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NEWS: We can work it out, by David Rolfe, Managing Director of Asteral, looks at a new model for healthcare sales: the Managed Equipment Service.
Asteral Managed Equipment Services aim to develop a 'joined-up' approach looking after every aspect of your clinical equipment needs allowing you to focus on high quality patient care and achieving national targets.
Vendor independence
Asteral is unique in the UK MES marketplace in that it is has vendor independence status. This means we do not have any particular alliance with manufacturers or suppliers of medical equipment.
This approach enables us to offer impartial advice and clinical choice across all equipment suppliers, matching your needs to the best technology solution. We believe this delivers the best value MES in the marketplace.
The benefits of Asteral's MES are numerous to NHS Trusts, hospital management, departmental staff and patients. It delivers financial gains, an increased standard of care and operational efficiencies.
From a financial perspective it offers a stable, planned long-term strategy, moving capital equipment off the balance sheet and transferring risk away from the NHS. Procurement, maintenance, training and ongoing costs are cut by working in partnership with a specialised company. This in turn helps to achieve operational targets.
The installation of innovative medical equipment such as direct digital imaging systems readily improves the daily role of staff, making their life easier and positively improving morale. The replacement of ageing technology revolutionises the running of departments making examinations swifter and providing results more quickly. Ongoing user training and close management of maintenance through a MES also ensures the maximum uptime of equipment.
All these benefits impact on the patient. Lower waiting times, less re-scheduled appointments, swifter examinations and less anxiety associated with the care process.
MES Benefits
A Managed Equipment Service delivers considerable efficiency, process and financial benefits to the NHS:
An improved standard of care
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Safer, modern equipment replacing ageing technology
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Higher patient throughput
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Shorter waiting times for patients
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Improved environment for patients & staff
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Ongoing training of NHS staff
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Process efficiencies
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Needs analysis at the outset ensures the best equipment solution is implemented
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Reduced equipment downtime
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Ongoing planning, monitoring & review of performance & standards
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A 24/7 equipment call centre
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Guaranteed upgrades and installation of the latest clinically appropriate equipment
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Financial gains
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Capital equipment is 'off-balance sheet'
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Capital charges are eliminated in favour of a stable long-term planned budget
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The sale of legacy assets releases cash immediately
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Reduced procurement costs
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A VAT recoverable service (subject to HMRC approval)
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Reduced CNST costs
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Increased productivity = reduced cost per patient
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A MES ensures a stable and long-term approach, allowing planned sustainable budgeting.
Fluctuating budgets are eliminated in favour of pre-agreed fixed costs. A MES includes staff training and maintenance.
Assets are moved off balance sheet, capital charges are no longer required, and profit can be realised from the sale of legacy assets.
VAT may be recoverable on an a MES depending on the exact level of services provided.
Asteral's MES operates in accordance with all the industry's relevant statutory regulations and guidelines.
We also employ a specialised team of experienced and highly qualified equipment and commercial experts. This ensures we offer you the very best level of consultancy and project management standards.
Asteral simplifies the procurement process saving you time, resources and money.
We deliver a 'joined-up' approach to procurement, maintenance and support. This ensures that at any one point in time, we have the whole picture in mind and a long-term plan at work.
Asteral's MES ensures that ongoing training of staff is a priority. The biggest cause of equipment downtime is user error; Asteral works with Trust staff to radically reduce this.
Unlike many OEM equipment installations where user training is a 'one-off' session, we understand that with high staff turnover and the regular use of locums, ongoing training is a necessity.
Without such an approach, equipment is vulnerable to downtime through user errors and poses potentially dangerous clinical risks.
Asteral provides a coherent strategy towards equipment maintenance. A full audit trail of maintenance activities is kept. Monitoring and managing maintenance activity delivers a significant improvement in service.
Without such a strategy, third party maintenance providers or in house engineering teams are rarely monitored and equipment downtime rates are generally vague. The consequences in terms of additional cost, delays to patient care and lost clinical productivity are unknown.
We employ a specialised team of experienced and highly qualified equipment experts including state registered clinical scientists, a radiographer with proven skills in teaching and training, a radiation protection advisor and a pathologist. This technical industry knowledge combines with commercial expertise in risk management, project finance and auditing.
Asteral delivers a return on investment through cost reductions and process efficiencies.
Financial gains are made throughout the lifetime of an MES contract. Procurement, training and maintenance costs are rationalised delivering auditable results. Our specialist team negotiates new equipment costs, installation is undertaken with minimal disruption and equipment uptime is maximised.
New and innovative medical technology also ensures swifter patient throughput and a reduced cost per patient. As the equipment works faster, fewer units are required and thus fewer staff.
Payment by Results (PbR) offers major opportunities to Trusts but it also carries major risks if not managed well.
Working in partnership with Asteral delivers efficiencies. Modern technology increases patient throughput, reducing average cost per patient. This is essential for NHS Trusts seeking to keep costs below tariff.
The shift to a well managed MES, coupled with process review and process re-engineering can be the catalyst leading to wider service reform.
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Business leader: David Rolfe on managed equipment services
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09 December 2006
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At a time when the NHS is under considerable financial pressure, managed equipment services can help make the best use out of modern technology – David Rolfe.
By David Rolfe, managing director of Asteral (Published by Wilmington Media Ltd.)
The NHS is under increasing financial pressure to perform, deliver results and reduce costs. It is therefore starting to embrace ideas from the commercial world and adopt innovation like never before.
The pressures on the NHS are likely to grow over the next few years. As Payment by Results (PbR) and independent sector competition is phased in, the need for trusts to keep costs below tariff is becoming more and more important.
One route to achieving operational and financial success is the outsourcing of all aspects of medical equipment to a third party specialist though a managed equipment service (MES) agreement. This is a joined-up strategic approach to all elements of equipment management, procurement and maintenance. This concept helps NHS trusts fully exploit modern technologies and reduce equipment downtime. As a result, productivity is increased and financial savings are gained.
MES agreements combine many components of long-term investment planning, including user training, expert safety management, equipment replacement and renewal and performance reporting. Typically, over 15 to 20 years an MES contract transfers significant risk and management workload away from a trust and provides guaranteed availability of essential modern technology.
The Wanless review stated: “The NHS is a late adopter of technology, especially big ticket items.” More recently, the House of Commons Select Committee and others have confirmed that the UK needs to invest in MRI, CT and other medical technologies, where we are well behind other rich countries. MES agreements provide an efficient cost-effective option for the NHS to invest in the technology that is needed.
Much of the medical equipment that the NHS does have is ‘sweated’ beyond its economic life. The Audit Commission (2003) Report on operating theatres found that “50% of theatre equipment has passed its agreed replacement age in one in four theatres”. MES agreements provide a sustainable long-term investment programme with pre-agreed equipment lifecycles that will avoid this situation in the future.
With a strategic approach to managing equipment, which ensures that medical equipment is maintained to a high standard and is replaced to an agreed investment plan, patients and clinicians always have access to the highest standard of equipment. This reduces clinical risk and increases productivity. With an MES contract in place, the availability of medical equipment will not be an issue.
The specialist providers in this field excel in clinical and commercial skills. Indeed, a new breed of provider offers a particularly high level of value. A ‘vendor independent’ MES provider does not manufacture equipment and thus has no incentive to promote one set of equipment over another. Since it is not allied to any manufacturer or supplier this enables it to offer impartial advice and the widest clinical and medical equipment choice. This puts the independent vendor in a strong position to manage the procurement, delivery and the quality of service provided by original equipment manufacturers (OEMs), not least in matching the clinical requirements of a trust to the optimum technology solution available in the market.
So, how does one get the MES ball rolling? The first step should be to fully understand MES. Enter dialogue with a number of potential providers, read industry white papers and visit trusts that already have a MES in place in order to form a better view of the type of service possible.
The next step is to prepare for procurement. Engage stakeholders in the process, communicating the rationale for using an MES to deliver the equipment services that the trust requires. This might include members of the trust board, clinicians and specific departmental staff. It may also be of benefit to employ specialist advisers to assist with the procurement.
Ensuring trust equipment inventories are accurate and up to date is best addressed early in the procurement planning stages. This can often be the bottleneck in the MES process so prior preparation really helps.
A strong business case will be needed, quantifying accurately the direct and indirect, real and hidden costs of the current arrangements, what risks currently lie with the trust and what the cost of these is. Effectively this is building a ‘public sector comparator’ (PSC). The operational and financial benefits of MES tenders should show an improvement against the PSC.
Finally, an Official Journal of the European Union (OJEU) ‘Invitation To Tender’ should be produced. This will provide details of all equipment to be included, the services to be provided and the service improvements that the MES is expected to deliver. The length of the procurement process depends on the urgency and level of resource a trust can commit to working through all the relevant matters. Typically it will take six to 12 months.
Once in place MES takes care of all aspects of equipment management leaving the trust to do what it does best: patient care.
Asteral has produced a white paper to introduce, simplify and explain the MES concept. It is available from info@asteral.com or by calling (0118) 900 8100.
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