Monday, January 11, 2016

Personal Attachment: 10 Minutes of Unlicensed Therapy

Who’s got attachment issues? It’s remarkable to what extremes people go to hang on to their dated belongings. The “I cannot let this go” phenomenon clutters our homes, our minds and certainly generates a few dollars for Hollywood when shows like Hoarders has viewers glued to the screens with mouths wide open.
It’s almost endearing to have a collection of sorts. And trust me, I know as my “good luck charms” paraphernalia is starting to overpopulate the shelf it calls home. 
 
However, for those of you working in a medical setting and exhibiting profound attachment to underused medical devices and supplies, this type of behavior can be filed under an "expensive and unrewarding" hobby.    
 
You see, unlike personal collections that may increase in value or be resold directly to other collectors, auctioned off (watch out for those fees!) or brought to consignment stores, medical devices simply depreciate in value and eventually become almost worthless.
 
This was a tough lesson recently learned by two Chicago area physicians who decided to retire and sell all the assets from their private practice. They were proud of their established, 20 year old clinic that was heavily stocked with barely used medical equipment, supplies and furniture.  They had no doubts that buyers will be lined up outside their door ready to pay premium for well-maintained products.  
 
Among items that ranged in age from few months to 20 years, were two “once-upon-a-time” very valuable and expensive diagnostic devices. Both devices were purchased at a sticker price, directly from OEM nine years ago.  
 
Sadly, for various reasons, both devices were completely under-utilized and sat around practically untouched throughout most of their longevity. Truth is, physicians should have sold them years ago when reimbursement rates for procedures performed on these devices were more rewarding and equipment was still young.  
 
But, they didn’t sell them, or any of their other acquisitions.  On the contrary, even though physicians seldom used the equipment, they rented storage space and paid a local service company to have it preventatively checked and regularly cleaned. They kept all of the original boxes, purchasing agreements, technical spec brochures and sales rep’s business cards.
 
They were hoping their amassed collection and due diligence will pay off and they will be able to sell all equipment by discounting it 25% from original purchase price. What, really?
 
As good and lucrative as this plan sounds, here’s why it’s not realistic:
  1. Technology evolved and these devices are missing standard options desired by today’s market
  2. Software is now outdated and considering the age of equipment is not worth the upgrade
  3. Some of the devices are no longer supported by their manufacturers
  4. Some of the supplies used with these devices are no longer being manufactured
  5. End-users such as medical facilities will not purchase equipment without at least a 90 day warranty and do not want to pay any associated de-installation fees
  6. Dealers/Refurbishing Companies are looking for bargains and despite working condition & good cosmetics, they still have costs associated with refurbishing process and warranty
The two physicians learned an expensive and eye-opening lesson. Not only did the recent volatility of the stock market negatively impacted their IRAs, their overall retirement portfolio dropped by more than $24,000 due to poor planning, inherent industry misconception and weak market demand for complex and dated medical equipment.
 
So how can you help your facility from getting caught in same situation? Simple, if you know of any device not being utilized, advocate to sell it! The longer it sits around and collects dust, the less rewarding will be its’ decommission.  
 
Unless devices used in your facility are entirely made of gold, they will not increase in value with age. And if they are made of gold, please snap a selfie standing next to one of them and send it to me. I will frame and add it to my collection of “good luck charms”!
 
 
If you would like to learn more about the benefits of centrally managed, in-house Medical Equipment Decommission Program, please visit www.ecomedhtm.com.