Except being reliable, each medical device put on the market must also be safe and never operate or fail in a way that can be harmful to the user. An important factor determining the market success or failure of a medical device, as well as if a medical device will cause death or injury, is the cost. Thus, this post presents some of the most used costestimation methods directly or indirectly concerned with medical device safety.
 LossEstimation Model
This model is used for estimating the loss in dollars that a medical device manufacturer will have. The expected loss or risk can be calculated by using the following mathematic equation:
where:
 m  the number of accidents.
 α  expected loss per accident.
 θ  predicted or estimated accident rate.
 T  time or another measure during which the accidents happened or could happen.
 Heinrich Method
This approach is named after H.W. Heinrich who argued more than half a century ago that for each dollar or insured cost paid for accidents, there were four times more uninsured costs (aka indirect costs) to the organisation. Unfortunately, it is very tricky to state both direct and indirect costs of accidents clearly. However, Heinrich developed the following mathematic approach that could help estimate the indirect cost of an accident:
where:
 C_{ia}  indirect cost of an accident;
 CLTM  the cost of lost time by management;
 CLD  the cost of lost orders, etc.;
 CMD  the cost of the machine or material damage;
 CLTNI  the cost of lost time on the case by first aid and hospital personnel not compensated by insurance;
 CLTIW  the cost of lost time of injured workers;
 CWM  cost due to weakened morale;
 OCIWNS  the overhead cost for the injured worker while in nonproduction status;
 CEWS  employer cost under welfare and benefit systems;
 CCWE  the cost of continuing wages to employees;
 CLTESW  the cost of lost time of those employees who stop work to watch or are involved;
 CLP  the cost of profit losses on worker’s productivity due to idle machines or equipment.
 Simonds Method
This method was developed by, and named after, Professor Rollin H. Simonds. It is based on the assumption that the cost of an accident can be divided into the following two categories:
 Insured costs – The estimation of insured costs is easy and straightforward, and it can be done by simply examining accounting records;
 Uninsured costs – Simonds argues that, although it is challenging to estimate the uninsured costs of accidents, it is not impossible, and it can be done by dividing accidents into four groups and using the following formula:
In the formula above, Cui represents the uninsured cost of an accident, Ci is the average uninsured cost due to the ith Class accidents where i = 1,2,3, and 4, and:
 α1 is the total number of working days lost due to Class I accidents which results in temporary total and permanent partial disabilities;
 α2 is the total amount of physician cases because of Class II accidents;
 α3 stands for the total number of firstaid cases due to Class III accidents;
 α4 stands for the total number of noninjury cases due to Class IV accidents.
 Medical Device Safety Life Cycle Cost Model
The medical device safety life cycle cost model is used to estimate the cost of safety for a medical device over its life cycle. Mathematically, it is defined by:
where:
 MDSC stands for the cost of safety for a medical device over its entire life span;
 R_{eim }is the reimbursement;
 L_{acc} is the accident and claim loss;
 C_{app} represents the cost of the accident prevention program;
 C_{ins} stands for the cost of insurance;
 C_{rec} is the cost of recalls.
 Accident Prevention Program CostEstimation Model
This model can be used to estimate the cost of the accident prevention program. Mathematically, it is defined by:
where:
 C_{app} is the cost of the accident prevention program;
 RE_{eim} represents the reduction in reimbursements;
 C_{ra} shows the recall cost that can be avoided;
 C_{aca} stands for the cost of accidents and claims which can be avoided;
 S_{inp} represents the savings in insurance premiums.
Source:

Dhillon, B., “Medical device reliability and associated areas”, Published by CRC Press LLC, 2000.
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