MANAGEMENT OF MEDICAL DEVICES - WHO | …

1 MANAGEMENT OF MEDICAL DEVICESG lobal Forum on MEDICAL DEVICES , Bangkok 2010 Areas requiring further strengtheningDILIGENCE & STEWARDSHIP It may seem a strange principle to note but the prime duty of a hospital is to do the sick no harm Florence Nightingale, 1860 Florence Nightingale, 1860 As a body accountablefor taxpayers money, we should be able to itemize, track and monitor all MEDICAL equipmentpurchased CEO Greater Glasgow Health Board, 1986 PHYSICAL ASSETS IN HEALTH CAREE xample from ScotlandSTRATEGIC ASSET MANAGEMENT3 KEY QUESTIONS1. What is the current position? Organisations need to establish a baseline position that identifies their current assets and how well these are contributing to supporting service delivery. What condition the assets are in and how suitable they What are the plans for healthcare in the future, and what assets are needed to support current and future service needs?

2 3. Is there a strategythat outlines how the organisation will move from its current position to its future position? This means developing an action planthat covers future asset acquisitions, disposals and : Adapted from Towards Better MANAGEMENT of Public Sector Assets, Sir Michael Lyon, 20045 KEY ELEMENTS OF OPERATIONAL ASSET MANAGEMENT1. Planning what assets are required and Acquisition how assets are funded and which partners might be Operation and maintenance ensuring assets are maintained and performing adequately & Disposal what the best future use is for an Performance MANAGEMENT and monitoring collecting and managing data to inform asset ISSUES WITHIN KEY ELEMENTSMEDICAL DEVICE LIFE CYCLES ervice ObjectivePlans & strategiesNew needs & priorities Review use & replacement needsKeep maintainedDisposal Performance MANAGEMENT , Risk Assessment & MonitoringInventory / Records / AuditsDelivery, installation & trainingProcurement (incl.)

3 Leasing, donations etc)Decide procurement mode & allocate fundsIdentify options & appraise life-cycle costsOperationAREAS OF CONCERN IN LIFE CYCLES ervice ObjectivePlans & strategiesNew needs & priorities Review use & replacement needsKeep maintainedDisposal Performance MANAGEMENT , Risk Assessment& Monitoring Inventory / Records / AuditsDelivery, installation & trainingProcurement (incl. technical specifications)Decide procurement mode & allocate fundsIdentify options & appraise life-cycle costsOperation1. LCCA & NET PRESENT VALUE The essence of financial appraisal is to place a financial value on all life cycle costs, benefits and risksso that a thorough evaluation can be made of the relative merits of various equipment options and methods of funding.

4 The most common methodology for public sector capital equipment procurement, is to use the net present value technique (PV)under which all costs and benefits are recalculated to represent their net value to the institution today, thus making comparisons more accurate. "Jam today is worth more than jam tomorrow . For public sector financing, more value is placed on current costs and benefits than on those which might apply in the future. To bring future costs and benefits into the same perspective as current ones a "discount rate" is applied. LIFE-CYCLE COST ANALYSISESTIMATED LIFE-CYCLE COSTS OF RADIOLOGICAL SERVICE IN NEPAL (Rs Present Values)Cost* ( )$30,000 Discount : Rs per $ Value exams per day4(actual at Laha n DH - June'00)Lifetime (years)15 Working days per month24(* b ased on WHIS-RAD system at Lah an DH)

5 YearCapital CostStaff CostsConsumablesMaintenanceBuildingsOver headsTotalPV FunctionPresent Value02,062,5002,062, ,062,500158,80051,84015,00011,760137, ,264258,80051,84082,50015,00011,760219, ,766358,80051,84082,50015,00011,760219, ,149458,80051,84082,50015,00011,760219, ,816558,80051,84082,50015,00011,760219, ,758658,80051,84082,50015,00011,760219, ,963758,80051,84082,50015,00011,760219, ,422858,80051,84082,50015,00011,760219, ,126958,80051,84082,50015,00011,760219, ,0651058,80051,84082,50015,00011,760219, ,2311158,80051,84082,50015,00011,760219, ,6151258,80051,84082,50015,00011,760219, ,2091358,80051,84082,50015,00011,760219, ,0051458,80051,84082,50015,00011,760219, ,9951558,80051,84082,50015,00011,760219, ,173 Present Value of Annui tyAnnual EquivalentTotal : 2,062,500882,000777,6001,155,000225,0001 76,4005,278,500 Total4,448, ,81139.

6 1% .3% % exams/year1152 NotesCost/x-ray (Rs)344 Capital Cost : For WHIS-RAD 100mA X-ray machine (as purchased for Lahan DH)No . per yearCost/X-ray (Rs)Overheads :Based on one radiographer at basic salary Rs 4,900 per month 5,0 001 10 Consumables : Based on film (12x15) and reagent costs of Rs 45. per st andard exam4,0 001 27 Maintenance : Based on annual contract at 4% per annum of replacement cost2,0 002 08 Buildings :Based on 50 @ asset value of Rs 5,000 per , depreciated over 50 years plus 1% per year for m aintenance1,0 003 71 Overheads :Based on 20% of staff costs; for administration & logist ic services/support and utilities5006 99 ELEMENTS OF LCC ANALYSISLCC OF WHIS-RAD X-RAY OVER 15 YEARS (4 exams per day)Buildings4%Consumables15%Staff Costs17%Capital Cost39%Maintenance22%Overheads3%LCC OF INDIAN 100mA X-RAY OVER 15 YRS(average exams per day)Buildings7%Capital Cost13%Staff Costs28%Consumables39%Maintenance7%Overh eads6%Porter, 2000 COST PER PROCEDURECOST PER STANDARD X-RAY EXAMINATION01002003004005006007002345678 91011121314151617181920No.

7 Of radiographs per dayC o s t p e r X -r a y (R s )Lahan DH - WHIS-RAD- June'004600 exams/yearSurkhet DH - Indian GE - June'00 Porter, 2000 COMPONENTS OF COST PER IPD IN AN 8-BEDDED ICU DEPARTMENTC apital Cost2%Other Capex6%Maintenance5%Overheads19%Staff Costs19%Blgd (D&M)2%Consumables47%BO% = 60%Porter et al., 2003 SPECTRUM OF ULTRASOUND USES urvey of 87 units0%10%20%30%40%0-2021-5051-100101-20 0201-400>400 RANGE (e xams pe r month)PrecentageA65 (33)A66 (23)A67 (31)Porter et al., 1997 SPECTRUM OF ANAESTHESIA UNIT USES urvey of 182 units0%5%10%15%20%25%30%35%0-2526-5051-1 00101-200>200 Range (times per month)PercentagePorter et al., 1997 NOS. OF OPERATING ROOMS REQUIRED Nos. of working days/week6 Surgical operations/year6,500 Average no. of No.

8 Of operating sessions required/year4,333 No. of sessions/OR/week (6 work days/week)12 PPM (done on day 7 ):sessions off/week/OR1 Available sessions/week/OR11 Additional sessions/week 12(with 1 OR reserved for emergencies) Working weeks/year50 Estimated Nos. of ORs needed(rounded up)9 EFFICIENCY IN USE OF OR EQUIPMENTNo. of ORs Required Vs Operations Load(assuming 3 op s/OR/day , 300 day s p er y ear)024681012140200040006000800010000 Numbe r of ope rations pe r ye arN o . o f O R s ne e de dNumber of ORs requiredY2005 Projections for DHB Hos pitalsPorter et al., 2003 INEFFICIENT USE OF OR EQUIPMENTNo. of ORs Required Vs Operations Load(assuming 3 op s/OR/day , 300 day s p er y ear)024681012140200040006000800010000 Numbe r of ope rations pe r ye arN o.

9 O f O R s ne e de dNos . ORs requiredY2005 DHB Hos pitalsUK: et al., 20032. TYPES OF TECHNICAL SPECIFICATION1. Functional- those which define the function or duty to be performed by the product2. Performance- those which define the performance required of an item3. Technical- those which define the technical and physical characteristics of an item in terms of such things as physical dimensions, power input and output, number of knobs and dials, their location and purpose, the materials to be used SPECIFICATIONSF unctional and performance specifications are preferredbecause they: encourage other parties ( a manufacturer who may be more expert) to offeralternative innovative solutions; discourage bias; minimise resources and effort to prepare the specification; reduce resources required by suppliersto prepare detailed responses.

10 Focus on results, not on technical INFRASTRUCTURE PROJECTP roduct resulting from a strictly technical specificationSource : OT, Genesis 6:14-16A MORE RECENT DEVICE PROJECTP roduct from a functional-cum-performance specificationSource : O. Wright, 1907 3. RISKS TO BE ASSESSED economic lifetime (based on experience) repair Vs dispose decision criteria environmental impactObsolescence & Disposal security of operating budget HR diligence in operation, care & records quality of support services (incl. measures)Operation & Maintenance transparency of processes bid evaluation methodology quality of DEVICES & workmanshipProcurement & Acceptance reliability of MANAGEMENT information business-case justification (where appropriate) efficacy & safety (HTA etc; latter ongoing) HR & infrastructure preparednessPlanningAGE SPECTRUM IN DEVELOPED COUNTRYLIMIT TO REPAIR COST AS % OF REPLACEMENT COSTN ormal Life-Expectancy of Device (yrs)789101215 Repair lifeLimit to Repair Cost as Percentage of Replacement (yrs)@ discount rate : , 20034.