America's Expanding Waistline

I like to see things expand and grow. But when people, not businesses, are expanding, I get very concerned. Recently, I read in the news that 61 percent of Americans are overweight. This “little” bit of information came from a government report that said 127 million Americans are overweight.

The only positive news from these findings is that the manufacturers and distributors of bariatrics products — products that control and treat obesity — also are expanding their business. Bariatrics is a “big” market, no pun intended.

And a related task for durable medical equipment and home medical equipment dealers is to become leaders to help our fellow countrymen get back to normal sizes. We have to show people what they can do to reduce some excess weight without affecting their way of life. Set up a scale in a corner of your showroom where people can check their weight discreetly. Of course, alongside the scale, display some other scales customers can purchase and take home.

Medicare and Competitive Bidding

We've all heard that the Centers for Medicare and Medicaid Services is contemplating an increase in reimbursements to physicians, and this causes me some trepidation. Several legislators and other Washington officials say that if CMS gives the physicians an increase, the savings must come from somewhere else within the system.

Will they take money away from the hospitals? I doubt it. The American Hospital Association has a very powerful lobby that can thwart that effort. Will they take money away from the home health agencies? I do not believe they left behind sufficient funds for any further reductions to HHA reimbursements. Where may these bucks come from? I don't know, but I hope they find the money without further reducing the fees that DME and HME dealers earn.

At the same time, Florida's Medicaid program needs cash, and now the state's DME dealers have a competitive bidding situation to deal with. Not only does the state believe that Medicaid services should be awarded by bid, but now Florida is adding insult to injury by demanding a $6,000 “proposal guarantee” for each of the services bid. If this starts a domino reaction prompting other states to implement similar programs, our industry may be facing another major obstacle.

Everyone Loves a Sale

The above competitive bidding situation is why I preach “Build cash sales.” Average senior citizens, who make up the bulk of the recipients of Medicare, love to shop. To see what I mean, just spend a few hours at your local mall. Where do they stop? What catches their eyes? It usually is a four-letter word: “Free” or “Sale.”

These are called magnet words because they get customers' attention. Just make sure you back up these words with a real product that the senior citizen can recognize.

Consider the case of the DME dealer who ran a weekend promotion for bedpans. He put a big sign in his store window that read: “Weekend Special Adult Bed Pan $5.95 ea.”

The dealer sold more than a gross of bedpans at a cost of about $2 each. People came into his store to see the bedpans, which were stacked in the front of his showroom and visible from the doorway. Almost everyone who bought a bedpan picked up other items, so that when the dealer tracked the sales of bedpans, he found that the $5.95 item generated an average of slightly more than $10.00 per transaction. Not too bad, is it?

Get Involved

In our volatile industry, it is very difficult for an HME dealer to stand alone. Now, more than ever, it is important to band together with peers and related associations. State DME organizations — which represent your interests in your state capitol — need your support. They can protect your company and your business.

Our industry also is fortunate to have several excellent buying groups with whom you can affiliate. Don't think of the expenses associated with joining a buying group as a cost, but as an investment to improve and protect your company.

And, as I mentioned in April, support the American Association for Homecare. You no longer have the luxury of standing alone.

Questions for Your HLA

In April, I wrote of the importance of getting to know your congressional health legislative assistants. If you have not made the first contact yet, write to me at shelly.prial@worldnet.att.net for the names and phone numbers of the HLAs in the offices of your legislators.

Once you've made the contact, here are a couple of questions to ask: First, is the 2 percent boost in Medicare funding, as determined by law, sufficient to accommodate rising costs? And, second, has competitive bidding proved to be a benefit for beneficiaries? From what I've heard, only CMS believes competitive bidding has been a success.

Marketing Idea

Most local newspapers publish the births that occur each week. I suggest that you send a card of congratulations — perhaps even a small gift basket with baby powder, lotion, shampoo or other similar items — to the families of these new arrivals. All these new citizens have family and grandparents who would appreciate your thoughtfulness. Goodwill is a commodity that cannot be bought, but can last for a long time.

Sheldon “Shelly” Prial is a partner with HPS Healthcare Management. A licensed pharmacist, he has been involved with the health care industry for more than 50 years. In 1987 he founded the Homecare Providers Co-op, now part of the VGM Group, which is nationally recognized for its efforts on behalf of the home care industry and for its educational and marketing programs.