Success is in the pennies. In a market where profit in dollars is becoming increasingly scarce, Ford C. Greene, CRT, LCRP—founder and owner of Greene Respiratory Services headquartered in Milford, Ohio—is keeping a keen eye on the lowly copper coin, and it is paying off. “I don’t worry about the dollars anymore,” he says. “I chase pennies. If you get enough pennies, you get a dollar.” In business since 1990, Greene has discovered that the way to stay afloat in the respiratory and home medical equipment business, which is constantly awash in changes, is to continually monitor his business practices, shore up his bottom line with a variety of payer sources and be able to swiftly alter the course when necessary. This means that today’s business doesn’t look like yesterday’s—or even tomorrow’s.
The Table Leg Equation
Greene Respiratory has reinvented itself several times in the more than two decades it has been in business. Greene, a hospital director of respiratory care, partnered with the hospital’s medical director to open the company. “It was back in the day of the nationals, and we would follow our patients when we sent them home. We noticed that they didn’t get their equipment for sometimes two weeks,” he recalls. “The priority for doing the setup the same day just wasn’t there.” The lack of same-day setup created hardships for the patients, who often ended up back in the hospital. Greene and his partner believed they could change this problem by providing same-day service and superior care—an idea that produced Greene Respiratory Services. It was strictly respiratory then, with the medical director reviewing policies and writing a clinical policy manual. Having its own medical director to help oversee clinical care was a big selling point for the company, Greene says, but when the director sold his share in the company, Greene didn’t replace him. Instead, the director continues on with the company on a consulting basis, reviewing policies and procedures. While the respiratory business was successful from the beginning, it soon wasn’t enough to comply with patient needs, so Greene added durable medical equipment to the mix. “I probably do more DME than respiratory now,” he says. Since then, he has expanded even further beyond DME. The once singular store near Cincinnati has developed into four separate locations, two of which are retail. The geographic reach is broad—two stores in Ohio, one in Indiana and one in Kentucky. Greene is always looking for ways to broaden the company’s scope. “I liken this business to a table,” he says. “A table usually has four legs. The more legs you have under it, the more stable it will be.” So over the years, Greene has continued to add more legs. “Our product mix and revenue stream are varied,” he says. “I have probably eight or 10 legs under the table.” In addition to respiratory, DME and retail, Greene Respiratory offers rehab equipment, racing bikes for vets and a variety of services to help people stay at home. “We are leaning heavily on the population that has expendable income and wants to stay at home.” Instead of seniors selling their homes and property and basically disassembling their lives, Greene says he and his staff can help them age in place. He employs the services of both inside and outside contractors to handle the work. “We will rehab your house, we’ll put in lifts, extra-wide doorways, elevators—anything that it will take to keep you in your home, we will do it,” he says. The purpose of having extra legs under the table is so that it isn’t quite as disabling when one of them breaks off. Greene knows that from personal experience. When Medicare’s competitive bidding program was introduced, Greene Respiratory bid on several product categories, including enteral and respiratory. The company was awarded a contract for enteral, but made the decision to turn it down. “It was laughable,” Greene said, explaining that there was no way his company could have turned a profit. “And here we are a respiratory company with a big footprint in Cincinnati, we put in a legitimate bid and we did not get the contract.” Declining that award turned out to be a good choice, because three of Greene’s competitors that accepted competitive bidding contracts have since gone out of business, he says. Still, losing that particular table leg was a big deal. It took 18 months to recover financially, but the table remained standing. That was likely not only because of the profusion of table legs, but because Greene was chasing pennies.
Passion for Pennies
Greene is sensitive to costs because of his time as a hospital director of respiratory care who now operates in a marketplace where “there are no flat-out savings points.” Each year, he reviews every procedure, asking himself, “Can I be more efficient? Can I save time?” Greene evaluates how much it costs for a driver to deliver respiratory equipment, for a biller to process a claim, for his staff to get signatures. “If it takes a certain amount of time [to get a signature], and if there is a technology that can save me 15 seconds 150 times a day, that adds up to a substantial savings,” he says. He also studies the way other companies do business—and he is not above borrowing some of those methods if it will save him money. For example, all of his drivers now have hand-held scanners like FedEx drivers. “It’s not cheap,” Greene acknowledges, “but they download to the system and they are ready for billing.” His drivers follow the UPS route design, only making right-hand turns. “The avoidance of left-hand turns and exposing yourself to a risk such as a wreck—it pays huge dividends,” Greene says. His 20 drivers log about 250 miles a day, journeying from the Tennessee border to the Michigan border and from Indiana to eastern Ohio. The company has a fleet-tracking program, which, among other things, allows drivers to call in and ask for directions when needed. “That absolutely saves time,” Greene says. Greene creates savings by shopping at auctions, too. Recently, he bought $50,000 worth of new CPAP equipment for $2,000. “Can I make a business on that? No. But does it augment the business? Yes,” he says. Green believes that chasing pennies is not only the present, but also the future of HME. While the customer base will always be there, he doesn’t think a viable company can rely on Medicare. “It literally comes down to the fact that Medicare and Medicaid are sorely underfunded,” he says. “Until they decide to put money [into them], it is not going to change. We’ll always be trying to do more with less.” The key to his company’s success rests on the addition of table legs and chasing pennies, he says, as well as being able to adapt quickly to the inconsistent business climate. According to Greene, “You may have to downsize, you may have to change, but you will not go out of business.”
Getting Down to Business
In his more than two decades in the respiratory and DME business, Ford C. Greene has lived a philosophy that is paying off for Greene Respiratory Services. Some keys to his success are: Embracing change in this industry. “I get out of bed knowing something is going to go wrong. That’s business,” he says. Evaluating business. “I’ve learned to look at it like a table, and I’m going to support it with as many legs as I can,” he says. “Don’t depend on any one payment system.” Keeping abreast of technology. Look at it as a way of being more efficient, more effective. “If you are more efficient, you are saving money,” Greene says, adding that he spent a lot of money years ago on an oxygen in-fill system. It took him 16 months to make up the money he paid for the system, “but then, the cost goes away.” Looking outside the industry. Keep an eye open for new ideas and applications that may help you do business better. Finding enjoyment in what you do every day. Impart that enjoyment to your staff, Greene says. The sense of job satisfaction helps get you past the bad days.