As home medical equipment providers make their way to Orlando
for Medtrade 2004, the venerable trade show's 25th annual
conference and expo, visiting Disney World (though it's a fun
extra) is not their top priority. Instead, owners, managers,
equipment buyers and other HME professionals say they will be
looking for the products and information that can help them shore
up business for 2005, which many predict could be a rough year.
They tick off concerns including reimbursement cuts on oxygen,
beds and other products, drastically slashed payment for inhalation
drugs, uncertainties about power wheelchair coverage and pricing,
impending guidance on supplier standards from the NSC and, looking
further out, the implementation of competitive bidding. But
toughened over the years by numerous legislative and regulatory
twists and turns, providers in general say they are optimistic
about dealing with these issues — and any others that might
come their way.
Wendi Phillips, director of accounts and marketing at Wichita,
Kan.-based Hart Pharmacy & Home Medical Equipment, is looking
forward to the show and says her company's focus will be on a broad
range of products. “We deal with everything from oxygen and
POVs to CPAPs, and we do pharmacy and compounding,” says
Phillips, who explains that an emphasis on quality will dominate
her product search at the show.
But Phillips is also apprehensive about the coming year, and
says the sessions that deal with accreditation will be of special
interest. “It is scary to know that in our business we have
to rely on insurance,” she says. “The other thing that
is scary is that we know [mandatory] accreditation is coming down
the pike. We want to make sure that we know what we are doing [to
get ready for] accreditation.”
“We always like seeing new products at Medtrade,”
says Derick Fontanez, operations manager of JRS Medical Supply and
Oxygen, which is based in Orlando, “but this year we will
probably be looking at the conferences.” Fontanez says
reimbursement cuts are the main problem he sees for 2005, and he is
hoping to gain some insight about the cuts that are now set to take
effect in January — and exactly how deep a dent they will put
in his business.
Then again, he notes, reimbursement “is always a
problem.”
As general manager of Richmond, Va.-based Roberts Home Medical,
Bob Evans echoes concerns about “government intrusion and
reimbursement cuts” that can put “pressure [on
providers] to reduce the quality of service.” In between
walking the aisles to look at the latest respiratory and rehab
products, Evans says, he, too, will be looking for education from
this year's show.
GOOD VENDOR RELATIONS
“I'm frustrated because we are almost to January, and I
still don't know how to plan for those cuts,” says Jerry
Woolam of Star Medical Equipment, Lubbock, Texas. While seeing new
products is always worth the trip to Medtrade, he continues,
“We are especially interested in trying to negotiate with
vendors to see if we can find better products [for] better
pricing.”
Woolam stresses that with the ongoing pattern of Medicare
payment decreases, pricing will be a key factor in the future
success of his business. Vendors are going to have to “share
the loss,” he feels.
The Texas provider adds that he intends to make whatever
business adjustments are necessary to survive while still providing
adequately for his customers. “There won't be a lot of
customer service cuts. We are still going to provide our customers
with what they need,” he says, “but we will have to
reevaluate all of our spending.”
“[The cuts] will make it more important to maintain really
good relationships with manufacturers so that we are able to get
good terms and good discounts,” agrees Matthew Burke,
director of operations at Burke Medical Equipment, Chicopee, Mass.,
and chairman of the American Association for Homecare's Rehab and
Assistive Technology Council (RATC).
Although equipment prices remain important, Burke points out
that sacrificing quality is not an option. “I'm very
concerned about the fact that more and more products are being
manufactured offshore, which has led to a focus solely on the
cheapest product. I want to make sure quality is not
forgotten.”
Choosing the right company to work with can make his job
simpler, Burke continues. “It's a matter of selecting the
right product from companies that are easy to work with, are
efficient and that make us more efficient. We can't do business
with companies that don't help us to be more efficient. An example
of things that can help are companies that offer electronic
purchasing options, like Web-based, or EDI (electronic data
interchange), purchasing. Those companies that refuse to get a Web
site and insist that you fax an order need to modernize or [they
may] die.”
Despite any problems, Burke is committed to the industry and to
keeping his company strong. “The good and the bad thing about
our business is that the need is not going to go away. People are
always going to need wheelchairs and medical equipment;
unfortunately, that is the reality. But if you look at it from the
traditional business [view], the demand is always going to be
there.”
EDUCATION, INFORMATION
While some providers say they are interested in Medtrade's
general tracks, others say they are counting on seminars geared to
their particular area of business for education and information.
“The seminars always have good speakers, and [the topics are]
day-to-day stuff that is pertinent to our operations,” says
Thomas Gloyer, owner of Tomball, Texas-based Home Health Store.
Gloyer expects to do a lot of networking at the show and to talk
with other providers in business operations and reimbursement
sessions.
Gary Salazar, president and CEO of Mobility Giver Inc., a custom
rehab provider in Huntington Beach, Calif., plans to attend
seminars with a seating and positioning focus. He says the current
reimbursement climate has made him wary of Medicare and Medicaid
business “because you are not ever sure — even if you
are authorized — if they are going to pay you.”
But Salazar also sees opportunity in the industry's changes.
“There is going to be a push to have qualified people doing
the business, and we are one of those companies,” he states.
“Some companies have not been professional in their business
practices … and it's going to be harder for them to do
business. That is going to give more opportunities to the companies
that are doing business the way it should be done.”
Glenn Schrader, president of Low Country Home Oxygen, Hilton
Head, S.C., says he will be jumping between sessions in the show's
respiratory track and others in the business operations area. He
hopes by the conference end to be better informed on how to prepare
for the coming cuts, specifically nebulizer medications. “I
think the oxygen cuts are survivable,” he says, “but
the medication cuts concern me.” He proposes that his company
might have to shut down its pharmacy and drop its respiratory meds
program, following large providers that have announced they may be
forced to exit this portion of respiratory business.
To combat the potential loss of income, Schrader anticipates
expanding his product line and branching into other categories.
“We are getting into rehab and high-tech wheelchairs,”
he says. “We are just trying to stay in our neighborhood and
keep growing. With the potential oxygen cuts and nebulizer
medication cuts, it just seems healthy to make sure we have a Plan
B.”
Phillips says her company will take a different approach.
“We are going to have to look at more cash business versus
insurance business,” she says, adding that there is
opportunity in “knowing that our industry deals with the
aging population and the baby boomers, and then also taking care of
their kids. This is a great industry to be in. How you look at your
cup — as half full or half empty — determines how you
think your business is going to do.”
“I've been in business for 22 years now,” sums up
Schrader. “We [as an industry] were supposed to go out of
business many times … We will survive, we'll change. The
demographics are great for our business. We will have to get a
little more efficient, but I'm very optimistic for the
industry.”
