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CAPITAL INVENTORY AUDIT

When was the last time your hospital conducted a fixed asset inventory?  Many hospitals conduct annual inventories on supplies and pharmaceuticals but overlook the savings potential of improving their capital asset ledgers. Did you know that inventory audits and reconciliation of capital assets in the hospital is recommended every 3-5 years? Here is why…
Your hospital’s capital assets (clinical equipment) represent the largest investment that hospitals & health care systems make. Yet, many hospitals rely on outdated ledgers generated from multiple departments to track their assets. It is important to note that departments must not only track equipment that is used daily, but also assets that may be stored in vacant rooms, storage areas or offsite warehouses. Over time accounting ledgers become compromised because of breakdowns that exist when new equipment enters the facility and old equipment is removed from service. The accounting ledger becomes inaccurate unless the hospital has a system in place for implementing a capital audit and conducting ongoing reconciliation of their asset ledger.  Also required, a policy outlining proper protocol for additions and deletions to the ledger when equipment enters or leaves the property.  

What hospitals may not realize is conducting a capital inventory can yield substantial tax & insurance savings in depreciation deductions. Just a little bit of planning can go a long way come tax time. If assets are no longer in service and not removed from the property, hospitals continue to pay property taxes and insurance on these assets. This does not account for the cost of square footage these items are impacting as well.
Consider the “ghost assets” that may be at your property. Every hospital and health system has equipment that may be lost, stolen, unusable, or no longer on the property. If your hospital does not conduct an inventory on a regular basis, these items may still be listed as active assets on the accounting ledger.  

According to a national news report, there are 5 ways in which hospitals suffer from inaccurate asset records:
1)     Paying to insure non-existent capital assets
2)    Carrying excess accumulated depreciation
3)    Asset control
4)    Unrecorded assets
5)    Lack of valuable resources and expertise

On average, companies are overpaying taxes on approximately 12% of fixed assets recorded on their ledgers. The savings that can be obtained from hiring a company to conduct a fixed assets inventory can more than justify the savings obtained on an annual basis. 
TRADING IN EQUIPMENT? Find out the fair market values with Appraise Now!



Appraisal of the Month
Samsung HM70A ultrasound Probes: LA3-16AD/CA1-7AD/EVN4-9
Fair Market Value: $25,000.00.

MRG Projects
I&A Service of EMS Group, PA
Resale Service for Tourniquet Change-out, OH
I&A Service for Multiple Heart Group’s, MI
Virtual Audit Urology Group, MI
Surplus Warehouse Cleanout, MI
Fun Fact
Did you know that Memorial Day was originally called Decoration Day. To honor the deceased, soldiers would decorate graves of their fallen comrades with flowers, flags and wreaths. Hence Decoration Day. Although Memorial Day became its official title in the 1880s, the holiday wouldn’t legally become Memorial Day until 1967.
“Helping to assess, inform, and empower healthcare providers with their equipment management needs.

For more information on MRG’s services, visit our website or contact us at
(440) 289-6490 www.go2mrg.com.
Manage Resource Group, Inc.
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COVID 19 Impact on Primary Care Practices

Independent Primary Care Physicians and Nurse Practitioners are on the front lines of healthcare providers battling the COVID 19 epidemic.  Many of these practices see first-hand the long-term effects COVID 19 has place on their patients, practices, employees and financial stability.

The Urban Institute conducted research on these challenges and area’s that directly impact the long-term needs of independent primary care practices:

https://www.rwjf.org/en/library/research/2021/02/impact-of-the-covid-19-pandemic-on-primary-care-practices.html

  • Increase reimbursement for telehealth services and the CARES Act’s Paycheck Protection Program enabling them to retain staff and remain open.
  • The federal Provider Relief Fund did little to help independent primary care practices as a majority of those dollars were directed to hospitals and large health systems.
  • Access to PPE has been a continual challenge for primary care providers, along with clinical hurdles associated with COVID-19 testing.  
  • Anxiety, burnout, and depression continue to negatively impact many primary care practices.

PPE and Telemedicine are top priorities when targeting challenges for these practices.  For more detailed information download the PDF in the above link.

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Manage Resource Group, Inc.

As the healthcare industry continues to see consolidation, health systems are increasingly looking for capital group buy opportunities and standardization of capital purchases across their network of hospitals.

If your system is looking at group buy opportunities or streamlining clinical technology across the organization’s equipment fleet, Manage Resource Group’s consulting service increases return on investment for displaced assets/systems.

  • Fair market valuation of capital assets & systems displaced by new purchases
  • Trade-In validation on OEM credits for new purchases
  • Turn-key project based sale of assets impacted by new purchase
  • Transparent sale process
  • Net returns up to 90 percent from sales of impacted equipment/systems
  • Secure payment (money in hand before assets are removed from property)
  • No shipping, material handling or warehouse fees

Our team of professionals bring more than 40 years of experience working with providers to assist with capital valuation and reselling assets impacted by group purchases and technology transition.  We will generate the highest net returns for your organization in a safe and transparent manner.  

  • Sechrist 3600H hyperbaric chambers project generated $81,980.00 gross sales, net return to client $73,790.00
  • Medex/Alaris pump project generated $640,000.00 gross sales, net return to client $576,000.00
  • Medrad injector project generated $159,000.00 gross sales, net return to client $143,100.00
  • Olympus scope project generated $154,340.00 gross sales, net return to client $131,189.00
  • Mizuho surgical table project generated $59,000.00 gross sales, net return to client $53,100.00

To learn more about MRG’s services call one of our sales consultants at: 

888/557- 4797 or Email us at info@go2mrg.com

 

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January 2021 Newsletter

HAPPY NEW YEAR!

M&A Leasing your practice

There are many reasons and benefits to leasing or structuring a timeshare for your practice. The tricky part is navigating the compensation arrangement to protect your interests as a business owner and maximize returns for your practice. Here’s what you need to know:

Set in advance the premises of the arrangement

  • Timesharing grants a license, or permission, to the lessee to use space or equipment instead of possessory interest, with the leaser remaining in control of assets
  • Determine which resources are going to be shared with the lessee, how often these resources are shared, and for how long
  • Equipment, space, staff, items, supplies, and services should all be covered in this part of compensation negotiations
  • What type of lease is structured (capital or operational)

Appraising your assets

  • Timeshare compensation must be consistent with fair market value (FMV) and exclude volume and value of patient referrals
  • Get an accurate appraisal of fixed/capital assets (equipment), real estate (space), and business costs (staff and services) to know what you should be asking for in terms of compensation
  • Accurate appraisals of assets, with a timeshare or lease arrangement, helps avoid the high valuations of property and assets that generally deter a health system from making an acquisition
  • Create a detailed report outlining demographics for all the assets
  • Apply Uniform Standards of Professional Appraisal Practice (USPAP) when appraising assets

Determining compensation

  • Stark law exemption only covers flat-fee or time-based compensation to avoid incentivizing overutilization and patient steering
  • Use this in conjunction with the FMV of your assets to know how much to ask for in compensation negotiations with the lessee.
  • Note that AHA is currently pushing for Stark Law reform and exceptions to better accommodate a coordinated, value-based care model and promote a team environment, so keep an eye out for these changes and how they may affect your arrangement

Working out leasing arrangements can be grueling and confusing for some.  Getting a better understanding of how much your interests and assets are worth can help protect your business and foster better relations with the health systems you’ll work with. To learn more about asset appraisal, go to:  www.medicalequipmentservice.us/appraisal

Appraisal of the month:

Samsung HS60 Ultrasound system with probes/peripherals

FMV: $29,000.00

Projects:

  • I&A Family Medicine Practice located in MI
  • I&A OBGYN located in OH
  • De-Installation and Sale of 2qty Nuclear Camera’s in KY
  • Purchase and removal of Sleep Lab in MI

        Fun facts:

The name for January comes from the Roman god, Janus, who is always depicted with two heads. He uses one head to look back on the year before, and the other head to look forward into the New Year!

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MRG’s E-Valuation

Some health facilities are limiting access for vendors due to COVID concerns, but that doesn’t have to prevent you from selling your used and no longer needed medical equipment.
Our free E-Valuation tool can help you with identifying value on your surplus without the need for an onsite visit. Using your PC or mobile device, you can get an offer for your equipment in only 3 easy steps. Check out this video for a quick tutorial:
https://www.youtube.com/watch?v=qOpYl49QZyo&feature=youtu.be
Start an E-Valuation
“Helping to assess, inform, and empower healthcare providerswith their equipment management needs.”

Featured

November 2020 Blog – MRG’s Inventory and Appraisal Services

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Inventory & Appraisal projects have been active this year due to the impact of COVID 19 on independent practices.   MRG has engaged in onsite, virtual, remote and desktop audits to complete I&A engagements.    Utilizing MRG’s proprietary Appraise Now™ Inventory Module that captures demographics and condition associated with each asset and MRG’s Appraise Now™ Blue Book a historical database of capital equipment that includes 10 years of data and more than 140,000 appraised assets, MRG was able to provide comprehensive deliverables accurately and efficiently for our clients.   

From acquisitions to liquidating an underperforming entity, identifying the value of medical equipment and other assets is crucial to any healthcare project.   Following are a few examples of when equipment inventory & appraisals are needed: 

  • Insurance purposes:  equipment may need valuation for future policies or claims.
  • Mergers & acquisitions:  needed to properly value assets bought or sold
  • Liquidation & bankruptcy: necessary any time creditors are involved
  • Partnership separation: objective view assisting with buyout negotiations
  • Leasing/buy-outs: for market value at end of term
  • Management & planning: understanding equipment’s value prior to replacement
  • Finance & tax purposes: current market value against book/equipment life and depreciation values

Third party inventory & appraisal services offer many benefits that can be leveraged in project engagements.   Contact one of our professionals to answer questions regarding inventory & appraisal services.  888/557-4797 or email: info@go2mrg.com

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MRG Newsletter November 2020

The COVID-19 Impact on Healthcare M&A

Now that the coronavirus pandemic has hit the American healthcare system with a slew of clinical and financial challenges, it is time to reconsider the strategy for mergers and acquisitions among health facilities. Health system physician acquisition was a trend on the rise in recent years, and now that trend will skyrocket as physicians are challenged by managing their offices in a post-COVID world. The good news is that this presents plenty of business opportunities for health systems looking to expand their presence in local markets. What kind of changes will each side need to make in their M&A strategy? 

Health Systems:
More physicians are in a place where they are willing to sell, but how do you know if they will be a good fit for your organization? This is the time to buy, but not without first understanding the current market and potential challenges in the acquisition process. When targeting a practice for acquisition, you need to:

  • Have clearly defined goals you wish to achieve with your M&A strategy (geographical presence, reduced supply expenses, increased care coordination, etc.)
  • Effectively communicate expectations of physician employment and how their integration aligns with the values of the health system
  • Cater your offers to not only the asset value of the practice but also to address individual physician needs to come to a mutual agreement

Physicians:
Financial security is now the number one reason physicians seek employment, but many are reluctant to do so at the expense of their autonomy. You may be at a financial disadvantage, but do not let that get in the way of protecting your interests as a health practice and potential employee. When looking for a buyer or merging organization, be sure to:

  • Understand and explore nonconventional partnership options with varying degrees of physician independence and flexibility – timeshares, venture agreements, minority investments, etc.
  • Know the worth of your assets and clinical network contribution (i.e. patient volume and revenue) to avoid accepting lowball offers
  • Clarify your expectations as a prospective employee and how your practice can contribute to the buyer’s clinical strategy

The ongoing pandemic is forcing healthcare providers to reassess not only their financial interests but how they can cooperate to better serve their communities. Most M&A activity that leads to buyer’s remorse and dissatisfaction is due to incompatible cultures. The biggest change needed for both sides is to communicate their most important clinical expectations with candor and engage in a strategy that optimizes the mutual benefits of physician acquisition.


MRG Appraisal of the Month:

2020 GE OEC Elite GSP C-ARM
w/ dual monitors

FMV: $120,700.00


MRG Projects:
– Virtual I&A for 2 Surgery Centers in AZ
– Desktop Appraisal Diagnostic Imaging Clinic in CA
– Onsite I&A Project for Family Health Group with 4 locations in TX
– Remote I&A service for Orthopaedic & Spine Practice in MI
– Onsite I&A Project for OBGYN Practice in KY
– Onsite I&A Project Urgent Care Clinic for MI Health System


Hospital Fun Fact:
Europe’s first facility specializing in the treatment of mental illness was London’s Bethlem Royal Hospital. It was infamous for its inhumane practices and became the definition of insanity – The word “bedlam” is derived from “Bethlem.” The hospital was a leading tourist attraction for more than a century, drawing curiosity seekers who wanted to get a first-hand look at its patients, their behavior and living conditions.

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Introducing the New and Redesigned Appraise Now

Manage Resource Group has redesigned our Appraise Now™ portal to better assist
our customers with their equipment appraisal needs.
Is your annual budget up for approval?
How will you handle equipment impacted by
new purchases? 
MRG’s Appraise Now is a secure web-based solution to questions surrounding fair
market value for capital assets. Whether you’re trading in or looking to sell, make the most of your decommissioned medical equipment.
How does it work?
Sign up for an account and receive your first appraisal FREE. Once registered, you can submit appraisal requests any time:
Let us know how we can contact you
Tell us all about the asset you need appraised
Provide as much information as you can to ensure an accurate quote.
You’re done!
Submit your appraisal request and get a quote on your capital equipment within
24-48 hours from time of submission.