You can save a lot of money buying from on-line auctions, but is it a good idea?

Responses mixed to purchasing supplies, devices from web

The next time you need to purchase a laser, how would you like to pay $8,000 for a used one instead of $30,000 or $50,000-$100,000 to purchase a new one? Those were the options faced by one ophthalmologist who turned to the Internet when he needed a CO2 laser.

"It was used, but the seller stated that it had limited use," recalls Paul N. Rosenberg, MD, ophthalmologist at Ocusight Eye Care Center in Webster, NY, and clinical assistant professor of ophthalmology and plastic surgery at the University of Rochester (NY) School of Medicine and Dentistry. "I was interested in this particular laser because I already own the exact model that I use in one of my offices and was familiar with it."

The used laser was missing one additional feature, worth $5,000 at the time a new one had been purchased by Rosenberg about nine years previously. Interestingly, at the time Rosenberg purchased his used laser at www.OpticalAuctions.com, he was using a used laser, the same brand and model as the one on-line, on consignment from a vendor. "They wanted $30,000 for the used laser, which I felt was grossly overpriced," he says. The used one he purchased on-line worked well for about six months, then needed a repair on the laser tube for about $4,000-$5,000, Rosenberg says. "Despite this unexpected repair, we only had a total of about $12,000-$13,000 invested in the laser, which was much less than the cost of a new one, which can run $50,000-$100,000 depending on the make and model," he says.

Some on-line auctions do not charge fees for items listed for sale or items sold. They typically use a buyer-and-seller rating system.

Some health care providers use on-line auctions to get rid of surplus supplies and equipment. "Surplus has always been problem for hospital facilities," says Jim Stewart, president of The Granite Group, which buys and sells health care surplus equipment and supplies from its offices in Huntington Beach, CA. "Sooner or later, they realize it’s taking up a lot of space that can be used in productive manner." Also, it saves managers from going into "panic mode" when it’s time for an accreditation survey or regulatory inspection, Stewart says. His company pays from hundreds to thousands of dollars to remove surplus from a health care facility, he says. "Many facilities are uninformed of the level of surplus they really have, and what the costs are in storing or trying to preserve these items for later," Stewart says. "This is the old-school thinking and is a burden in today’s health care financial environment."

While equipment from The Granite Group is sold as-is, purchasers are buying items that are refurbished at a substantially lower cost than through conventional used/refurbished medical equipment dealers or original equipment manufacturers, he maintains. Buyers can save as much as 80%-90% off the price of supplies and equipment, Stewart says.

How to protect yourself

While some health care experts warn about the perils of buying items at on-line auctions, outpatient surgery managers who want to purchase items on-line may be able to protect themselves to a degree by following these suggestions:

• Know your equipment/supplies.

Purchasers shouldn’t go on a "fishing expedition," Rosenberg advises. "They should have a sense of the going price ahead of time because if there is an eBay-type auction, it is easy to get caught up in the excitement of the chase and overbid," he warns.

Pay attention to labels, the Food and Drug Administration (FDA) warns. "If the instructions are in many languages or if measurements are in S.I. (metric) units, the product may be intended for sale in another country, not the U.S.," the agency advises. "This can mean the product does not meet U.S. requirements and may be of inferior quality."1

The agency suggests that you ask the seller, "Has the FDA cleared or approved this product for sale in the United States?" Also, beware of sites that do not include an address and telephone in the United States, the agency warns.1

• Ask questions.

Feel free to e-mail sellers and ask questions, but realize that the web sites don’t monitor sellers to ensure they are answering questions honestly.

When Rosenberg was interested in buying a used laser on-line, he called the seller, a private ophthalmologist. "I questioned him quite closely about its condition and the number of cases it was used on, Rosenberg says. "While he offered no warranty beyond that it was working, I felt comfortable and wasn’t worried that another physician would cheat me, so to speak."

Given the high price of most of the items, it would be best if buyers speak directly to the sellers or least have some communication with them, Rosenberg advises. If buying used instruments, it is usually last year’s model, he says. "The seller is getting rid of it either because there is a newer model to which they are upgrading, or the technology is changing and they want to unload it, or it doesn’t do what they want it to," Rosenberg says. Also, it may be that the seller jumped on the bandwagon and no longer wants to offer a particular service, he says. Such a seller wants to recoup as much of their cost as they can, he says.

"So, you may be getting technology that is not the newest or greatest but therefore, you will pay less, so that everyone is happy," Rosenberg says. "That doesn’t mean that the technology is invalid."

The seller told Rosenberg he was auctioning the laser because he wasn’t using it. "Perhaps he was uncomfortable with the use of it or wanted a higher-end laser," he says. "Either way, it didn’t matter to me as long as it worked because I already owned the same laser and was very pleased with its performance, especially for the value."

Anyone buying devices on the Internet has to be aware that some of the goods may be stolen, expired, or otherwise in unusable condition, says a spokesperson for The Office of Compliance at the Center for Devices and Radiological Health in Rockville, MD. "The buyers can protect themselves by trying to verify the source of the device, asking what parts of the device were refurbished, whether all parts meet the specifications of the original equipment manufacturer, and whether the work is covered by a warranty," says the spokesperson, who asked not to be identified.

When buying from a hospital, ask for a copy of the maintenance and repair record on the device, sources suggest.

• Know that sellers fall under different regulations.

The Office of Compliance reports an increase in inquiries regarding the buying and selling of refurbished devices on the Internet, a spokesman says. The FDA does not require re-marketers of used or as-is devices to comply with the requirements of the various medical device regulations, says the spokesperson. "For example, they are not required to register their establishment with FDA or comply with the quality systems regulation," he says.

• Safeguard yourself.

Some dealers do offer warranties on refurbished items, says Peter Goldenberg, president and CEO of Concepts In Sight, which operates www.OpticalAuctions.com from its base in Boynton Beach, FL. Also, his company places the buyer’s funds into their escrow account until the buyer receives the items and verifies it is what was advertised.

"The important thing here is to question everything beforehand," Goldenberg says.

Reference

  1. Center for Devices and Radiological Health. Buying medical devices online. Accessed at: www.fda.gov/cdrh/consumer/buyingmeddevonline.html.

Sources/Resource

For more information on buying and selling on-line, contact:

  • Peter Goldenberg, President and CEO, Concepts In Sight, 12180 Dunhill Drive, Boynton Beach, FL 33437. Phone: (561) 752-3638, Fax: (561) 423-753. E-mail: info@opticalauctions.com. Web: www.OpticalAuctions.com.
  • Jim Keller, Vice President, Health Technology Evaluation and Safety, ECRI, 5200 Butler Pike, Plymouth Meeting, PA 19462-1298. Telephone: (610) 825-6000, ext. 5279.
  • Paul N. Rosenberg, MD, Ocusight Eye Care Center, Webster, NY. Phone: (585) 872-1300. E-mail: pnrmd_ocusight@yahoo.com.
  • Jim Stewart, President, The Granite Group, 21561 Surveyor Circle, Huntington Beach, CA 92646. E-mail: jds@granite-grp.com. Web: www.granite-grp.com.

For information on devices that have been cleared or approved for marketing in the United States, go to http://www.fda.gov/cdrh/databases.html and select the Pre-market Notification (510ks) data-base or Pre-Market Approval database.