Sometimes it’s more cost effective to lease medical equipment than to purchase it. For example, medical equipment leasing might save money in the long run if you expect a particular device to become technologically obsolete in the next few years and you want to ensure that you continue to use state-of-the-art equipment. It can also make sense to lease medical equipment if you don’t have the cash for a down payment on extremely expensive equipment that your medical practice requires.
Among the most common medical equipment lease financing options:
- A true lease (also called an operating lease). Your lease payments stay the same during the life of the lease. When this medical equipment lease ends, you return the equipment to the leasing company. It’s a good choice for equipment that might become outdated in the near term.
- A fair market value lease. When the lease period ends, you can purchase the equipment for its fair market value. If you expect the equipment to remain useful to your practice, this type of medical equipment lease financing can be a smart option. Just make sure that the fair market value is written into your lease contract.
- A $1 purchase option lease. You can buy the equipment at the end of the lease term for $1, with no additional charges. The IRS treats medical equipment rentals of this type like a loan so you can claim depreciation and interest expense deduction.
Action Steps
The best contacts and resources to help you get it done
Consult experienced medical equipment leasing companies
Look for medical equipment leasing companies that understand the technology and have good relationships with medical equipment manufacturers. When in doubt, ask the equipment manufacturer for a referral.
I recommend: Leaf Financial Corporation,
Bankers Healthcare Groupand
Henry Schein offer multiple medical equipment leasing options and experienced lease consultants. To brush up on equipment leasing terminology, consult the Equipment Leasing and Finance Association’s
equipment leasing glossary.
Check directories for more medical equipment leasing companies
There are scores of leasing companies that provide medical equipment rentals. Save yourself from hours of web surfing by consulting a directory.
I recommend: Locate members of the
Equipment Leasing and Finance Association of America who offer medical equipment lease financing by consulting the organization’s directory.
MD Publishing also offers a list of medical equipment leasing companies.
Lease medical equipment directly from the manufacturer
Many medical equipment manufacturers offer their own medical equipment lease financing programs.
I recommend: Among the many equipment vendors that will lease medical equipment directly to healthcare professionals, are
Philips,
GE Healthcare and
Steris.
Tips & Tactics
Helpful advice for making the most of this Guide
- When calculating the potential financial benefits of leasing medical equipment, take into account the additional personnel and supplies you may need to operate the equipment.
- Check your medical equipment lease agreement for so-called "evergreen" provisions. For example, if you decide not to purchase the equipment at the end of the lease but you don't give the leasing company enough notice, you could be obligated to continue leasing the equipment for several more months.
- If you don't have insurance for the equipment you're leasing, the medical equipment leasing company may include an insurance premium in your monthly payment total. They may also charge you an administrative fee. Confirm that the fee is reasonable.
The official source of Medical Equipment Leasing is
the Medical Equipment Leasing page at Business.com
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