversations with potential employees. Develop job descriptions and pay grades with HR. Learn about the Radiology Business – the player, the money, the issues, etc.

65. What if I don’t get permission? Don’t give up – it will happen sooner or later. ◦ Money will get tighter. ◦ Their favorite service engineer will retire. ◦ The company will be bought. ◦ Service will deteriorate.

66. You will get the business if you are prepared with the correct: ◦ Reputation ◦ Information Resources ◦ Financial Resources ◦ Communications Skills ◦ Knowledge ◦ Test Equipment ◦ Attitude.

67. Takeaways: Prepare thoroughly. Be committed for the long haul. Persist. Find a high-powered technical expert in imaging service. Nurture your relationships with Imaging leadership.

68. Questions and discussion plynch@gmi3.complynch@gmi3.com (704)941-0116