Medical, Lab & IT Equipment Benchmarking & Analytics

Medical, Lab & IT Equipment Benchmarking & Analytics

April 10, 2017


3 Ways Hospitals Can Drive Immediate Medical Equipment Savings After a Merger or Acquisition

As the healthcare landscape sits under a cloud of uncertainty – and looks to remain so for the foreseeable future – more and more hospitals are joining forces, merging as margins tighten and as competitive leverage in insurance negotiations grows tighter. In the first six months alone of 2016, Kaufman Hall found an increase in mergers and acquisitions of 6.1% from the year before. Just this month, PinnacleHealth announced its acquisition of four hospitals and partnership with University of Pittsburgh Medical Center (UPMC).

There’s much advantage to be found in such moves, to be sure, but once they take place, there’s often a mad rush to eliminate excess cost and inefficiencies as soon as possible. Budget cuts and layoffs are often first on the list…and these changes don’t tend to have the best aftertastes. But what if we told you there were other hidden areas of cost savings that didn’t involve cutting anything?

In our experience, many hospitals tend to overlook an opportunity to create incremental and recurring savings from these deals. It’s called initiating a medical equipment standardization strategy, and it can quite literally save your hospital millions of dollars during a merger or acquisition.

Fleet standardization tends to be the most overlooked activity in a hospital merger or acquisition. This is partially because, while it offers significant savings opportunities, it is also incredibly difficult. The accurate information you need to make smart decisions about inventory and service contracts is hard to find, as is figuring out the value and what to do with all the underutilized equipment that turns up in these deals.

If your organization is undergoing a merger or acquisition, here are 3 great tips to help you uncover those savings:

  1. Leverage Spot Market Pricing to Supplement Your Fleet – Most health systems choose to standardize certain types of equipment with one manufacturer to streamline costs and make it easy for staff. Look to take advantage of “spot” market prices and special discounts or promotions; a well-timed supplemental purchase of equipment can save as much as 20% compared to what you would otherwise have paid.  Before you buy, make sure to benchmark any quotes you receive.
  1. Identify and Recover Cash Value From Underutilized Assets – With many hospital mergers or acquisitions, there can be duplicate or overlapping services that can often result in a surplus of clinical assets. Many of these assets may be relatively new and in good condition, but don’t let the temptation of putting them aside for a “rainy day” win you over.  The best time to recover maximum value for clinical assets is at the time when you stop using them!  A systematic utilization review can enable you to identify the potential market value for resale, trade-in or continued use.
  1. Stretch Capital Budgets By Purchasing Pre-owned Equipment – There is rarely enough capital in most hospital budgets to meet all the needs and “wish list” requests from physicians and staff. Mergers often present great opportunities to introduce new savings strategies and if your hospital doesn’t currently consider pre-owned equipment as a way to save, maybe now is the time.  You can often find quality, pre-owned equipment at up to 40% less than the cost of new without impacting reimbursement.  An effective clinical engineering team or third party service provider can frequently provide reliable services for many different pre-owned systems and help keep equipment running reliably for many years.

We will continue to use this blog as a venue to share other insights and savings ideas related to the medical equipment lifecycle. As always, please don’t hesitate to share your own thoughts or suggest other topics of discussion. It would be great to hear from you!

Know the right price.

And get it.

Having the right information saves hospitals time and money on medical equipment lifecycle costs.

Scott Bosch

Manager of Clinical Engineering

Park Nicollet Health Services

“The groups responsible for managing technology in our healthcare organization need data and analysis to manage costs and make informed decisions. Miga’s EVMS platform is an important and valuable resource that helps us make the right decisions for both our clinical priorities and budget.”

Matt Werder

Chief Technology Officer

Hennepin County Medical Center

“Miga’s data is key to helping us be good financial stewards and validates we are using our resources wisely. The market intelligence provided by Miga’s EVMS platform has allowed us to save substantial amounts of money.”

"Miga’s ability to match equipment donated by their customers with the needs of our medical projects has been a most valuable and welcomed resource."

Jim Tierney


Suburban Radiology

“Miga’s data, analysis and expertise – in particular related to the fair market value of clinical equipment – is a critical resource we need to support strategic acquisitions, divestitures and joint ventures.”

Eric Hoag

Director, Corporate Strategy & Development

Allina Hospitals and Clinics

“Miga’s proprietary data and expertise was critical to our ability to close an acquisition deal quickly and with a high level of confidence in our valuation.”

Bill Barta

Corporate Director, System Imaging

Fairview Health Systems

“Miga’s objective information-based approach and understanding of the needs of hospitals makes them a valuable resource and helps us make the most cost effective spending decisions.”

Matt Blashill

Enterprise Director of Supply Chain

Lake Region Healthcare

"There’s a personal touch that sets Miga apart from their competitors. They don’t just offer great insights. They always take the time to provide additional analysis that is meaningful and actionable."

Dan Bazinet

Director of Clinical Engineering

Southcoast Health

“In all my years in health care, I’ve used a lot of benchmarking tools. Most simply repeat information passed along from others; Miga’s information tells me what’s really happening.”


Community Hospital

"Miga's negotiating skills save us time and money. And their unique understanding of the market means we’re always playing from a position of strength."

Supply Chain Director

Regional Healthcare System

“All suppliers claim to have excellent customer service. Miga actually walks the talk and always has our best interest at heart. We love working with them."