The Parable of the Mom & Pop

If ever the home medical equipment industry needed a modern-day fable of how to succeed in the face of competition and corporate takeovers, now is the time, and the story of Rapid City, S.D.’s Breathe EZ Oxygen and Respiratory Supply is that tale.

In the 1980s, Ella Mae Bell and Vern Shafer each launched promising careers in HME, Ella as a customer service representative and respiratory therapist at Shell Medical in Rome, Ga., and Vern as an employee of his sister and brother-in-law’s Pulmonary Services Inc. (PSI) in Sioux Falls and Rapid City, S.D.

As they worked, both were promoted to location manager. Ella managed a staff of six for eight years, while Vern’s family business grew large enough to warrant a 6,000-square-foot location.

“Like many other [HMEs] at that time, we had become caught up in the ‘everything-to-everybody’ mindset,” Vern says. “We set up large showrooms in our facilities, filling them with all kinds of things from nursing uniforms to diapers and everything in between. We had a rehab department where we built customized wheelchairs, and we had a full maintenance department for overhauling concentrators and fixing whatever needed fixing. We supplied liquid oxygen and had a transfill system capable of filling 80 small compressed gas cylinders per batch. We did it all. We were everything to everybody.”

Indeed, Ella, Vern, and their respective companies were so successful that they caught the attention of the same large, national HME provider. Ella eventually became the national company’s director of marketing for Georgia. Vern remained location manager at his original business, although the company now flew the national provider’s flag. Business was good.

For Vern, however, the transition was hard, with changes happening quickly and a new corporation calling the shots. “I wasn’t used to having someone else tell me what was best for my location. I had always run my location with the idea that the patient comes first — always. If you take the best possible care of your patients, your patients will be happy. If your patients are happy, your physicians are happy. If your physicians are happy, your business will grow. This philosophy had always seemed to work in the past, and I didn’t see any reason to change.

“However, I was being asked to change, actually, told to change,” he continues. “‘Time is money, Vern, and you need to spend more time making more money!’”

Vern took a break from the business for awhile, but returned to handle accreditation for the national provider, first as regional compliance coordinator and eventually as national director of accreditation services.

“Compliance, as it turned out, was a good fit for me,” he says. “It fit with my philosophy of putting the patient first, always. That is the simple nature of compliance: making sure you’re taking good care of your patient.”

Vern traveled the country, helping the provider’s locations obtain accreditation through the Joint Commission on the Accreditation of Healthcare Organizations. Eventually, Vern’s job took him to Georgia, where he met Ella. The two rising corporate stars married and continued on their trajectory. Both, however, secretly pined for the days of “doing things the Mom-and-Pop way,” Ella says, “simply taking care of the patients, [giving] the referral sources what they ask for and [knowing that] growth will come.”

Now under new administration, the national provider gradually seemed to the couple to be moving away from this ideal. “We watched our friends and family members [who had been working for the national provider] drop by the wayside [due to] ‘reduction in force,’” Ella explains. “More than ever, it seemed we were being asked to spend even more time to make even more money. It was time for us to go.”

The Shafers didn’t have to look far for a new business. An investment group had approached the couple about starting a new HME company in Rapid City. Even though several national providers and a couple of privately owned HMEs were well-established in the town, the Shafers didn’t give it a second thought.

“Armed with more than 20 years’ of experience in operations and compliance, along with Ella’s unique marketing style (see accompanying ex-planation), we felt like we could make a difference and would be successful,” Vern says. “We joined the investment group, threw up our shingle and haven’t looked back.”

The new company, Breathe EZ, specializes in respiratory services but also provides other equipment based on its patients’ needs. Despite its competition, the operation is growing and has expanded into Wagner, S. D., according to Vern, who has remained active in the home care compliance arena as a certified health care fraud and abuse compliance officer and a member of JCAHO’s Home Care Advisory Board.

The moral of Ella, Vern and the Breathe EZ story? Says Ella, “Stick with the basics. Care about the patient, and everything will fall into place.”

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Still not convinced? Consider the alternative, Shafer says: Try growing your business with federal marshals wrapping yellow tape around your transfill system and delivery vehicles, half your employees out on workers’ compensation leave and the other half considering a walk-out, the [Federal Bureau of Investigation] coming through your door to discuss your creative billing techniques, the [Veterans’ Administration] threatening to pull your contract because you failed your last JCAHO survey and a “60 Minutes” van sitting out in your parking lot.

“I’ll take being in compliance any day.”

Vern’s Compliance Philosophy

“If you are going to be in [the home care] business, you had better be ready to jump through a few federal hoops,” says Vern Shafer.

The federal agencies ready to make home care providers jump include the Food and Drug Administration (because oxygen is defined as a drug) and the Centers for Medicare and Medicaid Services (if you bill through Medicare or Medicaid), as well as the Department of Transportation (because oxygen is considered a hazardous material) and the Department of Labor’s Occupational Safety and Health Administration (for keeping your employees safe). Add to that list an accrediting organization.

If this seems like too much red tape to untangle, take a lesson from Shafer, who says if you understand the root cause or reason behind them, the laws and regulations are easier to understand and deal with. Shafer views the regulations as follows:

• “What does the FDA want from us? They want us to be sure we’re providing a safe product to our patients.”
• “CMS? They want to make sure that we’re giving our patients a fair financial deal.”
• “DOT? They want us to make sure the other folks sharing the streets and highways with us will be safe from harm.”
• “OSHA? They want us to take the precautions necessary to keep our employees safe from harm while on the job.”
• “The accrediting bodies write standards for us to follow that encompass the above regulations and also serve as a guide in providing a good and common service to all of our patients.”

Abiding by the rules of so many federal agencies will help you grow your business by keeping your patients happy, Shafer believes. “You provide a good service, your products are safe and [delivered] in a safe manner, and you give your customers a fair deal. Put in those terms, it doesn’t seem all that unreasonable, does it?”

Plus, says Shafer, considering the alternatives, “I’ll take being in compliance any day.”

Ella’s Marketing Style

Are you interested in breathing new life into your marketing plan? Try Ella Shafer’s version of CPR, which stands for “Caring Personal Relationships.”

As a respiratory therapist, Ella is able to bridge the gap between oxygen patients and their physicians.

“When I visit patients’ homes, they are comfortable asking me questions about their disease and concerns they have,” she says. “I take that information back to the physician. This process helps build the bridge [among] the three of us. Our common bond is the patient.”

Ella and her husband, Vern Shafer, say these actions are the result of “old-fashioned” common sense. “We earn the respect of the patient and physician by simply caring about the patient. It all sounds so simple — and it is. All you have to do is care.”