When Dr. Satish Chandra of Madison Radiology, opened his fifth full-service imaging center in upper Manhattan and the South Bronx, he chose Hitachi Medical Systems and Key Equipment Finance as his partners. Dr. Chandra and his team at Madison Radiology are continuing to provide comfortable, state-of-the-art, outpatient imaging services in the midst of one of the most underserved areas in the U.S.
Today’s imaging equipment is more sophisticated than ever, but with a potential cash outlay of millions of dollars, most radiologists find themselves shopping simultaneously for both equipment and a way to finance it. The goal of Dr. Chandra and Tej Shah, CFO of Madison Radiology, was to equip their new clinic with the latest technology by working with an equipment manufacturer who could also provide flexible financing alternatives that would help meet the cash-flow needs of his new clinic.
Shah explored various equipment and financing options, but the joint proposal from Hitachi Medical Systems and Key Equipment Finance provided a solution that enabled him to obtain state-of-the-art equipment with a low monthly payment, including covering a portion of the construction to the building.
“When we sat down across the table we had the equipment experts from Hitachi and the finance experts from Key Equipment Finance working as one team to help us find the right solution,” said Shah. “Both companies have a deep understanding of the radiology business and were extremely intuitive to our needs.”
Those needs included a new MRI system, CT scanner and mammography machine with no cash up front and low monthly payments. The healthcare experts at Key Equipment Finance provided the team at Madison Radiology with a financing package that included:
By financing the total cost of the equipment, Shah was able to obtain the equipment they needed while conserving cash, allowing the clinic to pay for the equipment as it began to generate revenue.
The Fair Market Value (FMV) lease provides lower monthly payments during the normal financing term to help reduce the financial burden on a new business.
Financing the deal was both critical and prudent for the two parties; it allowed the hospital to preserve cash for other expenses or investments, and Madison Radiology would not have been able to move ahead with the project without third-party funding.
In addition to covering the cost of equipment, the financing package also covered the cost of the site preparation work necessary before the new clinic could open. This helped Madison Radiology conserve cash while covering the cost of these improvements.
The financing arrangement proved to be a win-win-win situation according to Shah, Hitachi Medical Systems and Key Equipment Finance. “We have worked together to finance equipment at some of our other clinics and we consider our contacts at both Hitachi Medical Systems and Key Equipment Finance to be true partners in every sense of the word,” said Shah. “The new equipment will enable us to provide better service to more patients, so we can continue to serve New Yorkers and expand our businesses without being burdened by cash flow concerns.”
“When it comes to selling state-of-the-art capital equipment like MRI and CT systems, coming to a meeting with a finance partner is just table stakes,” said Miller. “Our partner also has to be exceptionally well versed in healthcare, and they have to work with us to provide a seamless experience for our physician clients. That’s the kind of partner we have in Key Equipment Finance, and at the end of the day it makes us more competitive.”
Madison Radiology plans to open a sixth outpatient imaging center in the near future, and Rich Miller, vice president of sales at Hitachi, anticipates the relationship between Hitachi Medical Systems and Key Equipment Finance will help both companies secure a chance to work with Dr. Chandra and Shah again.
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