Building on the Past

When Shawn Parker sits back and takes a long, hard look at the home medical equipment business, he doesn’t see problems. He sees possibilities.

Parker, president of Melbourne, Fla.-based Parker Healthcare Products, and his partner and brother Tim, head of marketing, are continually ramping up their company’s services.

That zeal for trying new and innovative ideas is paying off. Parker Healthcare, at present a single branch operation, has plans for several additional offices in central Florida; it’s in the process of becoming accredited; and, according to Shawn, it will be a player in every aspect of competitive bidding when that program is launched next year.

“We are doing great business,” he says, with a ring of pride in his voice. He and his brother are doing their dad proud.

What’s in a Name

Their dad is Harvey Parker, a legendary HME provider in Florida. In 1971, Harvey, whose background was as a pharmaceutical rep, opened the first HME company in central Florida. He was among the founders of FAMED, the Florida Association for Medical Equipment Dealers, and wrote the group’s code of ethics. And he was the one who got Shawn and Tim involved in the HME world.

“I had four sons (Shawn, Tim, Todd and Terry), and after school, they came and helped me in the business,” says Harvey. “I never thought any of them would end up in the business. I sent all of them to college and thought they would go into different disciplines, but they all sort of migrated back into the industry except for Terry, who became a pilot for Delta Airlines.”

Shawn well remembers working for his dad as a teenager, delivering the bulky “H” tank oxygen cylinders and even the first concentrators (“about as big as a big TV in those days,” recalls Harvey). That led to his becoming a registered respiratory therapist and, after his dad sold the company to a hospital, he signed on with Linde Home Health Care, now Lincare. Then in 1989, Shawn and his former wife Denise started their own HME.

“We just took off,” he says. “By 1998, we had four offices throughout central Florida and almost 50 employees.” Those employees also included Shawn’s mom Robbie, a registered nurse and certified mastectomy fitter, and his three brothers. And in a fanciful turnaround, Shawn even hired his dad to handle the company’s Orlando office.

Eventually, Shawn sold that company to Lincare. “Between the education I got working for my father and the management education I got from Lincare, it’s made me a better person in this business,” he says.

Shawn then turned his hand to insurance and real estate. Harvey remarried and moved to Colorado. Robbie went to work part time. Tim became a pharmaceutical rep. Todd went into the construction business, and Terry became a pilot.

But Shawn’s heart was in HME, so in late 2001, almost as soon as the non-compete agreement tied to the sale of his former company had lapsed, he opened another home care company.

Proud of the family’s cumulative expertise in HME and eager to work with his family once again, Shawn hired back his mom, brother Tim to take on the marketing aspect of the business and brother Todd as service manager.

Although dad Harvey was happily retired by this time, Shawn wanted to carry on his father’s legacy and build on the Parker name, so he called the new company Parker Healthcare Products.

But while the name may be the same, the industry is not.

Second Time Around

“It was easy to get back in,” says Shawn. “The only difficulty was keeping up with the changes. It’s unbelievable.

“With the constant reimbursement cuts and with all these pressures being placed on our industry, it’s getting harder to compete,” he confirms.

In order to be viable businesses today, HME companies need to offer quality products and service by licensed, capable professionals, he says. He thinks they also need to broaden their services.

“[Providers] can’t just focus on respiratory anymore. Only the larger companies like Lincare and Apria can focus on respiratory. The smaller companies will have to broaden their wings and take on different product lines,” Shawn contends.

He practices what he preaches. His newest company started out in a 500-square-foot facility; inventory was stored in huge bins. Now, the company is housed in a 6,000-square-foot building that includes a spacious retail store and its own billing center. In addition to oxygen, Parker Healthcare concentrates on rehab, enteral feeding and the sleep sector. The company is also starting up a home ramp business.

Employees include two registered respiratory therapists, two registered nurses and several licensed medical assistants.

“Although the HME industry is not a skilled nursing industry, having professionals on board helps you communicate with skilled nursing agencies and other medical professionals,” Shawn explains.

He is a proponent of establishing relationships with synergistic organizations such as nursing facilities, hospice organizations and the like. “You’re not going to be able to survive if you can’t get your equipment to someone and have other professionals work with it. Say you have a trach patient. You can’t insert or do anything with the patient and the trach tube. You must communicate with the nursing agencies.”

Shawn is stepping out of the HME box with other efforts. He teaches cardiopulmonary resuscitation and offers CPR classes to doctors’ offices to keep their staffs in compliance. He’s a licensed health care risk manager and a certified OSHA instructor.

“What I do is help doctors’ offices and health care facilities come into compliance with the many regulations,” he says.

The latter is how he came to realize the need for home ramps for patients using wheelchairs, which, of course, sparked the company’s new ramp business.

Parker Healthcare also offers continuing education unit courses to physicians.

But Shawn thinks the most innovative thing the company is doing is to loan its patients portable oxygen equipment. With Parker Healthcare’s proximity to the cruise terminals at Port Canaveral and the state’s large population of “snowbirds,” he saw an opportunity to provide a unique service. He invested in a number of portable oxygen units and decided to loan them to his patients for free.

“If you’re our patient, you’re going to be able to take [portable oxygen on a trip] at no cost to you and eliminate the transportation problems,” he says.

The program has been a solid success. “We actually have patients reserving them way ahead of time so they have one for their trip,” he says. “It’s kept our patients from leaving for other companies, and it’s bringing other patients to us.”

With brother Tim at the helm, the company has marketed the service to area travel agencies. “And I’m marketing to my own competitors. Of course, we charge them for the use of our equipment,” Shawn says.

Into the Future

All of that, Shawn believes, will help Parker Healthcare thrive in the coming years, even in the face of industry changes. But it won’t be easy, and Shawn admits he is concerned about the Deficit Reduction Act’s cap on oxygen reimbursement.

“The oxygen cap worries me. I see a tremendous number of service problems. How are people going to get paid, how are [HME] companies going to be paid — that hasn’t even been addressed,” he notes.

He also worries that unscrupulous dealers will “stick customers with horrible equipment at the end of the cap time.” And what will happen to those patients then, he wonders?

In a minority among independent HME providers, however, he is cautiously optimistic about competitive bidding. “I think it can be a good thing,” he says. “There needs to be some conformity in regard to payment structure.” But he believes that everyone needs to be able to participate at the bid rate, even if they don’t win the bid, and he is hopeful that the Hobson-Tanner bill will move through Congress before competitive bidding begins. (H.R. 3559, introduced last summer by Reps. David Hobson, R-Ohio, and John Tanner, D-Tenn., seeks to protect smaller HME providers under Medicare’s DME bidding program.)

Shawn says that he does plan to bid in every segment when the CMS program is implemented.

Despite the uncertainties and upheaval in the HME industry, he expects Parker Healthcare Products to be around for a long time — perhaps into the next generation. Now that they are old enough, Shawn’s children work part time for the company. Daughter Taylor, 18, has done some light marketing and helps coordinate the mountains of paperwork. Son Chase, 16, cleans and picks up equipment.

Will they take over the business someday? Shawn doesn’t know the answer to that question. “But they’re proud of the family, proud of their name,” he says.

And what does Harvey Parker, the one who started it all, think of this newest family business?

“The boys are professional, the boys are well-adapted to the business,” he says. “They know what they are doing. They have a high degree of integrity. They provide service, and that’s the main thing I’ve always taught them.

“It’s not the billing, it’s the service. You’re helping people who require assistance, whether it’s getting the right wheelchair, the right cane or the right hospital bed. I think these are the principles they have carried on.

“I’ve seen those guys give away products [to people in need], and that makes me happy,” he continues. “If you can’t afford it, they’re going to take care of you as far as they can go. They’re not going to turn you away. That’s not the principle of a Parker.”

Company Snapshot

Parker Healthcare Products

• Full-service home medical equipment provider with emphasis on respiratory, rehab equipment and enteral feeding
• One location (including a retail store) in Melbourne, Fla.; plans to open other branches throughout central Florida
• 23 employees
• Pursuing accreditation through the Joint Commission on Accreditation of Homecare Organizations (JCAHO)

Parker Principles

In his years in the home health care arena, Shawn Parker has found some enduring tenets for success. Among them:

• Hire quality, competent people who “have a heart for the business and want to be in it,” Parker says. “You’re only as good as the people around you. If they enjoy their work, they’re going to make your company successful.”
• Use innovative ideas to keep your patients. Offer new services that you may not be reimbursed for but that might keep your current patients and bring others to you.
• Expand. “You can’t stay in one place and expect business to come to you,” says Parker. “With competition being what it is, you have to expand.”
• Become accredited and participate in competitive bidding. “You have to get yourself in a position where you are in the circle of accreditation and competitive bidding. Then you’re going to stay alive,” Parker says.
• Market your business and consider establishing relationships with synergistic companies such as nursing agencies, hospice organizations, assisted living facilities and support groups for seniors.