Managing Emergencies and Finances Simultaneously: Does It Make More Sense to Lease Medical Equipment Now?

The entire world is suffering from the economic impacts of Covid-19, which has proven to be more lethal for the global economy than it is for human lives at the moment. So, now more than ever, when hospitals and healthcare clinics are swarmed by panicked crowds, the age-old question regarding whether to buy hospital equipment outright or to lease them for a short period is an extremely potent one.

Understanding of the Two Concepts is Essential

Before you make a decision in either direction, it would be wise to first understand the options in their full clarity. Only then would it be possible to theorize and calculate the long-term financial impacts that decision to buy or lease healthcare equipment may have on the clinic.

Leasing Medical Equipment – You are renting the necessary healthcare equipment for a particular time period and once the lease is over, the equipment must either be returned, bought or renewed for another lease agreement.

Buying Medical Equipment – It’s as straightforward as it gets really, but unless you are paying in full, calculating the total amount you are paying for the equipment (price + interest) is essential.

The Decision Should be based on the Situation and Not through Generalization

As it should always be with all decisions in healthcare, the decision to lease or buy healthcare equipment should be made depending on the situation, rather than observing one or the other as a general rule.

For example, to make and accommodate a quarantined ward, additional hospital beds, masks, sanitization equipment, and all other necessary apparatus must be procured. Due to the nature of the current emergency and its suddenness, leasing would most likely be a better option. If an emergency is not expected to last, then buying extra equipment would actually be a poor decision from a business perspective.

Making the Right Calculations

To take the right decisions, you need the right data to work with. While this data may come in many forms, the most basic calculation you need to make is whether the cost of a lease or rent is exceeding the cost of the original equipment.

It’s not a particularly easy calculation because plenty of unpredictable facets need to be taken into account as well, which are plentiful in healthcare! Nevertheless, the closer to accurate the estimation is, the easier it will be for you to take the right decision. As a general rule though, three primary factors should be taken into account.

• For how long will you need the equipment?
• How useful is it to the clinic’s day-to-day operations?
• How long is the expected lifetime of the particular healthcare equipment?
• How large is the price tag of the machine that of the total order of supplies you need?

Although there will always be additional factors to consider, making the right decision should now be easier, given that these are the most important factors to be taken into account before making that all-important choice between leasing and buying.