Which is better: buying or leasing medical equipment?
If you’re thinking about buying an X-ray machine, the best answer for you will depend on your medical practice’s or facility’s unique needs.
When attempting to decide which way to go, there are two deeper questions you’ll need to consider:
- How much money am I willing to invest up front?
- How frequently am I going to need to upgrade my equipment to newer technology?
There are advantages and disadvantages to both buying and leasing your medical equipment, depending heavily on the answers to these qualifying questions.
Disadvantages of Leasing Medical Equipment
When leasing equipment, you never really own that expensive X-ray machine.
The major downside to leasing medical equipment is that you never build financial equity.
A second downside is that you are required to make payments for the entire lease period. If circumstances change and you no longer have a use for the equipment, you will usually be required to pay a penalty to cancel the lease agreement.
Advantages to Leasing Your Medical Equipment
When leasing medical equipment, acquiring your needed X-ray machine can be less expensive in the short run.
There is usually no down payment required, and most banks offer flexible financing terms. These advantages can work in your favor if you have damaged credit or if you need a longer payment plan.
If you’re anticipating the need to update your equipment frequently, you can put together a lease agreement in cooperation with your lender that makes this requirement easier to fulfill.
Disadvantages of Buying Your Medical Equipment
When buying equipment, the upfront cost is going to be considerably higher.
Most banks will require a down payment in order to finance your purchase.
Another disadvantage is that, by the time your equipment is paid off, it will more likely have fallen behind newer technologies. In some cases, it will become obsolete before or just after your loan has been paid off.
Advantages of Buying Your X-ray Equipment
First, when buying instead of leasing expensive medical equipment, you will be eligible to receive tax savings through depreciation deductions. This can save you money annually.
The second advantage is, when the equipment has been paid off, you’ll then have full ownership. This situation will be financially beneficial if you plan on keeping the equipment for a longer period of time.
It’s also important to remember that Section 179 allows eligible businesses to deduct the entire cost of their purchase from their 2018 income, even if the equipment is financed and an initial payment isn’t required until 2019.
Buying or Leasing Your Medical Equipment: We’ve Got the Right Solution for Your Facility
We’ve spent decades helping large hospitals, small practices, and everyone in between find the right imaging equipment at the right price.
We understand that financial circumstances differ from situation to situation and that not everyone needs the most robust piece of equipment on the market.
Let us put our experience to work for you.
Whether you’re planning on leasing or buying your medical equipment, we’re here to help you find the perfect solution for your practice’s or facility’s radiology needs.