Navigation Links
New Focus Placed on Alternative Financing as Hospitals Seek Competitive Advantage During Challenging Economic Conditions
Date:3/26/2009

Specialized Leases from Elekta Facilitate Sharing of Financial Risk and Return

ATLANTA, March 26 /PRNewswire/ -- Hospitals and health systems are facing a "perfect storm" as traditional financing options close, revenue is squeezed by layoffs and federal cuts, and investment income dwindles. Complicating the situation are competitive pressures, not only from other medical facilities, but from new entrants into the market such as standalone treatment centers.

Elekta Inc., an international leader in oncology and neuroscience solutions, is seeing new demand for its alternative financing solutions in this difficult economic environment. GK Financing L.L.C., a joint venture between Elekta and American Shared Hospital Services, provides alternative financing for projects involving Leksell Gamma Knife(R) and Elekta Axesse(TM) radiosurgery systems, including revenue-sharing and fee-for-service leases.

With GK Financing, a hospital does not own the equipment, but rather enters into a Services Agreement (the "Lease") and starts benefiting immediately from using Elekta's radiosurgery solutions. The Lease defines how revenue is shared, the obligations of the parties, and the options available to the hospital at the end of the Lease.

Tufts Medical Center in Boston partnered with GK Financing to install its Gamma Knife from Elekta. "At the time of our Gamma Knife installation, we were facing capital constraints and wanted a partner who could share the risk and help us upgrade the equipment when needed," says Denise Schepici, Senior Vice President of Clinical Services at Tufts Medical Center. "In light of the current financial crisis, we're glad we were able to spend less upfront and still offer the technology we needed to stay competitive."

"We began seeing an increase in interest in alternative financing over the past year, but it has accelerated since the credit markets tightened," says Craig Tagawa, who is Senior Vice President of American Shared Hospital Services and has served as CEO of GK Financing since its inception in 1995. "Using a service like GK Financing allows a hospital to obtain the equipment they need to provide the best possible care for their patients and remain competitive, without waiting - perhaps years - for the available capital."

Mr. Tagawa goes on to cite a number of forces creating financial difficulties for hospitals. "Hospitals have seen their investment portfolios decline, potentially creating debt covenant issues, which could impact their access to capital. We're also seeing hospital margins coming under pressure due to an increase in uninsured patients, in part due to rising unemployment."

Hospitals have traditionally had a number of sources for capital, but bank loans and credit lines have become increasingly difficult to obtain. And a study by the Financial Leadership Council of The Advisory Board Group showed that the yield on A-Rated, tax-exempt hospital bonds has jumped from 5.25% in December 2007 to 8.50% (as of December 19, 2008). Little wonder, then, that financial challenges continue to rank Number 1 on the list of hospital CEOs' top concerns in 2008, according to the American College of Healthcare Executives' (ACHE) annual survey of top issues confronting hospital CEOs.

Turning to alternative financing can offer benefits for everyone involved, says Mark Symons, Senior Vice President of Elekta's Neuroscience business unit. "This approach to financing new services can add a useful component for managing a hospital's total investment risk. If they are risk averse and/or access to capital is limited, alternative financing lets hospitals implement a service when they - and their patients - need it."

Note: This is the second in a three-part series on how hospitals are exploring financing alternatives and/or leveraging current assets to maintain a competitive edge. For the complete series, visit Elekta.com

About Elekta Elekta is a human care company pioneering significant innovations and clinical solutions for treating cancer and brain disorders. The company develops sophisticated state of the art tools and treatment planning systems for radiation therapy and radiosurgery, as well as workflow enhancing software systems across the spectrum of cancer care. Stretching the boundaries of science and technology, providing intelligent and resource-efficient solutions that offer confidence to both healthcare providers and patients, Elekta aims to improve, prolong and even save patient lives, making the future possible today. Today, Elekta solutions in oncology and neurosurgery are used in over 5,000 hospitals globally, and every day more than 100,000 patients receive diagnosis, treatment or follow-up with the help of a solution from the Elekta Group. Elekta employs around 2,500 employees globally. The corporate headquarter is located in Stockholm, Sweden, and the company is listed on the Nordic Exchange under the ticker EKTAb. For more information about Elekta, please visit www.elekta.com.


'/>"/>
SOURCE Elekta Inc.
Copyright©2009 PR Newswire.
All rights reserved

Related medicine news :

1. ImQuest Presentations at Keystone Symposium Focus on Advancements in Their Therapeutic and Microbicide Development Programs
2. Blue Cross and Blue Shield of Texas Sponsors Bridges to Excellence Program, Focusing on Quality Management of Diabetes
3. Focus on treating malnutrition in cancer patients, researchers say
4. Poniard Pharmaceuticals to Focus Company Resources on Late-Stage Oncology Candidate Picoplatin Through Realignment of Research Organization
5. Maryland We Work for Health Calls on Elected Officials to Focus on Medical Research and Innovation to Bolster Economy and Find Cures
6. National Hispanic Medical Association Conference in NYC Focuses on Increasing the Latino Health Care Workforce
7. Salt in Processed Foods Focus of the 7th National Forum on Heart Disease and Stroke Prevention
8. Society for Adolescent Medicine Meeting to Focus on E-Teens and How Adolescents Incorporate Technology and Health
9. High Intensity Focused Ultrasound Physician Training Seminar in Mexico City
10. NeuroFocus Expands Into the UK and Europe Through Acquisition of Neuroco
11. NFIB and AHIP Urge Focus on Affordable Health Care for Small Businesses
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:10/13/2017)... ... October 13, 2017 , ... Global Healthcare Management’s 4th Annual Kids Fun ... NJ. This free event, sponsored by Global Healthcare Management’s CEO, Jon Letko, is ... is geared towards children of all ages; it is a non-competitive, non-timed event, which ...
(Date:10/13/2017)... ... 13, 2017 , ... “The Journey: From the Mountains to the Mission Field”: ... souls in the Philippines. “The Journey: From the Mountains to the Mission Field” is ... Bible. She has taught all ages and currently teaches a class of ladies at ...
(Date:10/12/2017)... ... October 12, 2017 , ... Planet Fitness, one of the ... today its plans to open a flagship location in Covington, LA at 401 N. ... To Go store next to Office Depot in the Holiday Square shopping center. Its ...
(Date:10/12/2017)... ... 2017 , ... Asante, a nationally recognized health system in ... existing home health joint venture through an agreement, effective October 1, 2017, to ... home health company with Asante, delivering clinically integrated care, for the past eight ...
(Date:10/12/2017)... ... October 12, 2017 , ... Leading pediatric oncology experts at ... for the 49th Congress of the International Society of Paediatric Oncology (SIOP) ... Center for Cancer and Blood Disorders at Children’s National, and Stephen P. ...
Breaking Medicine News(10 mins):
(Date:10/11/2017)... -- Caris Life Sciences ® , a leading innovator in ... medicine, today announced that St. Jude Medical Center,s Crosson ... as its 17 th member. Through participation with ... Institute will help develop standards of care and best ... cancer treatment more precise and effective. ...
(Date:10/10/2017)... , Oct. 10, 2017  NDS received FDA 510(k) clearance in ... medical-grade battery-powered display stand specifically designed for endoscopy environments. An innovative ... into a clinical solution to support the improvement of patient outcomes, ... Design ... Solution ...
(Date:10/5/2017)... Oct. 5, 2017  In response to the ... and Maxillofacial Surgeons (AAOMS) released prescribing recommendations that ... be used as a first-line therapy to manage ... Recognizing the value and ... Paper "Opioid Prescribing: Acute and Postoperative Pain Management" ...
Breaking Medicine Technology: