Whose Generator Is It Anyway?

Hospitals Push Back at Vendors Treating Hospital Equipment as Their Property

Hospitals live on a tight budget these days. Many of them rely on programs such as single-use device reprocessing to remain profitable in – for example – cardiology labs. Such programs can yield $500K or more in savings per year and make the difference between profitability and loss. And yet, we see device vendors using questionable tactics to stop hospitals from realizing these savings. This is nothing new. What’s new is the nature of the deceit, which has now evolved to a point where some vendors manipulate equipment owned by the hospital – without the hospital staff’s knowledge – to block savings from reprocessing.

In a recent example of this, a device vendor rolled out a national initiative to have its reps enter Electrophysiology labs and perform an upgrade to the generator (the HOSPITAL’s generator) that rendered the use of reprocessed devices with that generator impossible.

What our partner hospitals experienced was that the vendor reps installed the software upgrade without notifying the staff that the upgrade was performed or that it would stop savings from reprocessing. In some cases, reps informed staff after the fact. In other cases, staff would realize the effect when they tried to use a reprocessed device.

While software upgrades happen frequently and usually represent improvements to functionality or bug fixes, our partner hospitals have not been able to learn from any reps that this particular software upgrade does anything else to the functionality than to block their savings. In fact, some vendor reps directly told staff that this was the purpose.

This is a disturbing development, but unfortunately not too surprising. It follows a familiar trend in hospitals where vendors have developed such familiarity with the labs and the staff that they pretty much go where they want, when they want – and do what they want. I know of no other market than healthcare where this happens. It’s like me walking into a store, letting the clerk hand me whatever he wants to get rid of, then taking whatever amount of money from me he wants. In normal markets, this doesn’t happen. In healthcare, hospitals are letting the fox into the henhouse – unsupervised.

...vendors have developed such familiarity with the labs and the staff that they pretty much go where they want, when they want – and do what they want.

This may be a “normal” pattern in healthcare, but that doesn’t make it OK. And when the abuse gets to the point where vendor reps are manipulating hospital-owned equipment to block critical savings for hospitals that are struggling to survive, something must change.

Fortunately, in this particular situation, we have seen hospitals react with more resolve – and anger – than we have seen in the past, sending the signal that, “enough is enough”. Across many of our hospital partners, vendor reps were told that the hospital wasn’t interested in the upgrade, since they needed to protect their savings. In a few cases, one generator was upgraded to block the use of reprocessed devices, while staff stopped the rep from upgrading another. These have only lost half their savings.

...vendor reps were told that the hospital wasn’t interested in the upgrade, since they needed to protect their savings.

Another hospital staff told us this: “Our vendor rep recently conducted software updates on some of our generators. This blocked reprocessed [devices] from being used. I recommend you talk with your vendor rep before any updates are performed and ask them two questions: The first question needs to be “Will this impede our ability to reprocess?” The second questions should be, “What are the patient benefit to this software upgrade?”

Hospitals own their generators and consoles. The vendors don’t. Thankfully, many of them are now insisting that the equipment is theirs and that vendor reps cannot manipulate them without informing the hospital and without learning what the consequences are of such manipulation.