that is already included in the cost of the medical equipment by the manufacturer’s warranty, for example. In the extended warranty presented to Dr. Buyer, some of the covered items were already covered in the manufacturer’s warranty. For example, a specific part was replaceable for the same period of time, regardless of whether replacement was needed due to a manufacturer defect, overuse or improper use. In negotiating terms with the seller of the warranty, you may be able to carve out certain coverage that is duplicated in the manufacturer’s warranty, effectively reducing the purchase price of the extended warranty.
Explore This IssueSeptember 2012
You should also be aware of all conditions, limitations and exclusions that could void your coverage altogether. You would not want the equipment to be left unprotected by the warranty because of an avoidable act or omission to act. A physician client of mine successfully repaired a sticking key on the keyboard attached to a piece of equipment in his office. When the machine had an unrelated problem that would otherwise have been covered by the extended warranty, the coverage was denied because the machine had previously been repaired by an unauthorized party. I have reviewed and negotiated numerous medical equipment warranties in which coverage is voided in the event the equipment is not maintained or used as explicitly directed in the equipment’s manual.
The benefits and protections you receive under an extended warranty depend entirely on the language in the document. If provisions of the warranty do not meet your needs and the needs of your practice, then those terms should be revised and negotiated. While it is important to read, examine and understand all terms of an extended warranty yourself, I do not recommend purchasing an extended warranty without having an attorney review the warranty, negotiate if needed and explain any terms that are not fully understood. In order for an extended warranty to work to your best advantage, it is important to incorporate legal advice into the mélange of expertise necessary to decide whether to purchase the warranty or not.
Steven M. Harris, Esq., is a health care attorney and a member of the law firm McDonald Hopkins, LLC. Reach him at email@example.com.