523 / 2024-04-25 19:22:19

Impact of Medical Right to Repair, from the Perspective of Patients, Hospital and Environmental Dimension

After-sales service operations,system failure,durability,environmental impact,social optimization

The information hiding behaviour has led to the original medical equipment manufacturer's (OEM) monopoly on the repair market. The lack of detailed equipment information makes a third-party manufacturer (TPM) repair less reliable, making the local TPM service less beneficial for the hospital even if it can effectively reduce the equipment downtime and ensure higher system availability. As a result, frequent OEM repairs increase the operation cost and incur negative environmental impact, and it seems unlikely to have the repair decision benefit hospital and environment at the same time. Our research presents that the prevailing medical right to repair (RTR) movement that forces OEM to disclose equipment information is able to change this. In this study, a specific queuing model is developed to characterize the multi-period life cycle of the equipment that provides medical service for patients. Effects of the RTR on reducing the environmental impacts are studied based on a multi-stage game model. We find that 1) patients can adopt a defensive joining strategy, thus to keep a non-negative self utility regardless of the decreasing equipment performance due to TPM repairs, meaning than they may be indifferent to the RTR; 2) with support of the RTR legislation, hospital conditionally obtains higher revenue compared with when OEM monopolizes the market and meanwhile operates a higher durability decision; 3) the ‘‘win-win-win" outcome among the patients, hospital and environment can be achieved if the RTR execution leads to a highly transparent information level that can largely preserve the equipment performance from the TPM service; 4) the OEM can protect his monopoly position in the repair market by charging an expensive authorization fee from providing the transparent equipment information. Further government intervention policy or a subsidy scheme targeted at the authorization fee should be considered to avoid negative effects of the unfair pricing strategy.