Should I Buy or Rent a Surgical Laser for Our Hospital?
The surgical laser segment has seen strong sales growth in recent years, with more expansion expected in the future. One report notes that the global medical laser market is forecasted to grow from $5.57 billion to $13.17 billion USD between 2023 to 2030 — a compound annual growth rate of 13.1%.
With the rise in demand for minimal-access surgeries, lasers will continue to be a vital tool in healthcare.
The increased demand for surgery presents a dilemma for hospitals and other medical institutions when acquiring surgical lasers. Specifically, is it better to buy or rent?
Several factors need to be analyzed when it comes to formulating a business case for a device purchase, and these are unique for every medical institution.
Buying vs renting surgical lasers: factors to consider
The decision about buying medical devices largely comes down to economic factors. More specifically, the available capital for an initial outlay, such as a down payment or the entire purchase amount, is a major factor that can sway the purchase decision. Other financial considerations may include:
- Revenue opportunities versus costs (initial and ongoing)
- The availability or lack of financing
- Available cash flow for ongoing rental payments, maintenance, upgrades, and replacements
Frequency of usage
Will the device be used all the time? Will it be a major revenue generator that will more than offset costs? These are questions that both medical teams and procurement professionals must ask.
If usage will be infrequent, renting may be worth considering.
Lifespan
Every medical device, including a surgical laser, will have a lifecycle. After a few years or decades, factors such as breakdowns become more of an issue, potentially costing medical institutions money.
Does the surgical laser you are considering have a long lifespan worth the capital outlay? Obsolescence and downtime can be more significant considerations if buying a secondhand laser, so renting may be an attractive option for institutions with minimal capital who still want a newer machine.
Maintenance
The availability of maintenance resources is a major consideration when deciding whether to rent or buy a surgical laser. Do you have an in-house biomedical engineering team with the skills required to quickly troubleshoot or fix a medical laser and/or replace components when required? Buying the device will require a higher maintenance expenditure, which is worth noting.
Cleaning
Of course, every medical device, including surgical lasers, needs to be cleaned to maintain a sterile environment. If renting a laser, you should check to see if the provider offers periodic cleaning as part of the rental agreement. If not, your hospital or clinic will need to make arrangements for proper cleaning on a regular schedule.
Buying medical devices
Buying new surgical lasers can make sense if your medical institution has the available capital to acquire these innovative medical devices. Some healthcare establishments use third-party companies to clean and maintain medical equipment. For this reason, you may not need technicians in-house for these tasks, removing a potential objection to purchasing a surgical laser outright.
Additional benefits of purchasing a surgical laser include:
- Ownership: when you buy a medical laser, you own the equipment outright. This can be advantageous in the long term as you won't have ongoing fixed costs to deal with in the form of rental payments.
- Long-term Cost Savings: While the initial upfront cost of purchasing a medical laser may be high, it can often be more cost-effective over the long term as the total cost of ownership over the device's lifetime can be lower.
- Flexibility: As the owner, you have the flexibility to use the equipment as you see fit without any restrictions imposed by a lease agreement.
- Customization: You can customize and upgrade the laser system according to your specific needs without limitations that a rental agreement may impose.
When to buy a secondhand surgical laser
When buying used medical lasers, it’s worth considering the possibility of higher maintenance costs and potential obsolescence. Sure, the machine may cost less now, but will it incur more significant expenses down the road? Will you be taking a short term or long term view with the purchase?
Also, will a used machine come with any warranty? Buying used can be a reasonable option for medical equipment such as lasers that have a longer lifespan with less maintenance.
Renting medical devices
Renting medical lasers can be an excellent option for hospitals or clinics that lack a lump sum for the initial capital outlay and do not wish to pursue financing options.
It’s worth researching any perks that come with the rental, such as maintenance, service, and support programs. Additionally, you’ll want to look at whether or not the rental terms are favorable and try to negotiate those in your favor.
Weigh your options
The decision about whether to buy or rent a medical laser is a resource allocation move.
Buying new can make sense if you have a large amount of capital and consider total cost of ownership over the lifetime of the device to be important. New machines will also depreciate over time, and this must be priced into the purchase. Lastly, a strong warranty can instill confidence in the purchase and make for a stronger business case.
For institutions with less capital who lack a team of biomedical electronics technicians, buying a used machine can be a reasonable option as long as there is a strong plan in place for obsolescence and repair as well as replacement parts.
Medical institutions that have strong cash flow but little to no capital for a lump sum equipment purchase may want to rent a machine, especially if the revenue opportunities make for a compelling business case. Rentals may come with bonuses to sweeten the deal, which is worth considering in the overall purchase decision.
Ask our team their advice for your needs
In the end, each purchasing professional will have to make a decision that suits their unique circumstances, as no two situations are the same.
If you have questions and want to discuss your needs and options for surgical lasers, get in touch with the IML team of experts.
