Member Q&A: Maximizing Profitability for Your Business

Published in Wound Care on November 05, 2019

Below are a series of questions that focus on generating revenue within different areas of your business. Our experts hear these questions often in the marketplace or the questions have been submitted directly to us through member-exclusive tools. There are also topics from our latest VGM Playbook, “Maximizing Profitability for Your Business.”

Topic: CPAP Resupply

Q: Many providers are asking whether they should keep their CPAP resupply business inhouse or outsource it with the assistance of a vendor partner?

A: Let’s discuss the advantages and disadvantages of both.

In-sourcing advantages: more control, increased visibility, economies of scale

In-sourcing disadvantages: higher volumes, higher investment, dedicated equipment, supply chain problems

Outsourcing advantages: flexibility, lower investment, improved cash flow, lower labor cost

Outsourcing disadvantages: provider choice, loss of process control, longer lead time, information control

Here’s a tip if you’re considering outsourcing: provider’s don’t need to outsource 100% of their business. Providers should always remember to have a small amount of inventory in stock for new CPAP referrals. For instance, start small with just a portion of your inventory. Then lastly, when considering outsourcing and where to start, look at the variety of insurances your company works with. Maybe two to three payers are better with large volume business and you can have smaller payers solely focus on inhouse.

Source: VGM Playbook, Resupply Models to Improve Cash Flow by Ronda Buhrmester

Topic: Patients as Payers

Q: The patient payer model is changing. Patient healthcare costs are continuing to increase and nearly 50% of all patient financial responsibility is going uncollected. With this change, how can we start to view our customers as healthcare payers?

A: The truth is that the rate of healthcare providers to file bankruptcy has tripled in the last few years. The need to differentiate a payer mix is more prevalent than ever. To expand on traditional billing, start by expanding on your current resources. Train staff to engage with patients throughout the entire billing process by starting with how first-line customer service representatives are treating customers and then moving to a scalable plan that builds customer loyalty.

Source: VGM Playbook: Patient as Payer: Will You Be Ready? Six Tips to Help you Prepare by Jennifer Leon

Topic: Wound Care Profitability Discovery

Q: Specific to Wound Care, how can I discover profitability of certain product offerings within my business? In conjunction, how can I balance out any holes in my product portfolio?

A: VGM Wound Care has actually developed a downloadable calculator to help answer the question, “Can I be profitable in wound care?” This calculator allows you to assess your current state as well as explore expansion in wound care offerings.  VGM members can download it at vgm.com/woundcare. Reach out to Heather Trumm at [email protected] for log in credentials.

Topic: Leverage Your Marketing Budget to Increase Profitability

Q: How can my DMEPOS business continue to resonate and reach customers as well as maximize the return for my marketing budget?

A: As it relates to understanding your marketing budget, Forbin expert Thea Nicholson says, “There’s a difference between spending money because you know you should and spending money wisely.” With that, she suggests to hone in on maximizing your return on investment (ROI), developing a marketing strategy based on your business goals, and then establishing a budget to complement your strategy.

Source: VGM Playbook: Leverage Your Marketing Budget to Increase Profitability by Thea Nicholson

The Wrap Up

All topics are expanded upon in recent the recent VGM Playbook: Maximizing Profitability for Your Business. This VGM member exclusive resource can be downloaded here, playbook.vgm.com.


comments powered by Disqus

From Our Experts

Discover Why All Providers Need to Know About Wound Care thumbnail Discover Why All Providers Need to Know About Wound Care Listen in as we talk with Heather Trumm, Director of VGM Wound Care about the importance of all DMEPOS providers paying attention to wound care. Heather also covers new education materials available for VGM Members, and resources that can help you get started in wound care. Breaking Down PDPM and PDGM with VGM Wound Care and 3M thumbnail Breaking Down PDPM and PDGM with VGM Wound Care and 3M Reimbursement changes can be a challenge to keep track of in the healthcare industry. Heather Trumm, Director of VGM Wound Care interviews Yesenia Banks, Reimbursement Manager of 3M KCI, to help us better understand the recent Medicare reimbursement changes known as PDPM and PDGM. DMEPOS Warriors: Sue Currence, BSN, RN, WOCN for Austin Pharmacy & Medical Supplies thumbnail DMEPOS Warriors: Sue Currence, BSN, RN, WOCN for Austin Pharmacy & Medical Supplies Meet Sue Currence, BSN, RN, WOCN for Austin Pharmacy & Medical Supplies, a VGM member since 2016! As a wound, ostomy, and continence nurse (WOCN), Sue has a vast knowledge of the wound care industry. We asked Sue about her experience with wound care and its importance as a specialty in the home medical equipment industry. New Educational Courses From VGM Wound Care thumbnail New Educational Courses From VGM Wound Care Skin health affects every single customer of an HME provider. VGM Wound Care has the tools and solutions for the HME industry to thrive in the wound care market, including three new educational resources that have just been released. These “Wound Care 101” courses cover the basics of wound care pertaining to skin and the healing process, surgical dressings and debridement, and therapeutic support surfaces. Blast Away BioFilm with BlastX thumbnail Blast Away BioFilm with BlastX What is biofilm? Wound care clinicians know this term very well because it's a road block to wound healing. I recently learned about a new product and wanted to share. It's a product that will deconstruct and destroy biofilm and defend the wound from recolonization. Episode 42: The Four Pillars of Wound Care thumbnail Episode 42: The Four Pillars of Wound Care Host Brian Thompson discusses the four pillars of a great wound care program with Amanda Yavorsky of McKesson Medical/Surgical. A lot of providers believe that it's tough to turn a profit in wound care, but Amanda is here to tell you that this isn't necessarily the case if you know where to start. Help us blow up Heather Trumm's email! If you'd like more information about starting your own wound care program, contact [email protected] Worldwide Injury Prevention Day Declared thumbnail Worldwide Injury Prevention Day Declared Thursday, November 21 has been declared Worldwide Pressure Injury Prevention Day by the National Pressure Ulcer Advisory Panel (NPUAP). Healthcare professionals from around the world are raising awareness of the pressure injuries that are caused by medical devices. Q&A: Wound Care Supplies NOT Covered by Medicare thumbnail Q&A: Wound Care Supplies NOT Covered by Medicare Hello, fellow HME wound care members! Being in the wound care space, we have so many rules and regulations ...