Healthcare Organizations Confront Increasing Financing Challenges

A new survey shows an increasing demand for tailored financing from healthcare organizations purchasing or upgrading medical equipment and technology. The finding were reported by the Siemens’ Financial Services unit (SFS; Munich, Germany), an international provider of business-to-business financial solutions.

According to the survey, conducted amongst leading medical equipment manufacturers, the increasing funding difficulty has contributed to a growing demand for healthcare equipment finance over the last two years, resulting in the proportion of global medical equipment sales purchased through asset finance growing by an average of 6.9% annually. In all, 70% of survey respondents confirmed this trend, and over 60% of respondents believed that finance penetration will continue to rise over the coming two years.

Other underlying trends also emerged from the research; two thirds of respondents reported that their healthcare customers are feeling a squeeze on their capital budgets; 57% reported increasing demand for tailored financing to acquire new equipment; 64% also observed customers’ increasing application of total cost of ownership (TCO) methodologies in equipment acquisition evaluation. According to SFS, this reflects the demand for financing techniques that can embrace other associated costs (installation, service, life-time maintenance, upgrades, etc.), over and above the simple cost of purchase.

“Healthcare organizations around the world are laboring under increasing financial pressures. Constrained budgets, however, should not compromise diagnostic and clinical efficiency and accuracy, which can only be maintained through continuous technology investment,” said Chris Wilkinson, head of sales for healthcare and public sector for SFS in the United Kingdom. “Using sustainable financing techniques such as asset finance, healthcare organizations can afford essential equipment upgrades and replacement to deliver better diagnoses and improved health outcomes, despite budget pressure.”

The study was conducted on behalf of SFS by MindMetre Research (London, United Kingdom) among the global top 40 medical equipment manufacturers. Respondents were interviewed on their views in relation to recent trends in demand for asset finance from healthcare organizations worldwide, their future projections for this demand, and the country differences in demand for asset finance and its main drivers.

Related Links:
Siemens’ Financial Services unit
MindMetre Research