Net Present Value: Achieve Your Highest ROI
The planning period for diagnostic imaging technology used to last several years, providing administrators a near guarantee that they would receive a positive ROI from purchasing a system.
However, today we face a healthcare market in flux due to rising consumerism, population changes and new policies and regulations. Advancements in technology can necessitate upgrades, and new regulations can render technology obsolete. These risks have narrowed planning periods for capital-intensive diagnostic imaging technology, leaving healthcare administrators to reevaluate procurement options
President and CEO
Many providers are being asked to seek asset procurement strategies that minimize financial risk. Hospital executives and imaging directors are thoroughly analyzing what potential revenue can be generated from their capital investments and weighing these projections against estimated costs.
Unfortunately, far too often, the analysis stops there. Hospitals often leave out the crucial step of evaluating all available procurement options, and they are unknowingly forfeiting significant cost savings. In this era of healthcare reform, where cutting costs is fundamental to survival, you cannot afford to miss out on a single penny.
So…how can you determine the most cost-effective procurement option?
Answer: Net Present Value comparative cost analysis
Net Present Value (NPV) calculates the present value of cash flows at the required rate of return of your project compared to your initial investment.
In simpler terms, NPV considers the value of money over time. By translating future cash flows into today’s dollars, managers can easily compare an initial outlay of cash against the present value of the return.
In planning and budgeting capital projects, hospital administrators and executives can apply this objective and accurate analysis to all procurement options to determine which option is the most profitable over the asset’s lifespan. Lease, purchase, or operationalizing assets – the Net Present Value of ALL procurement choices should be calculated and weighed against each other to make the most cost-effective decision for your facility.
Download our free eBook to help you better understand and analyze your options
Get the tools that will help you understand and analyze your diagnostic imaging procurement options, as well as their financial short-term and long-term implications. Fill out the form to download our eBook, Determine the Best Procurement Option for Your Imaging Assets and uncover the secret to saving money while gaining or improving imaging services.