Demand for endoscopic video systems is expected to grow as new techniques enable even more procedures to be performed in a minimally invasive manner. This will make the question for today’s hospital not if to purchase a system, but how many to purchase.
Today’s market is diverse, sub-divided into gastrointestinal (GI) and surgical markets with a smaller market emerging for endoscopic ultrasound. The GI market has become one of the largest endoscopy segments as a result of increased awareness and screening for colorectal cancer and other GI-related conditions. While surgical scopes have a separate camera head and adapter that allow them to be used across vendors, GI scopes have a camera head built in, which ties it to a single vendor’s scope.
Listed in the chart below are price ranges seen for GI and surgical systems as well as full-service contracts for both of these systems. Lower prices are for the smaller standard definition video systems often used in doctor’s offices, while the higher priced systems are for high-definition systems used in operating rooms. To be competitive in today’s environment, many hospitals are offering systems in high definition. Other improvements in this area include digital image capture and 3D visualization.
Cost reductions can be found in considering demo units, which vendors typically will provide with a normal one year warranty. Another option is to consider previous generation technology. Used systems may be an option for facilities that do not have the funds to invest in an HD system or for smaller facilities that do not have the volume to warrant a new system purchase. The feasibility of this option will depend on the primary surgical application. Ultimately, the right system will depend on hospital size, the budget and types of procedures for which the system will be used.
Electronic equipment such as monitors, video processors, insufflators, printers and light sources are typically reliable and have a low failure rate. For this reason, they are not typically cost effective to service under a service contract. The failure rates for video scopes vary based on usage and cleaning processes, but they generally have a higher failure rate than the electronic components.
MD Buyline recommends scope-only coverage at point of sale. It is also useful to track repair costs on a time and materials basis and compare those costs side by side with a service contract to determine which method of service is most cost effective. A facility should also concentrate on user education to prevent service problems. Educating clinicians to use endoscopes properly will prevent costly repairs or the need for costly service contracts.
Reimbursement rates are based on the type of procedure, but overall have been steadily increasing. For example reimbursement for a screening colonoscopy (APC 143) in 2011 was $569. This went up to $577 in 2012, $611 in 2013 and is currently $746 for 2014.
Likewise, reimbursement for a Level 1 Laparoscopy (APC 130) surgical procedure was $2,662 in 2011 and has been rising steadily since to $2,713 in 2012, $2,730 in 2013 and $2,930 in 2014. However, this increase in reimbursement is tempered by the cost of scopes, which is also increasing at a rate of 2 to 3 percent. Hospitals that do not strategically negotiate pricing will see their reimbursement increases absorbed in higher scope costs.
Endoscopic Surgery Video System
GI Video Purchase Price
Low High Average
$31,072 $104,238.32 $66,030.23
Surgical Video Purchase Price
Low High Average
$22,181.57 $96,157.25 $55,705.68
System Service Support Prices
Low High Average
$20,696 $140,000 $66,542.64
Data Source: MD Buyline
Please note these numbers have been adjusted to exclude special deals, outliers, and unique circumstances.