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The decision-making process and the corresponding actions following a medical facility fire loss must be carefully considered. As with many commercial losses in this technology-driven age, these losses can contain significant amounts of equipment.
However, it is important to understand the unique attributes of medical equipment losses. For example, there can be significant business interruption costs associated with hospital losses. It is not uncommon for business interruption costs to exceed $100,000 per surgery in a single surgical suite. Further, medical equipment in a hospital is typically under some type of warranty or maintenance contract. As a result, nearly every manufacturer associated with the hospital may attempt to sell new equipment, citing that the warranties or maintenance contracts are now null and void. Add in the amount of highly sophisticated equipment that is located in hospitals, and property damage costs can escalate quickly if replacement equipment is required.
According to the U.S. Fire Administration, approximately 2,500 fires occur each year in medical facilities, with an overwhelming majority of those occurring in hospitals. However, it is understood that many medical facility fires tend to be small in nature. In fact, medical facility fires are typically so small that the sprinkler systems activate in only six percent of cases. Based on this information, it can be assumed that much of the equipment located in a medical facility would not be heavily damaged and would thus not require replacement following most fire losses.
Establishing a Checklist
Given the above issues, one can see the importance of moving quickly when dealing with medical equipment losses. As such, one of the first steps when handling these situations is to solicit the opinions of the individuals who know the equipment better than anyone: the maintenance staff and on-site biomedical engineers. It is also important to facilitate an experienced outside equipment loss consultant knowledgeable of the nuances associated with medical equipment claims. Someone familiar with the Joint Commission (formerly JCAHO) standards and the Food and Drug Administration standards is preferable. Joint inspections help build consensus on the appropriate action to be taken for the equipment, which can greatly reduce uncertainty or disagreements.
Once the facility has been environmentally stabilized through dehumidification, air conditioning, and the erection of appropriate containment, a room-by-room inspection of affected areas should be completed jointly by the staff engineers and the outside loss consultant. Through this inspection, initial recommendations can be provided for the business-critical equipment affected by the loss event, whereby equipment can be segregated into three categories: those that definitely require replacement; those that may require decontamination, repair, and testing; and those that can be used immediately. If possible, move usable equipment to an alternate, temporary location within the facility to limit the business-interruption and extra-expense costs. Additionally, it is imperative that the facility and equipment receive equal priority in assessment, remediation, and triage. Without equipment, the surgical suites are useless, and vice versa. Therefore, coordination between the facility restoration contractors, staff biomedical engineers, maintenance staff, manufacturers, equipment loss consultants, and equipment restoration specialists is vital.
As previously mentioned, based on the information received by the U.S. Fire Administration, many medical facility fires are relatively small in nature. This suggests that the equipment does not typically require replacement if it has only been affected by smoke and soot and, in these cases, equipment restoration and decontamination is certainly an option. In many instances, equipment restoration is cost-effective, extremely reliable, and can save valuable time in returning the equipment to operation, especially when considering the extended lead times of obtaining replacement pieces with such specialized equipment.
While it is true that the chemicals deposited on equipment can adversely affect it, the effects of this contamination can vary widely based on several factors, including the composition and type of contaminants present, the amount or concentration of each respective contaminant, the environmental conditions present at the loss location, and the equipment type and the materials used in the construction of the equipment. In addition, the type of contamination deposited on the equipment is dependent upon the combusted materials. According to the U.S. Fire Administration study, plastic is the most common combustible in medical facility fires.
The byproduct of burning plastic is typically chloride ions. When the chloride ions interact with moisture in the air, hydrochloric acid can form on the equipment and cause corrosion on metal surfaces and electronic areas. Within electronics, this change in chemical properties also results in a change in the conductivity of the metal. These conductivity changes can result in spurious operation of the equipment, as the corroded devices may not pass electrical and data impulses properly.
Setting the Standard
However, if action is taken quickly to remove the contamination, the medical equipment can be returned to pre-loss condition using scientifically proven decontamination and restoration techniques. In an effort to understand not only the effects of combustion byproducts on electrical and electronic equipment, but also the likelihood of failure from this contamination, the U.S. Department of Energy undertook a study that, in part, determined the probability of failure of equipment at various contamination levels. The results of their study, published in the DOE Fire Protection Handbook Volume II, "Fire Effects on Electrical and Electronic Equipment," showed that the probability of failure of equipment increases exponentially with increasing contamination levels. The study provided scientific data regarding the contamination level below which the probability of failure is zero and also levels above which restoration is typically not cost effective.
The DOE study provides some useful information in relation to equipment restoration. First, equipment restoration is typically not cost effective above 500 micrograms per square inch of chloride equivalent contamination. Factors affecting whether the equipment can be restored if contaminants are above this level include the type of equipment and the cost and availability of replacements. Another important result of the study is that the probability of failure is zero at contamination levels of 20 micrograms per square inch or less. As such, in order for restoration to be reliable, the contamination level must be reduced to 20 micrograms per square inch or less chloride equivalent.
Other standards also can be implemented, including the IPC Standards. The IPC is an association of companies affiliated with the manufacturing of printed circuit boards and electronic assemblies, including those installed in medical equipment. They set standards that include the electrical clearances and cleanliness of electronic assemblies. The cleanliness standard for newly manufactured boards is set at 10.06 micrograms per square inch chloride equivalent. Please note that chemical wipe samples can be analyzed by independent laboratories to provide accurate chloride equivalent contamination results.
Even with above references providing a scientific basis for decontamination, it is common for health-care organizations, risk managers, maintenance staff, and manufacturers to object to equipment decontamination, mainly because there is the public perception and opinion that the equipment will never be reliable. Through the educational process and scientific studies, it is reasonable to assume that the insured health-care organization will understand the issues and work with an insurance company to handle the warranty situation equitably and sensibly. Further, with the insured's cooperation, there are steps that can be taken to ease every party's concerns, including the manufacturer and service provider.
For example, a common objection is that the manufacturer is voiding all warranties or the maintenance vendor is canceling all maintenance contracts with respect to the equipment. The first step is to discuss the science behind the recommendations with the manufacturer or service vendor. What studies have been completed that show reliability issues with fire-contaminated equipment other than the Department of Energy's study? If they do not have any additional studies (which is likely), then request their cleanliness standards for newly manufactured pieces of equipment. Someone on their technical staff should have this information. An IPC-certified equipment restoration company or other reputable contractor will likely be able to meet those standards.
If the scientific studies have still failed to sway the skeptical manufacturers and service providers, it is recommended that the service provider or manufacturer be included in any clearance testing or burn-in testing. In this situation, the vendors are able to conduct their full testing, receive compensation for their testing and repairs, while still having the ability to retain their customers. In the current market, very few vendors are willing to lose a customer over a potential warranty issue.
However, if there are still objections, there are highly reputable third-party warranty and maintenance contract providers in the market that will be able to match the language of the maintenance contracts for a fee. While this is not always the most cost-effective option, it is one that removes the argument of lack of service on equipment.
When dealing with fire losses in medical facilities, the above actions may assist in coming to a quick, equitable, and satisfactory settlement for all involved. Using education, science, and experience can reduce the effects of such a loss and smooth the road to recovery.
Mark Ewing is the director of complex loss operations at LWG Consulting. He has assisted claim professionals, as well as risk and disaster recovery managers, in matters arising from damage to high-technology equipment.
Andrew Spetter is the director of equipment restoration at LWG Consulting. He is a Certified IPC Trainer with knowledge of cleanliness standards for newly manufactured printed circuit boards.
