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Special report: Choosing service contracts

by Loren Bonner, DOTmed News Online Editor | August 17, 2012
From the August 2012 issue of HealthCare Business News magazine


Nick Hersman, strategic marketing product manager, MEDRAD Service

  • When comparing quotations from multiple vendors for service level agreements (SLAs) on the same piece(s) of equipment, be sure to understand each vendor’s offering. Not all full service contracts, for example, are the same. Each vendor may provide a different level of service under the ‘full service’ name. Read through the terms and conditions of the agreement and make sure any negotiated terms outside of the standard terms and conditions are properly documented.


  • Be sure to align your uptime requirements/downtime tolerability to the service provider’s SLA that best fits your needs. If there is a possibility to contract for an up-time guarantee, for example, that aligns to that piece of equipment’s requirement for being ready for use then that should be considered when selecting an SLA.




  • You may have several pieces of equipment from the same OEM at your facility. However, one level of SLA may not fit every piece of equipment. Be sure to explore the ability to customize your SLA for the specific needs of each piece of inventory. This will most likely be dictated by the frequency of use of a particular unit and/or whether there are back-ups available.


  • Many facilities have in-house capabilities provided by a biomedical/clinical engineering staff. If you are a department outside of these groups and are responsible for making the decision on which SLA to purchase, then consult with your in-house team and determine what support, if any, they can also provide. If your biomedical/clinical engineering team can provide first-look support this may enable you to negotiate a contract of lesser cost, just by leveraging an already existing in-house resource.


  • In today’s health care environment, there are many governing bodies that are regulating certain actions be taken on devices within a facility. Be sure to discuss any new regulations that pertain to service with cross-functional groups, such as biomedical/clinical engineering, risk management, legal, etc. Also, do not hesitate to challenge your service providers on how they are ensuring you are meeting any new regulations that may have been put into place.


Jeff Fall, president, Oxford Instruments Service
Jeff Fall, president,
Oxford Instruments Service

  • The most important thing to consider is your vendor of choice. Some questions you should consider: Can the vendor provide you with the savings you need in the current reimbursement environment to allow you to profitably operate? Do they have quality engineers? What kind of response time do they offer? Do they have the parts required to service your equipment and how long will it take to get parts to your site? Do they have a proven track record of satisfied customers and will they share a comprehensive reference list? Are they ISO certified?


  • The major advantage to working with a non-OEM is cost savings. Quality third party vendors understand that to earn business they must provide a high level of service at a lower cost when compared to the OEM.

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