Facts & Figures

Since passage of the Medicare Modernization Act in late November 2003, home medical equipment providers have reacted with a series of emotions strong enough to pass any Hollywood actor's screen test: shock, denial, outrage and dismay. But in the months since — while frustration with the government's actions remains — providers have channeled that energy into an entrepreneurial determination to counter and survive the MMA's effects.

Against this tumultuous backdrop, HomeCare's annual collection of industry facts and figures puts home care companies' hottest areas of discussion under the magnifying glass: product and payer mix, claim denials, days sales outstanding, merger-and-acquisition trends and accreditation. We've also asked experts in these areas to give us their insights and explain what the numbers mean. You'll find their comments throughout this section, along with market forecasts in several key sectors from well-known research firms.

As they take a closer look at the latest statistics, these experts say they see the early reflection of providers' evolving strategies — and an industry in change as it prepares to do business in HME's new order.

The coming years in home care will see a shift away from Medicare and Medicaid — and toward managed care and other payers, according to Dr. William Cron of Texas Christian University in Fort Worth, Texas, who has conducted AAHomecare's Financial Performance Survey for the past several years. “From a business standpoint, you're usually better off meeting customer needs and providing exceptional value, and it's hard to do within Medicare and Medicaid, which are inherently standardized.”

Future product mixes, though, are a bit harder to predict, particularly with the tide of baby boomers soon to hit shore, Cron says. What he does see is a “bifurcation of the industry,” with large firms growing larger and small firms becoming more focused, specializing in relatively few products. These small firms “will become more service-oriented and less product-oriented,” he adds. “And in the end, that's what the customer needs.”