Service contract protections
All service contracts should have an out clause. There are two types of cancellation clauses--with cause and without cause. Negotiate both of these clauses into every service contract you enter into. It is absolutely necessary to include clear cancellation terms in the signed contract--don't rely on your standard purchase agreement language to do this.
If you cancel with cause because of a deficiency (for example, if the quality of service is not acceptable), there should be no penalty to cancel. Typically, there is a reasonable time period for the company to correct the deficiency. In most contracts it's 30 days. If you decide to cancel without cause (for example, if you decide to use a different management program, or expand in house service), your healthcare organization will most likely pay a penalty for canceling mid-term, but this penalty should be a reasonable charge. Some service contracts have penalties as high as 25 percent of the unused contract. Unless negotiated upfront, service providers will not refund or cancel a service contract if a healthcare organization wants to expand their in-house maintenance department.
OEMs try to tie three other important management issues into the service contract rather than the purchase of the equipment. Take steps to negotiate them at the time of purchase. First, ensure that OEM diagnostic software installed in your equipment continues to be at the highest-level revision. Second, make sure all software upgrades and field modifications will be provided for the realistic life of the equipment at no additional cost to you. Finally, require the OEM vendor to make its remote diagnostic software service feature available to you for the life of the equipment, regardless of how you pay for the post-warranty services.
Service contract negotiations
Beware of extended warranties at the time of purchase. These are simply standard warranties combined with a multiyear service con tract. Standard warranties should last one year for the majority of high-end, clinical equipment. For equipment with no mechanical or electromechanical parts, a shorter period may be acceptable. Make sure the warranty begins after installation is complete, and the equipment is working reliably before you sign any service contract.
SOURCE:http://findarticles.com/p/articles/mi_m0BPC/is_10_29/ai_n15685943/
All service contracts should have an out clause. There are two types of cancellation clauses--with cause and without cause. Negotiate both of these clauses into every service contract you enter into. It is absolutely necessary to include clear cancellation terms in the signed contract--don't rely on your standard purchase agreement language to do this.
If you cancel with cause because of a deficiency (for example, if the quality of service is not acceptable), there should be no penalty to cancel. Typically, there is a reasonable time period for the company to correct the deficiency. In most contracts it's 30 days. If you decide to cancel without cause (for example, if you decide to use a different management program, or expand in house service), your healthcare organization will most likely pay a penalty for canceling mid-term, but this penalty should be a reasonable charge. Some service contracts have penalties as high as 25 percent of the unused contract. Unless negotiated upfront, service providers will not refund or cancel a service contract if a healthcare organization wants to expand their in-house maintenance department.
OEMs try to tie three other important management issues into the service contract rather than the purchase of the equipment. Take steps to negotiate them at the time of purchase. First, ensure that OEM diagnostic software installed in your equipment continues to be at the highest-level revision. Second, make sure all software upgrades and field modifications will be provided for the realistic life of the equipment at no additional cost to you. Finally, require the OEM vendor to make its remote diagnostic software service feature available to you for the life of the equipment, regardless of how you pay for the post-warranty services.
Service contract negotiations
Beware of extended warranties at the time of purchase. These are simply standard warranties combined with a multiyear service con tract. Standard warranties should last one year for the majority of high-end, clinical equipment. For equipment with no mechanical or electromechanical parts, a shorter period may be acceptable. Make sure the warranty begins after installation is complete, and the equipment is working reliably before you sign any service contract.
SOURCE:http://findarticles.com/p/articles/mi_m0BPC/is_10_29/ai_n15685943/
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