Net present value and its use in performance appraisal for large medical equipments / 中华医院管理杂志

ABSTRACT

Net present value (NPV) is explained as followsIf the difference between the net cash inflow of the years within the lifespan of an investment project and the initial investment amount is greater than zero after being converted to present value,it proves the project as financially feasible.With a computerized laminagram camera of the radiology department of a hospital as example,the paper described the use of NPV in performance appraisal of large medical equipments.NVP can scientifically evaluate investment performance of the equipment,and remedy weakness of the recovery period method,making it highly practical.Better hospital information system serves as the cornerstone for more accurate net present value indicators.Reinforced management for equipment controllable costs and cutback of cash outflow are effective means to upgrade equipment performance.