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Neil Pein, chief executive of BNP Paribas Leasing Solutions, says that Europe’s hospitals face a growing dilemma: invest now in technology and risk obsolescence, or delay and miss out on productivity gains.
The European Commission recently released its 2026 European Semester Spring Package, issuing health-related recommendations to 16 member states. The package highlights some persistent challenges in European healthcare, particularly around access, affordability, workforce shortages, and digital health readiness.
It also reinforced why investment in healthcare should be seen as an investment in Europe’s productivity. A healthy population works, innovates, and contributes, while a stretched health system contributes to the opposite by adding to labour shortages and putting strain on the public purse. Every delayed diagnosis and long wait for treatment has an economic consequence, as well as a human one.
But while the case for healthcare investment is clear, the sector is confronting a difficult paradox. Healthcare providers know they must modernise to cut waiting times, reduce time spent on admin, diagnose earlier, and improve patient outcomes. They also know that technology is moving so quickly, meaning technology decisions are becoming more difficult to make.
What happens when technology becomes obsolete before ROI?
Hospitals and healthcare organisations are under pressure to adopt tools like AI-enabled diagnostics and digital patient management systems, which promise to improve patient outcomes and help clinicians work more effectively. But the practical question that emerges from this is ‘what happens if the technology we buy today is outdated before it delivers a return’?
For instance, a dental practice may need specialist imaging equipment to improve patient throughput and experience, but might hesitate if the next generation of this technology is already on the horizon.
Investing too late could mean providers miss the productivity gains they urgently need. Investing too early, on the other hand, risks locking capital into equipment that may become obsolete before it has paid for itself. Illustrating these concerns, our recent research among senior leaders in European healthcare organisations found that 95% say that equipment becomes obsolete faster than five years ago. What’s more, 65% are delaying investment decisions due to rapid advances in technology.
This is leading to something of a stalemate for Europe’s productivity agenda. If hospitals and healthcare providers delay technology adoption due to fear of obsolescence, the productivity benefits of innovation remain out of reach. However, if they invest without a plan for upgrades, replacement, and lifecycle management, they risk increasing financial pressure on systems that are already stretched.
Supporting productivity without unnecessary exposure to technology risk
One way to reduce risk is to rethink the approach to investment. Traditional ownership models still have an important role to play, especially when equipment has a long and predictable lifecycle. But ownership can be a double-edged sword, tying up capital, making upgrades harder to justify, and leaving organisations carrying more of the obsolescence risk themselves.
It’s all the more important today as budgets are tight; Europe’s population is ageing; health systems are still dealing with post-pandemic strain; and workforce shortages remain an ongoing challenge. Reflecting these issues, data from Eurostat finds that overall healthcare expenditure across the European Union has risen to the equivalent of 10.0% of GDP. In this context, inflexible financing models can slow the investment that productivity depends on. Providers may know they need to modernise, but hesitate due to financial and technological risks that feel too difficult to absorb.
More flexible financing and leasing models can offer an alternative route, enabling healthcare organisations to access the technology they need, all while preserving capital and building in clearer upgrade pathways. Access-based approaches, where return conditions are defined contractually from the outset, may help organisations adapt more easily to technological change and shifting market conditions. Rather than treating equipment as a one-off purchase, healthcare providers can think more strategically about how assets like dentist chairs, MRI scanners, and state-of-the-art X-ray machines are used, upgraded, replaced, and managed across their lifecycle.
While the financial solution is important, it is just part of the equation. For usage models to truly develop and mature in healthcare, the wider ecosystem needs to come together, looping OEMs with distributors, maintenance, service, return, and refurbishment providers. Each has a role to play in not only supplying essential healthcare equipment, but also in making it possible to maintain, return, refurbish, and redeploy those assets safely and responsibly. Healthcare investment is often still viewed in linear terms, when quick innovation cycles demand a more circular approach, which, in turn, supports continuity of care.
The debate is not a binary choice between ownership and usage – moreover, aligning equipment strategy with faster innovation cycles and constrained capital. To unlock productivity, healthcare providers need the confidence to modernise without being punished by obsolescence. After all, asset decisions should strengthen resilience rather than restrict it.
