The Life Cycle of the Medical Equipment PURCHASING Heikki Teriö, Ph.D. Department of Clinical Engineering

1. The Life Cycle of the Medical EquipmentPURCHASINGHeikki Teriö, Ph.D.Department of Clinical Engineering

2. Medical Technology Management Need Management Market analysis Need analysis Preventive maintenance Corrective maintenance Safety assessment Economy Documentation Continuing education Procurement Technical specification Clinical test Control measurement Experience feedback Evaluation Delivery control Education Maintenance planning Registration Disposal Reserve Storage Spare parts Sale

3. Purchasing a function or a solution • From Vision • to Function

4. Purchasing a function or a solution • Vision • how will our work look like in 3, 5, 8 years • how will the medical methods be developed • how will the medical technology be developed • how will the economy of the health care system be developed

5. Purchasing a function or a solution • What we mean by purchasing a function or a solution • function of a piece of device • function of a system • function of an entire treatment room

6. Purchasing a function or a solution • We need a dialog between the different categories of staff from the very beginning. • This is extremely IMPORTANT!

7. Purchasing a function or a solution • The dialog between the different categories of staff must include: • how the equipment will be used • what special functions will be needed • what information is needed for the treatment – where can we find this information • what availability is needed • what environmental demands we can state • how are we going to maintain the function/equipment • how are we going to finance the function/equipment

8. Purchasing a function or a solution • The new role of the Clinical Engineering • Internal consult • technical knowledge • economic knowledge • medical knowledge • good ability to co-operate

9. The Purchasing Process

10. Commission Tender documents Opening the tenders Purchasing team Announcement Qualification/evaluation Selection of supplier Restart the process Appeal Appeal time 10 days Contract Follow-up Delivery control Delivery Payment

11. The Annual Purchasing at Karolinska • Total 237 M€ 21 % of turnover • Material 128 M€ • Medical equipment 34 M€ • Services 76 M€

12. Decision to Purchase • A formal decision to allocate money must be made by authorised person. • Specify the type of goods/services required. • Specify the estimated cost. • Also a formal commission to start the purchasing process.

13. Commission to the Purchase Department • The commission is registered and given an unique ID-no. • The purchasers are assigned commissions by the Purchasing Manager • Larger and/or unusual commissions are discussed within the group and sometimes assigned to a pair of purchasers.

14. Investment number • On all investments over 1500 € are assigned with the number • Follow-up of the investment from budget to the inventory register

15. Uppdrag Annonsering Underlag Grupp Öppning Utvärdering Överprövning Gör om upphandling Remisstid (10) dagar Avtal Besiktning Uppföljning Leverans Who is responsible for what? • Invitation to tender – Purchasing department • Specifications – User/Clinical Engineering • Contract terms – Purchasing department

16. Preparing the tender documents • The Purchaser contacts the end users and clinical and technical experts. • Together the group prepare the tender documents: • - Invitation to tender • - Requirements specification (LCC) • - Contractual terms • The Purchaser has the overall responsibility for the quality of the documents The demands on the product shall not be changed

17. Uppdrag Annonsering Underlag Grupp Öppning Utvärdering Överprövning Gör om upphandling Remisstid (10) dagar Avtal Besiktning Uppföljning Leverans Demands on the goods/servicein the invitation to tender • Explain all the demands that has to be full filled(goods, services, time schedule etc.) • Explain the demands as a goal, function or result when ever it is possible • Describe the demands so that they are measurable • Ask for the prise for all goods and services that will be included (service, maintenance, new versions, updaters etc.)

18. Environmental demands of the purchasing • Environmental demands are part of the hospitals environmental control system • Relevant environmental demands in central purchasing • There is also national recommendations for different types of medical equipment

19. Making the purchase public • The invitation to tender is advertised in the bi-weekly ”Anbudsjournalen” and their homepage. • If open procedure advertisement is made in EGT S/TED i Luxemburg. • Open procedure >EUR 200.000.

20. Companies who see the advertisement and are interested contact the purchaser and request the documents. Sometimes we contact companies and ask if they are interested to ensure competition. The purchaser distribute the documents via e-mail or regular mail. In the future the documents will be made available on our external web. Clarifications are distributed to the companies usually via e-mail Distribution of the documents

21. Opening the tenders • The tenders must be clearly marked • At least two (2) persons must be present at the opening and sign each page • Copies are distributed to end-users, experts etc.

22. Qualification and evaluation • The purchaser check the tending company and contractual terms. • The purchaser make a price/cost evaluation. • The end-users and experts check how the tender meets the requirements specification. • The tenderer might be given a chance to clarify their tender. • Evaluation is made – different methods

23. Uppdrag Annonsering Underlag Grupp Öppning Utvärdering Överprövning Gör om upphandling Avtal Besiktning Uppföljning Leverans Evaluation • Lowest price • OR • Economically most preferable • Ergonomics • Quality • Price • Functionality • Environment • Give the weight / share in the process

24. Selection of supplier(s) • After evaluation we decide on one or more suppliers. • The reason for the selection must be documented and based on the requirements and criteria stated in the tender documents. • All tending companies are informed about which company was selected and why. They can appeal against the decision within 10 days.

25. Contract • Any open issues in the contract is discussed and final terms agreed. • The contract is sent to the supplier for signature. • We return a signed copy after the 10 days waiting period. • Copies of the contract are distributed to the clinic, Clinical Engineering Department and the Financial Department

26. Delivery of the goods • All deliveries are made to the goods receipt area. • The goods passed on to the Clinical Engineering department for delivery inspection. • After approved delivery inspection the equipment can be put to use and the warranty time starts.

27. The contract is entered into a database for future follow-up. All original documents are archived and kept for minimum 2 years. Decisions and contract for ever. Follow-ups Signing service contract after the warranty. Price adjustments. Prolonging the contract. Checking the financial status of the supplier and how they perform. Termination and follow-up

28. Buyer handles the free text order The users order through the database or by writing free text Electronic authorizing Clockwork logistics Central creation of the orders to the distributor through EDI or automatic fax Faktura Invoice control at the dept. of Economics. Received - Payment The barcode is read at the delivery centre Received at the clinic

29. Current problems • Lack of discipline – respect for the law. • Short planning horizon – no understanding for time consuming process. • Purchases are getting more complex; technically, financially and legally. Competence must be constantly improved. • The law, ”LOU” develops in the wrong direction – detailed regulations instead of framework guidelines. • New, ”political” criteria, e.g. environment, equality, social justice • Acceptance for the e-purchase system - conservatism.

30. Smart Buy in the County Council, SMIL • Increase the co-operation within the county council • Large volumes give better prizes and functionality • Better knowledge give better terms • Less suppliers give better terms • Guaranteed volumes give better terms

31. SMIL • Steering group with county and hospital directors • Project group with purchasing managers meets every 14th day • User engaged via reference groups • New way of purchasing • 2 new analyzer positions to the county council

32. Thank you for your attention