Technical Service Contracts For Cataract And Vitreoretinal Surgical Equipment: A Budget Impact Analysis

Technical service contracts with manufacturers have become increasingly valuable to healthcare facilities as unexpected equipment breakdowns can have large financial and logistical impacts to cataract and vitreoretinal surgery facilities. Service contracts can allow for better management, maintenance of surgical equipment and ensure safety for patients. Service contracts offer diverse tiers to customers, with different level of services to meet these needs. The aim of this research was to understand the financial and operational impacts different tiers of contracts can have on a practice.

Not Applicable

A budget impact model was developed. Variables of efficiency: price of the annual contract, loss of revenue due to operating room (OR) standstill hours, and price of Clinical Application Specialists (CAS) support.  In a hypothetical large hospital performing public procedures, there was one Ngenuity 3D Visualization System, Constellation Vision System, and LuxOR Microscope, and three Centurion Silver Systems. Current state: all equipment were on preventative maintenance contracts. Future state: Centurion Systems and LuxOR were upgraded to full repair cover, 24-hour response time and loaner equipment contracts, Constellation and Ngenuity were upgraded to full repair cover and 48-hour response time contracts.

In this one-year time horizon analysis, 171,833 euros were estimated to be saved by the hospital if the facility were to upgrade their service contracts based on our case study settings. There was no cost difference in CAS support. While there was a cost increase of 41,374 euros for price of contracts, there was still overall cost savings due to 213,207 euros in cost savings from potential revenue loss due to faster estimated response and repair times. Each Centurion saved 34,554 euros, LuxOR saved 52,682 euros, Constellation saved 14,025 euros, and Ngenuity saved 1,464 euros.

Proper mix of service contracts could drive important efficiencies for hospitals performing cataract and vitreoretinal procedures. A conservative approach for the modeling was used as many other cost drivers were not considered in this analysis such as labor, spare parts, or administrative time to issue purchase orders. Therefore, benefits may be even more pronounced in large hospitals with long waiting lists or private clinics with busy ORs. Further research would be needed to estimate these impacts more accurately.