The burden of higher costs coupled with fewer reimbursements, tougher audits and more regulation falling on businesses that are responsible for servicing patients in need of oxygen means this industry is undergoing significant changes. Companies that have been awarded oxygen competitive bidding contracts need to develop new cost- cutting solutions, while not compromising patient care and—most importantly —maintaining a profitable business.
How can providers do this in an already challenging and competitive marketplace? There are many options—most of which seem to come with a significant downside. Routine visits to oxygen patients’ homes by technicians or respiratory therapists are an example of a service many providers simply can no longer afford. Cutting these visits or adding extra charges for them is not ideal, but for many it is the first and most realistic option.
Many providers are incorporating technology, and while this can lead to decreased costs and added efficiency in the long run, it comes with significant up-front costs and complicated implementation processes, making it a difficult solution.
Searching for new lower-cost suppliers is also an option, although changing a patient’s supplies can lead to increased complaints and even a loss of sales.
What changes can providers make immediately, without large up-front costs, to slightly modify their business structure? Many providers have shifted more focus toward supplemental oxygen product sales—specifically, cash items in which Medicare and Medicaid are not involved.
Products that fall into this category are free from the hassle of insurance billing and can increase profitability per patient. These products also genuinely help patients by improving their comfort and safety, plus product availability from numerous manufacturers and distributors makes them easy purchase items for most home care companies. Some popular cash sale items include:
- Comfort cannula pads—These foam pads wrap around the area of the cannula that lies behind patients’ ears, helping to prevent chafing and red marks where the cannula makes contact with skin.
- Cleaning wipes and sprays—These can include items such as germicidal spray or wipes patients can use to ensure that their equipment is not only sanitary and safe, but also maintained appropriately.
- Lotions and ointments—Products such as RoEzIt are made specifically to relieve chafing of the nose, cheeks and ears of oxygen patients. Patients should apply it prior to oxygen therapy and at intervals as needed during treatment for moisturization.
- OxySafe cannula valve—This new type of oxygen tubing connector automatically stops the flow of oxygen in the event that the tubing is ignited. Home care companies can install one fuse close to the patient and one next to the delivery device to prevent damage on both ends. It provides a significant level of protection to avoid fire damage in oxygen patients’ homes.
Because many of these items are fairly inexpensive, sending out samples or fliers about routinely distributed items—such as cannulas or supply tubing—is a great way to raise awareness of what is available without a significant financial investment.
Bundling these items into kits that can be marketed in appealing ways, such as “oxygen safety resupply kits” or “comfort kits,” can boost sales and increase margins on the products, too. Bundling cash items is a sales tactic often employed in the CPAP market. Providers should ask their oxygen manufacturers what they may be able to create in terms of kits or marketing materials that could help promote products and increase sales.
The primary challenge in this market is to find ways to keep patient care high while maintaining a healthy business. Cash sales on oxygen items is a quick and easy place to start this process.
