By Frank Long
The following companies offer a range of products for capital expenditure purchases:
Bailey Manufacturing Company
Battle Creek Equipment
Biodex Medical Systems Inc
Bionik Laboratories Corp
Brookdale Medical Specialties Ltd
CIR Systems Inc/GAITRite
Clarke Health Care Products
Hausmann Industries Inc
Hudson Aquatic Systems LLC
LightForce Therapy Lasers by LiteCure LLC
Micromedical by Interacoustics
Pivotal Health Solutions
SureHands Lift & Care Systems
Tri W-G Inc
Money talks, and what it seems to be saying is that clinic managers these days are not only doubling down on facility-based equipment workhorses such as treatment tables and treadmills, but they are directing some of the greatest slices of their budgets to first-time purchases of new equipment. The trend suggests that fear of the untested has fallen off, which is a conclusion fairly well supported by the responses our readers provided in the Physical Therapy Products 2019 Facility-Based Equipment Survey. Those responses demonstrate that, in the current economy, clinic owners are willing to lay out cash for more than just the purpose of replacing and maintaining existing equipment. The figures seem to signal that bringing new PT technologies on board will be an ongoing trend among clinics while conditions continue to ripen for an explosion in demand for services.
Why All the Fuss?
Growth indicators for the PT market can be found in projections from the federal government and public health sector. Among the data are recent findings from the Centers for Disease Control and Prevention that reveal 50 million US adults are affected by chronic pain. Likewise, a prediction by the American Academy of Orthopaedic Surgeons reports that total knee replacement procedures will grow by up to 189% in the next 10 years. Treatment for chronic pain and joint replacement account for a substantial portion of PT care, and the data suggest pain relief will be in great demand.
Another indicator is the number of physical therapists entering the workforce, which the Bureau of Labor projects will grow at a pace of 28% through 2026. This inflow of therapists will expand service capacity and ultimately blow up equipment purchases for tools that will be placed into those therapists’ hand. The mathematics behind these numbers add up to an expansion in the market that should be sustained for some time to come. The takeaway these data points sketch out is perhaps best summed as “buy bold and buy now.”
Before a clinic lays down cash for a capital equipment purchase, it oftentimes will establish a budget for such purchases. Not all of a clinic’s significant purchases during a 1-year period are pre-planned, but this year’s survey respondents budgeted for facility-based equipment in the greatest numbers since at least 2012. Among this year’s survey respondents, 90.9% indicated they budgeted for facility-based equipment, compared to 84.4% in 2018, and only 73.4% in 2012.
And, it seems clinic decision-makers are more inclined than ever to fund equipment budgets as they have been requested, with 88% of this year’s survey-takers reporting that the budgets they asked for had been approved. This measure stands in contrast to last year when 78.6% survey participants reported their budgets had been approved, and represents a substantial increase over 2012 when only 64.5% of those who requested budgets had them approved.
Budget amounts provided a particularly interesting data point from this year’s survey. The results from this year’s polling indicate that 2019 is the year clinic owners and managers decided it’s hip to spend big. In response to the question, “What was your total budget amount?” 36.4% of those who participated in this year’s survey reported amounts of $10,000 or greater. That figure is nearly double the 18.6% of survey respondents in 2018 who reported budgets of the same amount. Likewise, the figure reflects a continuing climb upward from the 2017 survey, in which 22.2% of respondents reported a total budget amount of $10,000 or more.
Inside the Shopping Cart
Picking winners for this year’s survey was problematic, with three equipment types edging each other out by barely more than a nose. This purchasing activity is further evidence of a healthy marketplace for consumers, clinics, and manufacturers, that also leaves open the possibility for a breakthrough technology to emerge as a front runner later this year. One type of equipment clearly held the lead, however, by the time this 2019 survey closed: treatment tables were the facility-based equipment in which clinics most often invested their dollars, with 34% of participants indicating their practice had made such a purchase.
Trailing closely as some of 2019’s most popular acquisitions were treadmills and gym equipment. Treadmills ranked second among our survey respondents, with 31.6% reporting that their clinics had made a treadmill purchase. Separated by only a slight margin, rehab and fitness equipment were nearly as popular, with 30.8% of survey-takers reporting that their facilities had purchased technologies such as pulley equipment or weight machines for the PT gym.
In every corner of the clinic practices appear to be making solid investments in facility-based equipment, with purchases that reflect demand for everything from pain relief technologies to software. Pain modalities were ranked fourth most popular among facility-based equipment purchases, with 28.6% of survey respondents reporting they had acquired a device from this category, while 25.7% of respondents selected software as one of their clinic’s facility-based equipment purchases.
Buying activity was also solid for gait and balance technologies, which were reported as purchases by 16.8% of survey respondents. Safe patient handling equipment was acquired by 14.7% of those who took the survey, while 12.8% indicated beds and mattresses as purchases made in 2019. Aquatic therapy is also an area where investment continues to grow, with aquatic equipment purchases reported among 9.1% of survey participants. Patient movable tables accounted for purchases in 5.4% of survey responses.
The Wish List
Although this year’s survey participants reported overwhelmingly (88%) that they received the budgets they requested, some of those budgets may have been trimmed for a variety of reasons in order to win approval. This year’s survey participants indicated that they ultimately came up short on several types of facility-based equipment for which they’d hoped to receive funding. For example, 36.4% indicated that treatment tables were still on their wish list, while 27.3% noted that rehab and fitness equipment remained on their wish lists. Software appeared on the wish list for 24.8% of survey participants, while pain modalities was noted by 22.3%, gait and balance equipment was named by 18.4%, and resistance equipment was marked by 14%. Safe patient handling equipment and beds/mattresses appeared on wish lists for 5.4% and 3.8% of respondents, respectively.
Tell Me Why
For those who are still on the fence about making additional purchases in 2019, or making any facility-based equipment purchases this year, it can be helpful to use the results of this survey to see the trends taking hold throughout the industry, and gauge whether they might apply to your own practice. While this survey provides a view of “what” equipment is being purchased, knowing the types of categories from which products are being purchased only partially informs a purchase strategy. To have a more complete understanding about purchase trends, it is vital to understand “why” purchases are being made.
To fill the “why” gap in the facility-based equipment purchase picture, the 2019 survey asked participants whether they were making purchases to upgrade equipment, replace it, or buy a product for the first time. This year’s survey found that first-time purchases surged ahead of previous years’ buying patterns, with 45.5% indicating their purchasing goals were directed at making a first-time purchase. That figure well exceeds the 35.7% who reported such intention in 2018, and 33.3% who responded similarly to this question in 2017.
Among this year’s respondents, 36.3% said that their purchasing goals had the aim of replacing equipment, while 18.2% reported that their goal was to upgrade equipment.
Happy Returns (on Investment)
Money, as it is said, makes the world go ‘round. While money as a philosophical concept will not be debated in this article, it can certainly be said that money is the lifeblood of equipment purchases and a reliable barometer for judging whether a purchase was a good idea. In this case, money—in the form of revenue—that is generated by an equipment purchase provides the crucial variable in determining return on investment (ROI). This survey was created not only to provide quantitative data for purchasing strategies, but to also to present qualitative data about brands and platforms that can serve as a launch point for product searches.
We asked our readers to help us understand which technologies specifically provided them the best ROI, and they had plenty of opinions to offer. The technologies they ranked at the top included laser equipment, CoolSculpting, Dynatron, software, e-stim/biofeedback devices, gait and balance devices, treatment modalities, and marketing tools. Looking ahead, our survey participants also told us they planned to make several facility-based equipment purchases in 2020 if they were not able to acquire them in 2019. Among them were aquatics equipment, marketing tools, software, and therapeutic technologies from Saebo.
Since purchases always begin with an idea about how to fill a need, our survey respondents also revealed where they turn to when they want to learn more about products and technologies for the physical therapy practice. When asked, “From what source do you get your product information,” survey-takers responded as follows: websites (81.8%), newsletters (45.5%), magazines/digital editions/media (36.4%), referral (36.4), social media (9.1%), word of mouth (9.1%), and employees (9.1%).
For some time after the 2008 financial meltdown it seemed that spending had all but been sucked from the lungs of clinic budgets, and appetite was slim for buying anything that didn’t directly contribute to keeping payroll covered. Those days of belt tightening are now a distant blip in the rear-view mirror, and the future seems as if it will serve up demand for PT fat with an apple.
And, there are still variables that may drive even more patients and clients into the PT clinic. It is hard to say exactly what some of those variables will be, but the therapy cap repeal in 2018 and marketing resources such as patient engagement tools may yet have an impact. Without a crystal ball, the best any clinic manager or owner can do is to look hard at their own clinic’s data, gather intelligence from colleagues and manufacturers, and, when in doubt, check the math and allow the numbers to show the way. PTP
Frank Long is Editorial Director of Physical Therapy Products. For more information, contact PTPEditor@medqor.com.