DOT 4L Authorized Repairs?

“There is no fact which I fear or do not care to know”
- Thomas Jefferson

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If asked, “Is your service company authorized by the DOT to repair 4L cryogenic liquid cylinders?” would you say-

a) “Well of course they are. They wouldn’t be working on them if they weren’t.”
or
b) “We, at XYOGZ Welding Supply, personally verified them for high pressure cylinder repair so they are OK’d for DOT 4L vessel repairs, too.”
or
c) “Yes. They are and we know because they install their date stamped DOT ‘K’ tag on every vessel they service in accordance with the guidelines outlined in 49CFR. By the way, their ‘K’ number is ______.”

Anyone answering “C” has a commendable understanding of at least some of the requirements for compliance with 49CFR guidelines for 4L liquid cylinder repairs.

A beautiful thing about the internet is how easy it makes it to search and find information. Those with “A” or “B” answers might just want to dig a little deeper into the subject before........

Lifting Cryogenic Liquid Cylinders?

Try getting a consensus on issues related to lifting liquid cylinders up into overhead work areas. Good luck. As few manufacturers of cryogenic liquid cylinders as there are, the only consistent answer I could get is “Do Not Lift by the Handling Ring.” And- this is extremely important. There are many cases where lifting devices were attached to handling rings and the cylinders lifted up with bad consequences. Clearly, everyone I talked with agreed that handling rings are not a lifting point.

Beyond that, I was curious on the various manufacturers’ position related to using the eyes in the handling ring support posts for lifting filled vessels and made calls to all. Responses varied and the reasons became obvious pretty quickly. Some of the original manufacturers either no longer exist at all or have been acquired by others. This is important as there are still liquid cylinders that are in use since the 1970s and the differences is designs for liquid oxygen, nitrogen, argon and carbon dioxide cylinders are subtle, but meaningful. Almost all include holes in the handling ring support eyes that are used as catch points for cylinder handling carts. These carts have a hook which slips into the hole and grabs it so the liquid cylinder can be tilted back in the cart and rolled. This is a widely agreed method for moving liquid cylinders as long at the user has a cart designed for the purpose and is using it in the proper method.

The real question comes up when it is necessary to get a liquid cylinder up to a 5th floor work area at a site under construction or demolition. Without going into the variety of responses related to engineering of supports for lifting and potentially proper devices I’ll take a different tack.

- Do you know where that liquid cylinder was last month, last year, last decade?
- Do you have a document in front of you clearly stating that the lifting support stanchion holes for the exact model of vessel you have are intended for lifting full liquid cylinders overhead including instructions on the proper method and device?
- Do you have an inspection report certifying the current condition of the welds and metal?
- If not- Why risk it?

The picture attached shows a common condition of cryogenic liquid cylinders received by West Cryogenics for repair. Note the bent supports and associated stress to the head. Corrosion of outer vessels is also frequent. All of these change the game from original design and might not ever be discernable after a good rehab job. The safer approach for lifting would be to use an approved lifting cradle, freight elevator or other device rather than a direct connection to the vessel. Personally, I’d rather have the excitement of seeing my wife and kids and watching “House” or “Top Chef” than dealing with the aftermath of a liquid cylinder that tore loose from its lifting hook 40 or 50 feet in the air.

Taking Inspiration Where You Find It

It’s oft been said that one of the problems of operating in a senior position is the greatly reduced volume of useable feedback you get. Too many people try to be nice or are simply pulled in so many different directions that they can’t really take the time to care too much. So, if you really want to continue improving, you start looking for input and feedback through a broadened contact base and you might even have to resort to reading some.

One of the best articles I’ve read recently was a discussion with Jim Collins (“Built to Last” author) in the February 24, 2009 issue of Fortune magazine. It is good enough that I strongly recommend you read the whole thing. Here’s a link http://money.cnn.com/magazines/fortune/fortune_archive/2009/02/02/toc.html.

The main points that I got out of this is how important it is to, as Vince Lombardi says “Do the right things all the time.” Collins notes some pretty important points that are particularly consistent with the way of life at West Cryogenics. Here are some:

- Speaking of P&G- “….. they said a customer will always be able to depend on the fact that a product is what we say it is- we will always build our reputation on quality. When they were under pressure to start cutting corners or use cheaper ingredients, they just didn’t do that. What we have found is that what really matters is that you actually have core values- not what they are. The more challenged you are, the more you have to have your values.”

- And- “One of the big lessons we’ve learned is that turbulence is your friend. If you were disciplined and prepared when the storm came, then you should be thankful for the times. Take Southwest Airlines…… Southwest was once a startup company with a cash-flow problem. Their famous 20-minute turnaround time came about because of cash constraints. They had fewer planes, but they could get them back in the air quicker. They used adversity to invent a discipline that they never lost.”

It is likely that West Cryogenics would never have successfully begun manufacturing were it not for the time and resources that suddenly became available during the post-9/11 downturn. For those of us raised on the likes of Vince Lombardi, John Wooden, Winston Churchill, and Galileo there is an appearance of passion for adversity that has almost the air of masochism. Maybe the sleep we achieve so easily at night is best captured by Lombardi:

"I've never known a man worth his salt who in the long run, deep down in his heart, didn't appreciate the grind, the discipline. There is something good in men that really yearns for discipline."

"Once a man has made a commitment to a way of life, he puts the greatest strength in the world behind him. It's something we call heart power. Once a man has made this commitment, nothing will stop him short of success."

"I firmly believe that any man's finest hour, the greatest fulfillment of all that he holds dear, is the moment when he has worked his heart out in a good cause and lies exhausted on the field of battle-victorious."

A Case for Capital Equipment Investment

Is there a rationale for investing in cryogenic tanks or other capital equipment when funds for wages are tight? Yes, absolutely. The key word in here is “investing” which, in a classical sense, means to put money into something expecting at some point to extract more out than went in. There is also investment leverage where the money put into one thing reaps added savings for another.

As for direct investment- one of the most common in cryogenics is the purchase of tanks which are rented to end users or distributors for storing liquid oxygen, nitrogen or argon molecules. Ideally, the rent is calculated at a rate that produces income above the cost of money for the acquisition. At some point, rental income pays for the cryogenic tank while rental fees continue. A most interesting aspect of cryogenic tanks is that they usually enjoy a long service life with minimal upkeep. And, there has been the potential for a 20 year old vessel to sell for more than its original purchase price due to increases in raw material and labor.

Leveraging provides the icing on the cake for investors. In many cases, the availability of vessels for rent has been the difference in getting or losing business. Often, the cryogenic tank, liquid cylinder, vaporizer or other equipment is just the tip of the iceberg where the most significant returns are tied to sales of gases and supplies.

The distributor, dealer or contractor who shows up with equipment ideally suited to an application often has an advantage equal to having a gun at a knife fight. The “right” equipment can make all the difference in the profitability of a project by greatly reducing direct labor, cycle times and other wastes. Examples range from faster cutting results achieved with enhanced vaporization to reducing set up and reconnect times by equipping welders or cutters with liquid sources that will see them through a full day of work. And, for contractors, the ability to get in and get the job done expeditiously means both the opportunity to jump onto another job more quickly and greater favor with a now happy client. It can also mean completion of a project with 12 people where 15 were projected.

Why is CO2 Service a One-Way Trip?

Liquid Nitrogen, Oxygen and Argon are typically produced by cooling atmosphere in air separation units to levels below their boiling points. In a form of reverse distillation, the gases liquefy and are collected as relatively pure products. Due to their purity and absence of residual contamination it is common for liquid cylinders or bulk tanks to be used for one product and switched to another following purging and testing.

Liquid carbon dioxide (CO2), on the other hand, is usually collected as a byproduct of manufacturing other products. Depending on the specific grade of CO2, trace levels of non-volatile organic residue (oil and grease) and total volatile hydrocarbons are common and tend to linger after the CO2 product is vaporized and used.

Conscientious gas producers, distributors and service companies go to great pains to avoid the potential for mixing oils, grease and hydrocarbons with pure oxygen. In turn, it is generally deemed unacceptable to convert a liquid CO2 vessel to any other service. It is just not possible to verify complete cleanliness of a vessel after it has been in CO2 service and there is not an acceptable level of risk above zero when it comes to oxygen possibly coming in contact with flammable and/or explosive residue.

Faster Liquid Nitrogen Flow

A university lab called today with a very similar question to one received earlier in the week. Again, they have a cryogenic liquid nitrogen cylinder that is set up for liquid only. This means that the only valve connections are “Liquid” and “Vent.” As was the case with a previous caller, they needed more pressure to push liquid out faster. Their proposed solution was to feed high pressure gas into the vent side forcing a high liquid discharge flow.

Did I have a problem with this? Yes.

And what was the problem? The problem is the fact that the high pressure gas cylinder was starting out with 1000psi or so of pressure and they were going to depend on manual control of a valve to regulate how much pressure they were putting into a DOT 4L-100 liquid cylinder fitted with a 150-175 psi burst disk and 22 psi relief. Granted, the relief should open if pressure gets too high and if the flow is not high enough from the relief then the burst disk would blow. The problem is that the combined outlet flow from both could possibly be too low to fully relieve the pressure coming in from the gas cylinder. This could ultimately result in the vessel exploding.

It was strongly suggested that they avoid this non-standard operation and instead secure a VGL with a pressure building circuit so that the vessel could be operated as designed. There is just no justification for generating a risk and possibly hurting someone by jury-rigging a container.

Is Microbulk Cultural?

Seven or eight years ago U.S. Manufacturers were told that there would be no real reason for them to do much in the way of 250-500 gallon vertical bulk tank production. Reasons given included plentiful stocks of used equipment and the inability of suppliers to economically justify small volume cryogenic liquid deliveries. Yet, During the past few years, sales of microbulk vessels in the 1000 to 2000 liter range have been strong. These are the same sized vessels just packaged differently.

This might be ironic except for the fact that “Nature abhors a vacuum.” And- just because a major producer of liquid oxygen, nitrogen and argon has a business model that focuses their efforts on deliveries of 1500 gallons or more does not preclude the need of users. Posed with the question of how to fill the gap from liquid cylinders to 1500 gallon bulk tanks one producer eloquently responded “That’s what distributors are for.” And in the U.S. this has proven largely true.

Interestingly enough, though, I was informed that some of the same companies who have 1500+ models in the U.S. are actively involved in establishing a microbulk presence in Europe and Asia. Part of the answer given for this is a cultural aversion in other countries to soliciting a competitor’s clients for nearly identical services. For example- If Manufacturer X is buying 20-30 liquid nitrogen cylinder exchanges per month then it might be considered unseemly for a competitive supplier to come in and offer to provide the same service at a lower rate. But- A competitive supplier who offers the same liquid in a different package is offering an alternative that changes the rules of the game.

I’m told it would still be “unseemly” to go out directly soliciting microbulk business as an alternative, but there are means of finessing the approach so that the client calls the supplier to initiate discussion. Economic presentations at trade shows, article publication, web posting and general advertisement all become fair game along with referrals from other happy clients. Overall, this is sort of a retail walk-in approach to engaging clients vs. a more active direct approach in the U.S.

Good Fun and Good Ice Cream at Sub Zero

Our high school invites the parents of graduating seniors to attend the homeroom class Valentine’s Day Party and “do whatever you’d do when you were eight.” I come with my little bag of Valentines (“one for everyone regardless…..”) and a bag of candy to find a bunch of 17 and 18 year olds absolutely tickled to be exchanging sweets and treats. Of course, there are also the wistful thoughts wondering what it would be like if every day was a little party.

My next thoughts are of Jerry Hancock and Sub Zero Ice Cream where every day is a cryogenic ice cream party. Fortunately, Jerry is enjoying real success with his novel stores where you get to mix your own concoctions and then turn them to milk shakes, soft or hard ice cream right before your eyes. The difference in what you get is determined by how long you feed liquid nitrogen into your mix. A lot of the enjoyment comes from the fun mixed in with the magic of quick freeze and delightful presentations. Also- according to Jerry: “The faster you freeze the ice cream, the creamier it is, because ice crystals don’t have a chance to form.”

Starting from stereotypical humble beginnings Sub Zero is now taking their cryogenic ice cream into the potentially hot franchise market and has done some great web site upgrades in preparation. If you can’t get to one of his locations in Utah and enjoy the fun in person you can always visit the site at www.subzeroicecream.com. And, who knows- if Jerry’s plans for going mobile work out you might even find him at your next Valentines party. If you do, please say hi for me.

4L-DOT and Liquid Nitrogen

Easily the most commonly asked questions about 4L-DOT class cryogenic liquid cylinders relate to pressure ratings. This can be a bit confusing since the data plate itself does not tell you directly what pressure relief should be installed on the liquid cylinder.

Yesterday's question came from a client who asked about an application where their client is using low pressure (4L-100) liquid nitrogen vessels with 22psi reliefs. 4L-100 are low pressure cryogenic liquid cylinders and are typically for liquid-only applications. “Liquid only” vessels are built with no pressure builder or pressure builder circuit. The absence of pressure building and gas use coils help the vessels hold product longer (all other things equal) than VGLs since they have less heat sinks.

The question was- “Can a pressure builder be added to a Liquid Only 4L-100?” It seems the end user has a need to build a few pounds of pressure behind the liquid to push it out continuously. While technically possible to make some type of PB loop on a vessel designed for liquid nitrogen only this would be a non-spec modification and would never really work right. The more effective solution to meet this need is to use a VGL which already has a PB loop and fit it with a 22psi pressure relief. The PB loop would then only be cracked open for a brief moment and closed as needed. Otherwise the PB will cause the unit to build pressure above 22psi continuously and vent until empty.

Vacuum Rupture Disk D- CSI Outer Leak

Another client met me at the door saying, “Your timing is perfect. Come back to the plant and see what you can tell us about this freshly rehabbed vessel that we are having some trouble filling.” The problem was apparent from about ten feet away. We walked on up to the vessel and found a neat hole (about welding wire diameter) that went through the plastic rupture disk cover, the “Do Not Remove” warning and apparently through the rupture disk. The plastic cover and label were removed to reveal the expected “sucked in” rupture disk. This was obvious tampering and one of the few times I’ve seen it done through the rupture disk cover.

Vacuum rupture disks plastic covers are put on cryogenic liquid cylinders both to prevent tampering and to protect the very thin disk material from welding and cutting sparks and corrosion. A supplier who is able to consistently assure that all liquids go out with rupture disk covers in place is both protecting their assets and providing a ready visual indicator for drivers to help with spotting potential problems.

Many of the liquid oxygen, argon, and nitrogen bottles that come in with blown rupture disks are clearly tampered with. Spotting problems at the user site and documenting them helps with the possibility for recovering the cost of repairs for damages.

A lot of people believe that “if you take care of the nickels the dollars will follow.” Here is a case in point.

Blown Rupture Disk C- CSI Inner Leak

Delivery Company Y makes a delivery to my shop. Two weeks later I call them and say I just got to this box, it is damaged and I want to place a claim. Unable to stand the sound of their laughter I hang up. Much is the same when a gas supplier tries to call their client two weeks after picking up liquid cylinders to say that some of them are damaged and they are going to bill the customer. The difference is that the reaction from the client can be a little rougher than laughter.

Having alert drivers who pay attention to what they are loading at pickups, note damage found and get customer signatures is priceless. Take for instance a cryogenic liquid cylinder that has a bent handling ring, piping and a dent on the head. Looking a bit further the driver finds that the vacuum rupture disk is blown out. This is pretty simple. The liquid cylinder has been dropped and there is now an inner leak at the neck or some other point. The contents (oxygen, nitrogen, argon or CO2) has escaped into the annulus, built pressure and blown the rupture disk.

Now the cryogenic liquid distributor is confronted with either a costly repair $750 to $1000 or more or replacement of the liquid cylinder $2000 to $3000 or more. In the case of a larger “micro-bulk” vessel that is set down too hard and snapped a neck connection the replacement cost can be well over $10,000 to $20,000. And- it is really hard to tell if that happened at the customer’s site or the fill plant without documentation at pick up.

Note that all inner leaks are not the result of abuse. Some do occur due to manufacturing or design issues, but the chance of recovering or even sharing costs with users are greatly diminished without documentation…… and reasonably so.

Vacuum Rupture Disk- Blown B

A client called upset that they’d just received 20 liquid cylinders back from rehab and now had 18 in the yard “bad.” They wanted immediate attention and got it. Two things were obvious on arrival. The first was that there were no DOT-4L repair “K” tags on the vessels indicating right away that we’d never seen the vessels in question. Number two, and most upsetting to the client, was the very apparent indication that someone had intentionally punctured the rupture disk on 18 of the 20 liquid cylinders. This was obvious as the protective disk covers were missing and the disks were blown “in” instead of “out.”

The purpose of vacuum rupture disks for cryogenic tanks and liquid cylinders is to prevent rupturing of the outer vessel which has no pressure rating. Vacuum rupture disks are very thin, concave and surrounded by knife edges which are lined up just over the surface. A very low pressure build up in the annular space of an oxygen, nitrogen, argon or carbon dioxide cryogenic tank will cause the disk to protrude against the cutting edges and rupture allowing free flow of the gas to atmosphere. So- any CSI investigator who sees the disk blown out can readily tell that a vessel with a disk blown “out” probably has some type of inner leak.

A disk that is blown “in” indicates a leak occurred in the disk and the vacuum in the annulus sucked atmosphere from outside pulling the disk in. There are slip-on plastic protective covers installed over most disks to prevent damage that would cause a leak. Many manufacturers and service companies also install a warning between the cover and disk noting that removal or tampering will void any warranty of the vessel. This cover helps protect the disk from welding or cutting sparks and corrosion that could cause a vacuum space leak in the cryogenic tank.

When there is a good vacuum on a tank then rupturing the disk will cause a great whoosh of flow into the annulus. It is an all too common occurrence for vandals to remove the covers and puncture the disks. Whether their intent is malicious or just for entertainment the result is the same. The liquid cylinder now has no vacuum and will have to be sent in for a rather expensive repair.

Next, we’ll talk about responsibility and how cryogenic liquid suppliers can save hundreds of dollars by training their drivers to be alert to damage and consistent in documenting it on site.

Vacuum Rupture Disk- Blown A

Which cryogenic liquid cylinder in this photo still has a vacuum?

Actually, the only thing we can tell from this photo is that the bottom two do not have any vacuum since their vacuum rupture disks are both blown. The top liquid cylinder might or might not, but this can only be determined through testing.

Vacuum rupture disks are installed on cryogenic liquid cylinders and tanks to protect the outer vessel from rupturing. The inner vessel of a cryogenic tank or liquid cylinder is typically designed as a pressure vessel. Both resetting relief devices and one time rupture disks (head safeties) are usually installed to prevent the inner vessel from over-pressuring and exploding. The outer vessel is only a protective skin and carries no pressure rating. A leak from the inner vessel into the annulus causes pressure to build against the outer vessel. Vacuum rupture disks or vacuum lift plates are installed on outer vessels to allow them the vent almost immediately in the event pressure begins to form in the annulus.

The next things we’d like to know are what might be determined from “how” the disk blew and “who” might should bear the cost of repair.

Medical Oxygen Wakeup Costs Reduction D

Outsourcing provides many homecare companies the option to provide liquid oxygen where they otherwise would not be able to. For others already delivering liquid it can mean increased profits and the ability to focus energies on patient care and other parts of their business. Outsourcing is a big topic containing enough twists and turns that we’ll come back to it with more extensive discussion in later posts.

Some people wonder how a subcontracting company can provide liquid medical oxygen delivery at a rate low enough that they and the principle homecare provider can both make a profit. And this is a good question as there is no guarantee that every situation has a mutually beneficial solution. Also, even where there are standard conditions that would seem to be ideal there are other voiding conditions. This is particularly true in smaller or more remote areas where there is not an adequate concentration of users.

One place the outsourcing model works best is where the delivering company (outsource provider) can enjoy increased economies of scale by adding stops to daily routes. It is pretty easy to see that a lot more positive cash flow is generated from a route that does 16-20 stops in a day than a route doing 6-10 stops. Picking up subcontract deliveries can make a huge difference in profitability even if the incremental additional deliveries are provided at lower rates than others. This is much like the pizza delivery model where more actual profit might be made from the second pizza at $6 than was made off the first pizza at $12.

The point of all the ideas we have covered is that it is possible in many cases to increase positive cash flow generated by liquid medical oxygen delivery. And, the availability of liquid delivery can also generate other positive referrals and revenue streams for homecare providers that they would otherwise be missing.

Medical Oxygen Wakeup Costs Comments

A couple of really good comments came in today:

Medical Oxygen Wakeup Costs Reduction B You do not mention the fact that owning a bulk tank makes the homecare provider a "manufacturer" in the eyes of the FDA (compared with a "distributor") and opens them up to increased inspections by the FDA or the state board of pharmacy/dept of health.

Medical Oxygen Wakeup Costs The bulk supply company should work with their clients to stagger the refill time. They should also invest in a larger capacity fill hose to get these trucks "in and out" as the faster their customers trucks are on the road making deliveries, the less time their employees are having to spend filling these vans.

Medical Oxygen Wakeup Cost Reduction C

Several suppliers in the U.S. are now offering innovative remote filling services for truck mounted medical liquid oxygen delivery vessels. A few are actually meeting delivery trucks in the field and providing a sort of “in-flight refueling” service that allows homecare oxygen providers to extend their work day without a trip to their main bulk oxygen supplier for refilling. Other suppliers are going to their homecare liquid oxygen delivery client's sites and filling their trucks after hours so that drivers are able to go straight out on their routes in the mornings.

This is a true “value add” arrangement providing the best of both worlds with increased revenue generated for both the bulk or mini-bulk supplier and the homecare oxygen delivery company getting filled. Granted, there is no free lunch and both parties have cost benefit decisions to make related to return on investment and potentially higher direct costs for liquid oxygen. The potential off-set is savings generated from reducing Waiting Time, Transportation, and Talent wastes.

There is a funny twist for cryogenic tank manufacturers in this Cost Reduction series pointed out by a friend: “The more efficient companies become the less need there is for new delivery vessels.” Sure. This is true. Likewise- the more cost-effectively homecare companies can operate the more viable liquid oxygen remains as a solution for respiratory patients and providers.

Medical Oxygen Wakeup Costs Reduction B

The second method for reducing the costs associated with filling medical oxygen delivery vessels seems obvious to the level of ridiculous: Install a bulk liquid oxygen tank at the delivery company’s home facility. Often missed are the not-so-obvious challenges and innovative methods employed by some companies.

Typically, homecare oxygen companies considering installation of a bulk cryogenic tank need demand to be high enough to entice a delivery company to come fill their storage vessel and there needs to be a location at their site for semi-permanent installation of a tank. Also, their use level high needs to be high enough to avoid excessive product waste from boil-off evaporation. A company that owns their own facility with surrounding open space and has a use rate of over 1000 gallons a week usually has no problem meeting these conditions and probably already has a bulk tank.

A more interesting twist has been employed by some companies with less demand and/or the inability to get approval for installation of a bulk tank. Several have chosen to purchase a portable bulk tank and operate much like the old book-mobile or roving library. These companies are buying mid-sized (500-850 gallon) portable liquid delivery vessels and truck or trailer mounting them. They are then taking their liquid oxygen vessel to their main site or a satellite facility and parking it so that their delivery drivers can fill more quickly and conveniently without waiting in line at the main liquid supplier. It is also possible for them to tie this liquid source into a small fill system to charge gas cylinders. Some are getting their portable vessel filled in the field by liquid suppliers who bring the liquid to them. Others are still driving to the main supplier for liquid oxygen, but they are greatly reducing waste by having only one truck go to the supplier instead of several. Time is also saved since they are able to schedule their pickups at lower demand times and avoid long lines.

At last night’s SMEI (Sales & Marketing Executives International) Houston chapter inaugural meeting one participant commented that there are a dozen different ways to DO things right. The emphasis remains on the “do” verb.

Reducing Wakeup Costs for Medical Oxygen Delivery A

Yesterday we hit on the costs of “Waiting Time” waste for companies cued up to get medical oxygen delivery trucks filled and associated Process, Transportation and Talent wastes. The first method identified for reducing this cost is the use of larger vessels for liquid oxygen delivery. A number of companies who had been using 160liter liquid cylinders or “119” gallon delivery vessels moved up to 210, 290 or 500 gallon cryogenic tanks. The additional capacity has allowed them to visit many more patients between fills resulting in both increased revenue and cost savings.

The expense of getting to the first medical oxygen delivery each day is substantial and opportunity costs of inadequate supply can be high. It can be both frustrating and costly to get to a cluster of clients 30 minutes or an hour from home base and run out of liquid mid-afternoon. This commonly occurs when it is too late to go refill and return meaning that there was not only waste on the front of the day, but also on the end. For those who must return to meet critical patient needs it means an extra trip back and the likelihood of overtime costs.

A company moving to larger cryogenic tanks might find they can even reduce the number of trucks in service while still growing their client base. Some have been able to move from five 8-hour days to four 10-hour days. If it takes 1 hour to get out each day and you do this for 4 days a week instead of 5 then labor related “wakeup costs” are reduced right away. The return on investment is compounded greatly when cost savings are accompanied by elimination of missed opportunities at the end of the day.

An even higher level of performance is achieved by a few companies that not only fill individual liquid oxygen containers, but also deliver to other medical oxygen providers and fill their cryogenic tanks in the field. This results in a true win-win for both parties who are simultaneously increasing revenues and reducing costs.

One of the most interesting aspects of acquiring larger medical oxygen tanks and trucks is the availability of funds from third party investors. Savvy financial sources understand that a move to larger vessels can improve financial returns and several are receptive to funding value strengthening moves.

Medical Oxygen Wakeup Costs

A bulk medical oxygen provider told me recently about the lines of drivers they have many mornings waiting to get their truck-mounted vessels filled for that day’s delivery runs. Several others confirmed that it is such a trend that a lot of the homecare delivery drivers have purchased personal DVD players to watch movies while they wait in line.

One of the main costs Lean Methods focuses on is “Waiting Time” waste. This situation is amazing if you consider an average work year of about 200 delivery days and the cost not only of waiting, but also getting to the plant, filling and then actually getting out to respiratory oxygen patients. This adds Process, Transportation, and Talent wastes and instantly begs the question of how others might be avoiding or limiting these costs. There were some interesting answers that we’ll explore in greater depth in future posts. They include:

-Use larger cryogenic tanks in trucks to cut down the number of fills required annually;
-Install bulk tanks at depot facilities to avoid going to vendors;
-Acquire larger portable tanks to use for remote depot and field filling;
-Outsource filling services;

Please share other ideas if you have them and we’ll work more on this and a couple of related issues over the next few days.