Medical facilities are faced with one of the most expensive and somehow sophisticated equipment investments. In order to have a significant impact on their clients, individuals and institutions that are engaged in practicing medical services are faced with the need of procuring the latest and state of the art equipment. However, with all this investment, the very tools are quickly rendered obsolete by the passage of time and the ever changing technology. It is therefore important and necessary to thoroughly analyze each and every investment decision in order to realize the most economical use of the scarce financial resources. This particularly entails a close comparison between making a purchase and renting medical equipment.
It is possible to finance your medical facility 100 percent by renting tools. Some of the medical implements offered for rental include; X-ray and ultrasound machines, surgery items, MRI machines, computers, imaging diagnostic tools and EMR software. There are however some considerations to be made before settling on the rental decision.
Be sure to begin with evaluations of a rent vs. Buy decision. Analyze the two alternatives in order to reach the most beneficial and efficient decision. Compare the price of buying the item against various lease quotes available, while considering different manufacturers, dealers and leasing companies.
A good supply of information is important for a complete financial analysis. You should therefore access the most vital and pertinent financial information before embarking on the analysis. The data will be helpful in assessing the feasibility of the particular project, which can only be arrived at by estimating the cash flow of the investment. The incremental cash flow denotes the additional expenses and revenues accruing from the project. It is from this cash flow that one can know how a particular project will better the performance of the business, which is contrary to a rather unidirectional approach as to whether a particular project will generate profit on its own.
The comparison should however not stop here. Further analyze the data with a break even analysis, a net present value analysis and a payback value analysis. With these analyses, you are furnished with both the short and long term financial implications of the particular investment. It also denotes the duration of time it will take to recoup the initial investment.
However, it is worth considering that the cost of renting is, to a better extent, determined by the rate of the lease. It is therefore necessary to put in mind the factors influencing medical equipment lease rates. One such vital factor is the period of the lease. Before making the decision to rent, ascertain the period you are going to rent the equipment and evaluate the financial implications.
Another element worth considering is the schedule of service (repair). During the period of rent, the user is responsible for maintenance of the item. It is therefore essential to opt for a deal having a fair number of services, coupled with convenient service time. For example, on-site servicing proves rather convenient. The type of lease, whether operating or capital, also determines the amount of monthly payments. Operating leases are less expensive than capital leases, they are entirely rental agreements. On the other hand, Capital leases entail residual ownership of the item.
Simply put, the decision process whether to rent or buy a medical equipment relies more on ascertaining which option will be more beneficial to your practice; the bottom line; evaluate how the investment fits with your general business plan, compare it to alternative opportunities in your practice and determine whether it will be profitable on its own while improving the present and future overall financial performance of your practice.
It is possible to finance your medical facility 100 percent by renting tools. Some of the medical implements offered for rental include; X-ray and ultrasound machines, surgery items, MRI machines, computers, imaging diagnostic tools and EMR software. There are however some considerations to be made before settling on the rental decision.
Be sure to begin with evaluations of a rent vs. Buy decision. Analyze the two alternatives in order to reach the most beneficial and efficient decision. Compare the price of buying the item against various lease quotes available, while considering different manufacturers, dealers and leasing companies.
A good supply of information is important for a complete financial analysis. You should therefore access the most vital and pertinent financial information before embarking on the analysis. The data will be helpful in assessing the feasibility of the particular project, which can only be arrived at by estimating the cash flow of the investment. The incremental cash flow denotes the additional expenses and revenues accruing from the project. It is from this cash flow that one can know how a particular project will better the performance of the business, which is contrary to a rather unidirectional approach as to whether a particular project will generate profit on its own.
The comparison should however not stop here. Further analyze the data with a break even analysis, a net present value analysis and a payback value analysis. With these analyses, you are furnished with both the short and long term financial implications of the particular investment. It also denotes the duration of time it will take to recoup the initial investment.
However, it is worth considering that the cost of renting is, to a better extent, determined by the rate of the lease. It is therefore necessary to put in mind the factors influencing medical equipment lease rates. One such vital factor is the period of the lease. Before making the decision to rent, ascertain the period you are going to rent the equipment and evaluate the financial implications.
Another element worth considering is the schedule of service (repair). During the period of rent, the user is responsible for maintenance of the item. It is therefore essential to opt for a deal having a fair number of services, coupled with convenient service time. For example, on-site servicing proves rather convenient. The type of lease, whether operating or capital, also determines the amount of monthly payments. Operating leases are less expensive than capital leases, they are entirely rental agreements. On the other hand, Capital leases entail residual ownership of the item.
Simply put, the decision process whether to rent or buy a medical equipment relies more on ascertaining which option will be more beneficial to your practice; the bottom line; evaluate how the investment fits with your general business plan, compare it to alternative opportunities in your practice and determine whether it will be profitable on its own while improving the present and future overall financial performance of your practice.
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