How an enterprise resource planning platform creates structure
by Wayne Bailey
October 2, 2018

There are few open channels of communication with DME providers’ main sources of revenue, and most providers have almost zero direct communication with payers.

The lucky ones are invited to a meeting where they are told about changes in policy or payment. This is not a discussion; it is a forum at which the payer announces rates and expects DME providers to figure out how to make things work.

When it comes to policy updates, most DME providers simply receive an email with a link to a website where updated policies are presented.

DME providers have always existed as the middle ground between critical patient service and insurance companies and until a few years ago, providers didn’t worry too much about communication channels between themselves and payers. DME providers sent claims and received adequate reimbursement. Billers were not tightly managed or monitored, and few technical systems were in place to enable an enterprise view of billing efforts and results.

With reduced reimbursement rates and almost no influence over or even communication with payers, DME providers have faced a tremendous crunch. Margins are now stringent due to cutbacks, and the documentation requirements have increased.

Despite this grim news, some DME providers are surviving and thriving, even in these difficult conditions. Their key to success? Advanced technology.

Optimizing Policy to Maximize Margins

Providers are optimizing their insurance policy flow with software and maximizing margins. However, to do so, providers must have highly-trained employees using highly-sophisticated workflow software.

Good software provides an enterprise view of the DME organization, including intake, inventory, documentation, delivery, billing and general ledger, including cost of goods sold (COGS) and profit/loss statements. Advanced reporting features and analysis are also essential.

When Billing Is Underperforming

Unless a billing department is being tightly overseen and optimized, it is likely underperforming. Missed deadlines, incomplete claims and other challenges stack up, and the billers are leaving money on the table without management realizing that it’s happening.

DME business software provides critical measurement and oversight that ensures the billing department is not underperforming. This allows owners to take control of their businesses. Real-time data about billing performance is the only way for DME providers to get in front of their businesses, rather than constantly playing catchup.

Enterprise Workflow Technology

In addition to optimizing billing, providers must also gain an enterprise-level view of their business and institute workflow rules to make sure that every element of the business is operating at maximum profitability.

An enterprise resource planning platform (ERP) is a type of advanced business software that allows providers to program workflow rules into the system. This means fewer choices for employees; fewer choices lead to fewer mistakes.

ERP software walks employees through every step from intake through delivery, and ensures they gather every piece of information and documentation they need before delivering an item. This means fewer trips back and forth to the warehouse, less time spent waiting for paperwork (everything should be electronic), fewer reimbursement resubmissions, and fewer non-reimbursable expenses.

Clear workflow processes built into an ERP means that DME providers can minimize costly mistakes and, when problems arise, they can even find the leaks and fix them. This is the benefit of a true ERP—it allows businesses to set structures in place for all their employees, and monitor results over time.

DME providers that embrace the enterprise approach to business with an ERP will be able to thrive on the 12 to 18 percent margins that are putting old-school providers out of business. It’s not too late to upgrade a business and succeed in the new market, but it’s not going to be possible to compete without the right tools in place.