A little over a decade ago, Baptist Health in Florida was planning the opening of a new medical center, heart hospital, and full service breast cancer center but wanted to find a strategic way to control capital costs at the new facility for the influx of new medical equipment without compromising the quality of patient care.
That’s when Baptist devised a more efficient way to plan and manage their medical devices and share risk.
According to Marianne Hillegass, senior vice president and chief resource officer at Baptist Health, the health system partnered with GE Healthcare to introduce real-time data and analytics to help their system make informed decisions about whether and when devices need to upgraded, fixed or replaced, as well as the size and makeup of each department’s equipment budget.
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Over the last 11 years Baptist Health has grown in size to a five-hospital healthcare system, but they were still able to reduce the overall maintenance and service costs more than $7 million as a result of the program. As a bonus, equipment uptime has risen 99 percent, Hillegass said.
“What started out originally as a transactional discount for clinical equipment quickly evolved into a full service agreement,” said Hillegass. “It’s been the best thing we’ve ever done and never looked back. It was a risk but we were taking it and moving in the direction of having more knowledge and documentation of all the services we have. We use that information to develop our capital planning, and we keep re-setting our bar every few years.”
John McCarthy, general manager of asset management at GE Healthcare, said GE and Baptist worked out a collaborative model in which both organizations have a hand in helping one another succeed.
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“We took risks to bring down costs initially on the Baptist side,” he explained. “We partner with Baptist outside of simply fixing equipment. We collaborate around capital planning by driving process improvements and financial results.”
McCarthy also explained that GE works with Baptist to have an annual technology planning assessment to guide informed equipment lifecycle decisions about when to fix, upgrade, or replace particular devices, as well as the use of a tool called iCenter to study device utilization and service reporting in real time.
“We keep track so Baptist knows when it’s time to replace equipment before costs go up on the service side. So they get as much use out of the device as possible but not so it starts costing more to keep it running,” he said.
Hillegass said she has not heard of many health systems utilizing a program like Baptist’s, which is likely due to budgetary restraints.
“Directors are nervous about the budgeting. When you do one-time services on equipment, you know what your costs are. With a program like this, you might spend more upfront, but your overall costs over time are much lower. You have to be willing to go with the ups and downs,” she said.
McCarthy warned that in order for a health system to be successful utilizing a risk-based agreement like the one GE and Baptist have, they need to have capital planning tools to manage event and utilization reporting.
“With reporting tools you are flying with a cockpit rather than just flying blind,” he said. “With the changing industry everyone is looking at ways to save costs and improve patient safety. This can be done with a collaboration between a hospital and vendor – this creates flexibility and new ways to do business.”
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