The challenge was to find a management partner that could meet the hospital’s three goals:  cost savings, preservation of its current level of maintenance service, and staff support.
Prior to narrowing the field of bidding companies, Cortland gathered information on numerous maintenance programs and services. They then reviewed this information with their four partner hospitals as well as with a team of Cortland clinicians, administrators and support staff. The team consisted of the director and a lead technologist from the radiology, ultrasound, nuclear medicine, and cardiology departments; the vice president of finance; and staff from the hospital’s purchasing and accounts payable department. "We especially wanted to involve staff from the imaging departments since most of our maintenance dollars were being spent in those areas," Davis commented.

Staff involvement is a critical component of Cortland’s selection process.  Davison noted, "We always try to use a collaborative approach to decision-making. Whenever the hospital pulls together a list of acceptable bidders and begins the final selection process, we try to include those staff, such as lead technologists, who would be most affected by a change. They are the ones who call for service, wait for service, and ultimately determine if they are satisfied with the service. If they are not happy, there is a greater potential for program failure."

The hospital interviewed several companies before making its final selection:  Thermo USCS. They responded to the hospital’s detailed questions via numerous on-site and telephone conferences. They also conducted a comprehensive analysis and benchmarking of the hospital’s existing maintenance expenses and coverage (which at the time was 90% service contracts). Their LIFECYCLE Program provided the greatest savings. It also helped that one of the four hospitals within the alliance had used this program successfully.
The program guaranteed the hospital a 17% annual savings in maintenance costs (vs. existing costs) while preserving the hospital’s current level of service. Prior to implementing the program, the hospital had annual maintenance costs of $198,578. The program also was endorsed by Amerinet, an important consideration in the hospital’s final decision.
Ultimately six departments were included in the program: nuclear medicine, ultrasound, surgery, cardiology, radiology, and CT. The hospital further customized their program by selecting the following services:

•Access — which provides on-line access to the hospital’s equipment listing, maintenance history, vendor payment status, preventive maintenance information, and program operation.

• Acquisition resource — which provides proposal analysis for capital equipment purchases; and

• Equipment tracking — in which corrective and preventive maintenance repairs and costs are tracked at no charge on items not included in the existing program. 

The hospital is mid-way through its second year in the program. First year savings were $37,925 (20.3% savings vs. pre-program costs). Second-year savings are expected to be $40,158, with third-year savings expected to be $39,967. Acquisition Resource also identified potential savings of $29,398 in new equipment purchases.

 But perhaps the most important indicator of staff support for the program has been the record number of calls to the program’s hotline, said Davison. This is an engineering service offering real-time repair assistance, alternate parts and labor sources, historical reference on equipment and service procedures, and preventive maintenance recommendations. In the first year of the program, staff contacted the hotline 15 times, saving nearly $26,300.

 Davison said the hotline is where hospital staff can see the real impact of the program in reducing costs. For example, in June 2002, the ultrasound department called 15 times for advice regarding a cracked crystal on an ultrasound transducer. The hospital learned that the manufacturer typically charges $9,600 for a new transducer. However, USCS’ hotline advised that an independent service organization could repair this transducer and provide a loaner during the repair for $4,500 (including a one-year warranty). Total savings:  $5,100.

 This type of information continually strengthens staff resolve to actively manage costs, Davison stated, "Overall, this program has helped us save money and increase staff knowledge of the money we do spend for maintenance. With this knowledge, staff now plays a more active role in making decisions on equipment repairs."