AHRA: Top strategies for curbing service agreement costs
The tips were offered by Vicki Petersen, MS, of Premier Performance Partners, who outlined the various service program models. Having an in-house service team is certainly an attractive option from the point of view that service staff would really know the department they were working with, but this is not a financial reality for most practices. Instead, many will strike up service agreements with the original equipment manufacturer (OEM), a third-party or some hybrid of OEM, third-party and in-house support.
When it comes to negotiating service agreements, Petersen warned against getting locked into a contract that could make it hard to change strategies at a later date. “A lot of companies push for those very long service agreements,” she said. “It used to be a three-year, then they got a five. I see seven and 10 out there that people are locked into because they ‘got a good deal.’ It’s not a good deal.”
Timing makes a big difference in negotiations, and Petersen said service rates are always negotiable, even if a company initially says they are not. The best time to enter a service agreement is at the point of sale for the equipment needing service. Less ideal, but still adequate is after the equipment’s warranty runs out or immediately before a service agreement’s scheduled renewal. Waiting till after the expiration of an agreement to negotiate another should be avoided, and Petersen suggested staying on top of agreement term dates.
Petersen also advised looking collectively at equipment, not individually. For example, a practice with multiple CT scanners can scale back on service costs by not electing to have 24/7 coverage on all scanners, but rather only on one or two.
Likewise, tube coverage is another area where practices can save some service costs. Petersen said one option is to go “at risk” without tube coverage. Finance needs to give some leeway in these scenarios, and Petersen said that tube money could initially be set aside in case there’s an issue, rather than being totally cut from the budget. “Make sure finance understands that you’re doing things at risk.”