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How to Get the Most for Your Money When Buying Refurbished Equipment
Facility managers share their experiences with the secondhand market.
Nathan Hall
Publish Date: March 17, 2008

When it comes to refurbished equipment, you're likely to hear one of two opinions from facility managers: either it's a great way to save money on capital expenses, or it's a gamble where you could lose big. Here are tips on how to minimize your risk while getting the most out of the refurbished market.

Get to know your vendor
You obviously want to research vendors to be sure they're on the level. But even a clean reference check isn't a guarantee against a dirty deal. A former facility manager, who didn't want to be named, says that she checked the reputation and called the references for a vendor who was selling an ophthalmic microscope. "The price was right and it was supposed to have everything that we needed, such as an observer lens and bipolar cautery," she says.

When the scope was delivered, she had a check ready as per the vendor's request. She was told the microscope would have a 90-day warranty. "My lead ophthalmology nurse set it up in one of the eye rooms, but nothing worked as promised," she says. "We called and called and called. Finally, the person who sold it came out to fix the problems."

At this visit, the manager found out that the vendor had retrofitted everything, so the microscope was basically junk. "He offered to swap it out, and he took the microscope, but we never heard from him again," she says. "We took him to court, but he had filed for bankruptcy, so we got nothing."

When administrator Nan Hall, RN, equipped the Pasadena Surgery Center in St. Petersburg, Fla., last July, she started with a vendor she knew back when she worked for another facility. Although she trusted him and his company had a great reputation in the community, she asked to evaluate the equipment before agreeing to any purchases.

"I actually went to their offices and showroom and looked at their equipment," says Ms. Hall. Because of this visit, she says she found that most of the refurbished equipment looked and worked like it was brand new. She purchased two OR beds, a blanket warmer, anesthesia machines, OR lights, an EKG machine and ancillary equipment such as stools and IV poles for 40 to 60 percent of what these would cost new.

That came out to several thousands of dollars in savings for each item, says Ms. Hall. Her vendor calculates the average savings at $40,000 to $50,000 for a project such as hers. Ms. Hall saved big on her anesthesia machines, paying about $12,000 for a refurbished model that costs $25,000 new.

After an outside source recalibrated the machine, Ms. Hall presented the vendor with a list of minor adjustments that had to be made. "They took care of everything," she says. "They were very efficient."

Find the right company for you
For years, Vickie Arnold, RN, clinical director of the Roanoke Valley Center for Sight in Salem, Va., did business with one of the larger companies in the refurbished medical equipment market. While it had all the equipment she wanted, she said that sometimes it was hard to schedule repairs. While attending an ophthalmology meeting, she struck up a conversation with someone representing a smaller company that was in her area. She decided to give them a chance.

"They were more personable, they answered our questions, and if there was something they didn't know, they would e-mail the information back to us or call," says Ms. Arnold, who has purchased stretchers and monitors from the new vendor.

Doug Martin, RN, MBA, director of clinical operations for Fort Wayne Cardiology in Fort Wayne, Ind., managed to find the right vendor on the first try. He says that he saved thousands on his EKGs, monitors and defibrillators over the past three years and plans to purchase more refurbished defibrillators and crash carts in the coming year.

"[Our vendor] has always been reliable," says Mr. Martin. "We had a situation where our EKG machines weren't working, and she took them back with no questions asked and got us new ones."

Although Mr. Martin says he's so happy with his vendor that he recommends the company to other administrators, he says he still compares her prices to other vendors to be sure he's getting the best deal. "She usually comes close or beats the rest of the prices," he says. "If she comes close, we stick with her for her service."

At Garrett County Memorial Hospital in Oakland, Md., nurse manager for surgical services Joann Forno, RNFA, MPM, CNOR, says she is very happy with having one of the best-known names in medical equipment as her vendor for refurbished equipment. "We've dealt with them for many years, and the experience has been good," she says. "Their equipment has performed very well for us."

Recently Ms. Forno purchased two sterilizers: one that lists for about $80,000, which she purchased for $53,000, and another listing at about $35,000 to $40,000 for $24,000. When obtaining quotes for purchases, she finds out the price of buying the equipment new as well as refurbished. That way, she can discuss with her facility's vice president which would be the better option and show the potential savings.

Exactly what you want
In addition to getting to know the vendors, be clear about the type of equipment you need. Since Ms. Arnold's facility specializes in ophthalmology, she had to show her vendor's representative the specific equipment she needed for her case mix.

"Sometimes we'd ask the rep for some specialized equipment, and he'd have no clue what we were talking about," she says. "We needed an ophthalmology stretcher, so we had to make him understand the need for the brakes, the mattress and the headpiece. There was a bit of a learning curve because he was used to regular stretchers."

To get her rep on the same page, Ms. Arnold says she e-mailed him some Web links and pictures of the type of equipment she wanted. "It turned out that some of the terms the rep was using weren't the same as our terms, but the merchandise was the same," she says. "They e-mailed us pictures of the equipment they were refurbishing. It was very nice to be able to see exactly what we were getting."

Even though Ms. Hall says her facility saved thousands, she says she had more than money in mind when she considered the equipment. "We never compromised when it came to feeling comfortable about a purchase, so we got everything in top quality," she says. "It was extremely important that we had equipment that was safe for our patients and that functioned properly."

While the initial investment may be lower, you'd be advised to set aside some money for repairs. Ms. Arnold says some of the refurbished equipment she got for her ORs did not last long before it needed to be serviced. "When that happened, we found out that some of the mechanisms in them weren't refurbished," she says.

To get the most for your money, you need to be sure that you're getting the most recent product available, says Ms. Forno. "You need to look at the latest technology on the market and be sure the refurbished equipment is at the same level as the new options," she says. "If it's not the same technology, I would hesitate before buying it in some instances."

Buying more recently made equipment can also help to ensure that maintenance won't be a problem in the future, says Ms. Arnold. "Sometimes when you get something that's not the newest thing out there, you'll find there aren't parts available for it anymore," she says.