Medical Practices Can Reduce Costs by Thinking about More Than Price

February 19, 2014

Smart purchasing decisions at medical practices require an appropriately broad view of the needs and alternatives.

Every day I notice people doing things that make no sense.  This morning, a cashier at the coffee shop set two coffee cups and a muffin on a plate on the counter in front of me. She made no offer of a tray.  Rather than ask for a tray, I awkwardly tried to manage those three items and my purse with my two hands.  Both the cashier and I took too narrow a view of the task at hand.

Medical practices often do the same thing when it comes to equipment and supplies.  As an example, consider printers.

Printers have become inexpensive, readily available, and easy to install.  When one breaks, the rational decision is to replace it with the least expensive one available, regardless of brand or model.  Common sense, isn't it?  Not exactly.

An important printer specification to consider is duty cycle, which is the number of pages per month the printer was produced to handle.  The higher the duty cycle, the more pages per month the printer can reliably handle without breaking down or dying young.  A low duty cycle printer in a high volume environment is a false economy.  A high duty cycle printer in a low volume environment, such as the typical physician's desk, is a waste of money.

The most expensive printer I ever owned was free.  It was a dot matrix and printed in color.  I seldom needed to print in color, but it seemed to be a nice feature to have when I needed it.  The letters, proposals, articles, and reports I typically printed would exhaust the black ink within a week.  Then, I would have to replace the cartridge full of yellow, blue, and red ink with a fresh, very expensive cartridge. 

I am trying to make two points: 

1. Features you do not use can increase your equipment costs without providing any value.
2. The purchase price of equipment can be the least important part of the story.  In the printer example, the per page cost of the consumables  - ink and toner - are at least as important.

Make and model also impact another cost of consumables:  cartridge inventory.  The office should have at least one cartridge on hand for each type of printer. There is no reason for a printer to be out of service while the office waits for the next delivery of office supplies.  (If that is no hardship for the office, the printer is probably unnecessary and is wasting space.) 

The point often missed is that different models of printers may require different cartridge models, even if they are from the same manufacturer.  When buying a new printer, it is worth more than a few dollars to buy one that uses the same cartridges as printers you already own.

The final factor to consider is the printer driver, which is the software your computer uses to communicate with and "drive" the printer.  If you have ever wondered why a document prints perfectly on one computer and strangely formatted on another, this is probably the reason:  The two printers had different drivers. 

If the practice uses standard forms and letters, different drivers can be an operational nightmare.  Documents seldom print properly the first time; staff spends time "fixing" them; and the next user may have to "fix" them back.

In evaluating any equipment, total cost of ownership (TOC) is an important concept.  A short definition of total cost of ownership includes purchase price, consumables, maintenance and usable life.  It should also include operational aggravation, or the lack thereof.

Good decisions require good choices between alternatives, and those require an appropriately broad view of the task at hand.