Outpatient Surgery Magazine, providing current information on Surgical Services, Surgical Facility Administration, Outpatient Surgery News and Trends, OR Excellence and more.
Issue link: http://outpatientsurgery.uberflip.com/i/1316512
Staying the course in troubled waters An interview with Michael Rhodes, Getinge Strategic Sales Director, ASCs, on the importance of equipment leasing The uninterrupted patient volume and revenue growth that ASCs have experienced in recent years has been jeopardized by governmental restrictions in response to the ongoing COVID-19 crisis. The Becker's ASC Review report (see reference page 1) also noted that up to one-in-five patients elected to postpone their elective surgeries during the pandemic. In this highly fluid and uncertain financial environment, Managing Risk sat down with Michael Rhodes, Getinge Sales Director, ASC, to discuss the ways in which Getinge Financial Services is helping Ambulatory Surgical Centers acquire the capital assets they need to survive and prosper in the age of COVID-19 and beyond. 2020 has had many disruptions. How have events impacted the capital budgets and financial strategies of ASCs? The fact is, 72% of all ASCs are independently owned and many of these are recent start-ups and highly entrepreneurial by nature. Relatively few have vast capital reserves, so when revenues took a sudden downturn, infrastructure and capital equipment projects were put on hold. Available funds had to be redirected in order to keep the doors open. How would you characterize the financial dilemma that ASCs are facing? The equipment leasing and finance industry's Horizon Report shows that roughly one-half of all private-sector equipment acquisitions are financed with secured loans or lines of credit. Unfortunately, cash is now scarce for many ASCs that in the past might have eschewed equipment financing of any kind. Compounding the problem, secured loans may be harder to obtain, be more expensive, and less flexible given market uncertainties and a financial institution's perception of increased business risk during the pandemic. At the same time, ASCs are forced to look at existing or future lines of credit to fund operational losses, and not capital equipment purchases. Where does that leave ASCs that want to move forward with their pre-COVID strategic business plans without additional delays? The good news is they don't have to wait, because Getinge Financial Services' lending sources understand these temporary market dynamics, and have worked with our company to offer attractive leasing options that optimize cash flow, reduce or eliminate upfront costs, and lower scheduled payments. In many instances there are associated tax benefits as well. Just as importantly, an equipment lease helps eliminate the very real concern of equipment obsolescence in a technology-driven field. Can you point to a few examples of these creative financing options our readers may not be as familiar with? Getinge's innovative pay-for-use option allows our customers to pay a caseload, or cycle rate, for the use of their equipment. These options help align leasing payments with revenues generated by the billable fees for treatment in a given period of time. This same concept is applied to the financing of daily use products for the ASC's sterile processing depart- ment, and takes into account the peaks and valleys of patient throughput. It's also important to point out that within our wide portfolio of flexible operating capital and finance leases, our lending sources will (in many cases) approve lease terms up to 84 months — where others will not exceed an amortization period of 60 months. What type of equipment can be financed using any one of these options? When you walk through any ASC and take note of all the OR and infection control equipment in the facility, you'll find that Getinge can serve as a single-source provider for everything you see. I can't think of another supplier that can make that claim! Surgical tables and lights; anesthesia machines; sterilizers and washer-disinfectors; OR integration systems; OR management solutions; daily-use products for the CSD; and even modular room systems…we offer it all. In short, ASCs can buy it, finance it, service it, and design it through Getinge as a truly strategic — not transactional — partner that can unlock the maximum value of purchasing decisions.