Just as your capital equipment budgets are tighter than ever, equipment vendors are feeling the squeeze, too. They've got equipment that they need to move. If it's true that there's never been a better time for you to negotiate a favorable deal, the key to doing so is leveraging certain factors in your favor.

1. Know what others have paid.
Buying medical equipment is like buying a used car. "Pricing by vendors is all over the map," says Larry Hampton, chief executive of HELP Equipment Planning in Plano, Texas. For example, video endoscopy equipment from some vendors is going for 50% of list price. For that reason, it's important to know how much other facilities are paying for equipment. "Knowledge is power," says Mr. Hampton. If you don't know real prices, the vendor is in the position to sell you something at the highest possible price.

Ask your peers how much they paid for certain equipment. Contact people in the trade associations that you belong to, especially members of local chapters.

Insider reports are another option. ECRI Institute's (www.ecri.org) SelectPlus equipment price reports contain technical and financial information on a broad range of medical equipment. The SelectPlus membership program costs about $19,500 for a standalone hospital. Pricing varies for smaller hospitals and those that are part of health systems or integrated delivery systems, says ECRI.

Another source of online benchmarking is MD Buyline (www.mdbuyline.com), a database of information on healthcare products. For non-members, the company offers free quote analysis on bids that you receive. You can keep submitting quotes until the MD Buyline analysts have identified savings equivalent to the cost of a year's membership. (Membership is based on facility size, beginning at $5,000 for office-based practices and $22,000 for hospitals.)

Web-based software provider Attainia (www.attainia.com) offers free access to its continuously updated Watch equipment catalog to members of the Premier, VHA and University HealthSystem Consortium group purchasing organizations and to MD Buyline subscribers. The Watch system contains templates for outfitting ORs and has constantly updated prices from several sources, including GPO contract prices. For $5,000 to $10,000, depending on size, facilities can subscribe to Attainia's budget software system, which lets users research equipment, create OR equipment templates, and plan and track equipment budgets for coming fiscal years. Finally, your GPO group's buy price is another good benchmark for you.

2. Get an opt-out.
What if certain surgeons leave, or your priorities or case mix shift, and you find that you don't need the equipment that you've negotiated for and ordered? To avoid having thousands of dollars of equipment collecting dust, make sure that you have a way to get out of the contract, even after the equipment arrives.

Get ready to do some convincing when you ask for an opt-out. "Every time I've done this, the rep balks," says Owen Owens, PhD, vice president of operations for Sovereign Healthcare in Scottsdale, Ariz. You might need to explain that you have a new surgeon and you want to ensure that it's a win-win situation for you and the vendor. Emphasize that you'd like to establish a long-term relationship in which you'll purchase the disposables for years to come.

Dr. Owens has succeeded with this strategy for GI towers, endo towers used in ortho cases and ablation power sources for gynecological procedures, all products that have accompanying disposables.

3. Shop online, cautiously.
You can find plenty of great deals on eBay, DOTmed.com and other sales sites. Start at Google's shopping section and enter the make and model that you're looking for. But before you buy, you have to do your homework. Confirm the integrity of the seller and verify the quality of the equipment that you buy. Look at the reviews and ratings that the seller has received and talk with other administrators who may have bought online already.

A few years ago, Michael Gossman, BSBA, CASC, administrator at Cedar Lake Surgery Center in Biloxi, Miss., outfitted an entire orthopedic OR shopping online. It took almost a week of research to find the ortho tower, video equipment, monitors, OR bed and other equipment. But it was worth it, says Mr. Gossman, who estimates that he saved about 25% on the purchases.

4. Control the bidding process.
Make sure the bidding process is on your terms. You can base the functional requirements on the technical specifications of a specific piece of equipment, even listing the model number, but be flexible enough so that other manufacturers can bid. To do this, say that a vendor's equipment must meet or exceed the specifications listed in the request for quote. Specify the deadline for a response (usually 2 or 3 weeks). "Mention the due date for bids and say that no bids will be considered after that date," says equipment planner Kevin Klasic, a principal at Shen Milsom & Wilke, based in Plymouth Meeting, Pa.

Keep the reps away from physicians and nurses who'll be using the equipment. "Otherwise, you'll lose your negotiating control," says Mr. Klasic. In your request, say that any vendor queries must go through the person at your facility gathering the bids. Disqualify any vendor who contacts your physicians or staff.

5. Bundle supplies into your purchase.
Turn a single purchase into a package deal that includes the instruments, disposables and maintenance for the equipment that you're buying. You may end up saving 5% to 25% on the equipment when you negotiate everything at the same time, says Dr. Owens. For example, if you're purchasing an endo tower, ask about adding scopes, shavers, burrs and a maintenance plan into the deal. Sometimes you can't craft a deal like this because the equipment manufacturer requires its customers to purchase the disposables through a GPO.

Regardless, make sure that you negotiate a multi-year maintenance plan before you buy the equipment. You'll get a better price than you would a year or two after you buy the device. "Once it breaks, you've lost your bargaining power," says Dr. Owens.

6. Buy the product, not the sales rep.
Regardless of your relationship with your local rep, base your decision on your needs, not those of the rep. Sales reps are paid on commission that can range from 1% to 20%, depending on the product.

"Their first obligation is to their employer," says Mr. Hampton. This means that you might have to say "no" to a friendly rep. But don't worry; in today's market, the rep will likely come back with a much better price. No matter what price your rep returns with, you still have to make sure that you buy the equipment that's best suited to your needs.

7. Hold a product fair.
Getting all your vendors into your facility the same day or week lets you and your surgeons do some hands-on, side-by-side shopping. A fair can help you deal with change-resistant physicians. "Product fairs make hard-line surgeons look at options," says Mr. Hampton.

For such OR products as stretchers or Mayo stands that don't need to be demoed, schedule a day in a hotel conference room, country club or other meeting venue where the vendors can present the benefits of their products. Invite as many vendors as possible. "The more vendors you have, the better the perceived competition," says Mr. Hampton.

For products that the surgeons will use during surgery, schedule weeklong trials, one after another. Create a questionnaire that surgeons can use to provide feedback. Once the trials are over, use the information you've gathered from the surgeons to create the specifications of your request for a quote.

8. Lease with a dollar buyout.
With these leases you have fixed monthly payments and, at the end of the term, either you own the equipment or you have the option of purchasing it for a fixed fee. "It's just like leasing a car," says Shirley Wright, MBA, CST, administrator at Memorial Care Surgical Center at Orange Coast in Fountain Valley, Calif. Sometimes the buyout price may be linked to your usage of disposables. This is especially true with phaco machines, otoscopy equipment and radio frequency refractive ablators for pain management procedures. If this is the case, make sure that you indeed have the volume that you stated during negotiations. Otherwise, you may end up paying more for your disposables or the right to own the equipment when the lease expires. "Be honest," says Ms. Wright. "If you falsify the volume, it will bite you in the end." It could end up costing you thousands of dollars.

9. Get at least 3 quotes.
This is a purchasing fundamental that many buyers just don't take the time to follow, says Mr. Gossman. When you're asking for quotes, stay ethical and don't show a competitor's quote to another bidder. "Keep it sealed," he says. It's not fair, and word will get out among the reps that you don't play fair. In the long run, you may miss out on good prices in the future.