Siemens: Increasing Demand for Healthcare Equipment Finance

New research from Siemens’ Financial Services unit (SFS) shows that finance is playing an increasingly important role in enabling medical equipment acquisition for healthcare organizations around the globe.

Siemens said according to the study among the global top 40 medical equipment manufacturers, close to 70% of respondents had seen an increasing demand for healthcare equipment finance from their customers over the last two years. During this period, the proportion of global medical equipment sales financed has grown by an average of 6.9% annually. Over 60% of respondents believed that finance penetration will continue to rise over the next 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 and 57% reported growing demand for tailored financing for healthcare organizations to acquire new equipment. In particular, demand is increasing for tailored monthly finance payments (grace periods) to help meet expected project cash flow/financial return objectives, financing end-to-end clinical or diagnostic processes.

Gary Amos, head of Commercial Finance – Region Americas, commented, “In the US, intensified competition between healthcare providers is driving the need for greater investment in up-to-date medical equipment in the battle to win patients. However, budget constraints mean that many healthcare organizations are limited in their ability to make essential equipment upgrades and replacements. Using sustainable financing techniques such as asset finance, healthcare providers can undertake medical technology investment to improve clinical efficiency and accuracy despite financial pressures.”

Another common observation from respondents was a change in the approach to making equipment acquisition decisions among all healthcare institutions across the world (public and private). There appears to be a gradual shift in investment decisions away from clinicians to finance professionals (e.g., CFOs), except where technological advances make such a difference in performance as to offer major performance (diagnostic/clinical outcomes), productivity or safety increments.

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