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Member Feedback Reflects Challenges and Opportunities in 2015 and Beyond

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HME businesses are feeling the pressures of audits and decreasing margins, but the entrepreneurial spirit of providers is still alive and strong, and showing many opportunities for 2015. In late 2014, we conducted a three-question survey of HME providers who attended Mark Higley’s Fall Seminar sessions. Fifty-seven participants gave multiple answers, giving us insight into the challenges, opportunities and dreams ahead. We found that many of the attendees had Medicare contracts on their minds, which makes sense because they were attending a session about competitive bidding. But more often than not, providers were also considering other ways to diversify payer source and product offerings to increase their chances of success.

Challenges
Billing and Audits - Mentioned by more providers than any other challenge, the issue of audits, billing and compliance is rightfully on the top of many minds. What many don’t know is how much the implementation of the Affordable Care Act justifies these concerns. In late 2014, CMS issued a Final Rule giving them the ability to deny or revoke the enrollment of businesses or individuals that pose a “program integrity risk” to Medicare. This includes providers, suppliers or owners that have unpaid Medicare debt, have a managing employee who has been convicted of certain felony offenses, or that show a pattern of billing for services that do not meet Medicare requirements. It’s more important than ever for all providers and suppliers to have an effective Compliance Program that encompasses consistent auditing and monitoring of claims. Customizable and personal programs such as those offered by The van Halem Group, will assist in avoiding government audits or investigations, and prevent your Medicare enrollment from being denied or revoked. The programs include a variety of training opportunities. So not only can your claims be reviewed for a more immediate improvement, but your staff can receive training by experts who have in-depth experience navigating the various agencies and contractors that make up the web of compliance. Learn more and stay on top of compliance conversations by following The Details Matter, a blog from the van Halem Group. We’ll also email you their articles in future Connect editions. Cash Flow – Business Financial Success Competitive bidding has put the squeeze on providers who are seeing decreasing margins. Audits are tying up funds, and providers are finding it necessary to do something new. In many cases, it requires a comprehensive business analysis to better understand where there are opportunities to cut expenses and improve overall operational efficiency. There are no simple solutions. But recognizing and accepting the need to make changes is a critical first step. The days of $325 oxygen-for-life are over and are not coming back. There is money to be made in the business, but to realize success most providers must make changes. Getting better at repetitive business processes, perfecting your core activities, understanding your cost structure and knowing your numbers are all part of the solution. Smarter purchasing, to optimize both price and value-add offered by some vendors, is also part of the strategy. We’ll make sure to cover these topics often in our upcoming issues, to help provide you with solutions to consider. Market Share Growth Coming in third for the biggest challenge going into 2015 is growing market share in key business segments. For most of us, volume growth is a necessary part of the successful equation. Several mentioned the need to expand their business regionally and grow by finding new referral sources. A number of VGM members have found Market Data to be the perfect tool to pinpoint new referral sources in order to grow their business. Market Data provides access to the largest physician-level DME claims database in the country and allows a provider to identify referral sources throughout a territory and value them based on the volume of DME products prescribed. Imagine knowing the name, contact information and referral patterns of all the doctors in your region that prescribe your product. Not only could you identify who to approach, but you could also seek out complementary business opportunities by analyzing the data. “Fish where the fish are” articulated one of our members who uses Market Data.
Opportunities
Baby Boomers and Their Habits - Market trends are providing many opportunities for providers that choose to weather the storms of decreased reimbursement and narrowing by payers. Survey takers most commonly noted the increasing baby boomers population as the greatest opportunity going into 2015 and beyond. The youngest of the boomers will reach age 90 during the next 40 years, so business efforts taken to appeal to their wants and needs will pay off. So what do they want and need? They will have a real need for health care. Seventy-two percent of boomers have one or more chronic diseases. Fifty-eight percent have high blood pressure and 28 percent have diabetes. Meanwhile, 82 percent of people over 50 use the Internet to research health and wellness. Baby boomers are savvy shoppers and want to choose the products that suit them best. They prefer to age at home and will be seeking the services you provide. A few savvy providers mentioned e-commerce activities and expanding the retail business to accommodate cash sales. Before getting into e-commerce, read this blog post from Forbin discussing important things to keep in mind.
The Great Ideas Providers Have Imagined, but Have Not (Yet) Acted Upon
Retail and Private Pay – Diversifying business with retail opportunities was most commonly mentioned as an idea providers were thinking about, but had not yet acted upon. Retail offers the opportunity to diversify products and payer source. It also gives baby boomers the health care shopping experience they seek. Taking on a new retail venture is a multi-step process. Providers must consider merchandising strategies, training and incentive programs for staff and even the details about what products to sell. VGM Retail Services has been an excellent resource for VGM Members who are looking for new opportunities. For great photos of before-and-after retail spaces, click here. The photos are posted under the “Solution” boxes.

 

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