leasing financing – healthcare

Please provide 3-5 sentences on the discussion below. Please follow APA and use peer-reviewed resources. Thank you!

In the article titled, “Weighing the benefits of buying versus leasing medical equipment,” Ed Rabinowitz (2016) explains the advantages of leasing medical equipment. And it’s not just him who feels that way, almost seventy percent of equipment is either leased or financed in some way. One of the main reasons for people leasing is that medical equipment is overly expensive. It is very hard to budget for medical equipment as other bills need to be paid for the facility to keep running. Another benefit with leasing is that you pay for what you use. This is unlike a car that you purchase as it loses its value once it leaves the lot. However, leasing instead of buying a car is very similar to leasing medical equipment. With a leased car, people don’t have to worry about costly repairs under 36k miles and give it back once the lease is up. They aren’t stuck with depreciation. It’s a similar mentality with doctors and their equipment as they don’t have to deal with repairs of costly equipment that can affect their facilities day-to-day operations. For example, if a piece of equipment goes down, the office can’t bill for those services and loses money. There also might be the possibility of down time for clinics to gather finances and resources to get the equipment fixed. Normally medical machines are covered under warranty or extended warranty and someone will come to repair it mediately when it isn’t working properly. And like cars depreciating, medical equipment depreciates too. Medical equipment is typically leased for three to five years and this keeps physicians current with the latest technology. They can swap out their old equipment that is innovating and new. This can be appealing for potential patients as they see these facilities with new equipment as the cream of the crop. They view these facilities as being the best simply because they have shiny new equipment, while neglecting the other factors that impact the quality of care. And just like patients, new equipment can also attract doctors because doctors want the newest equipment to work with as well since it makes their jobs easier.

Rabinowitz, E. (2016, October 10). Weighing the Benefits of Buying Versus Leasing Medical Equipment. Retrieved May 17, 2018, from http://www.mdmag.com/physicians-money-digest/columns/financial-health-check-up/10-2016/weighing-the-benefits-of-buying-versus-leasing-medical-equipment

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