Oxygen users are not taking their disease sitting down any longer. As early diagnosis of chronic obstructive pulmonary disease increases, the trend continues to produce a new breed of oxygen consumers who have lifestyle-driven outlooks and are cognizant of their choices.
“The demographics of oxygen users changed with the demographics of lung disease. COPD does not discriminate, though there are obviously risk factors and age factors involved,” says Carla Laureano, marketing manager, Chad Therapeutics. “But with the improvement in medical care worldwide, as well as increased awareness of treatment options, oxygen users as a whole are becoming younger and more active.”
Their mindset also has changed, adds Rajib Rouchoudhury, director of marketing for Puritan Bennett. “There has been a major psychographic change in patients. They have become more aware of product choices, have taken more responsibility for their own care and are less willing to accept lifestyle degradation,” he explains.
“This trend will accelerate as demographics change due to the aging of baby boomers.”
The shift is noticeably different than what was seen 20 years ago according to Bob Fary, Inogen's vice president of sales. “Back then, [patients] didn't wind up on oxygen until they were really sick and typically were in the last stage of the disease. Today, people get treatment earlier on in the disease process, and they live longer because the treatment is so worthwhile and successful so they can lead more productive, longer lives with a better quality of life.
“Now, there are oxygen-dependent chronic lung patients who go to work every day and travel extensively,” adds Fary. “Certainly, that has an impact upon how [providers] will get opportunities in the marketplace.”
Patient-Centric Innovation
The impetus for innovation in the home oxygen market is multi-faceted. Patients want small, attractive units that are portable; clinicians struggle to maintain patient care and safety; and home medical equipment providers search for cost-effective solutions that will accommodate customer needs.
“Innovation in this market should be defined as unique technology that delivers better clinical outcomes, first and foremost, and also better economic outcomes,” says Rouchoudhury. “Clinical innovations are driven by features that allow patients to be ambulatory while maintaining saturation. Economic innovations are driven by features that reduce deliveries, cost of the equipment and cost to service the equipment.”
Chad's Laureano believes portability is arguably the most important factor in oxygen delivery. “We hear constantly that patients want the portable units they see on television, regardless of whether they actually meet their oxygen needs, so the challenge is to provide a highly ambulatory unit while still being clinically effective,” she says.
“Most importantly, oxygen systems must meet the patient's clinical needs by keeping an adequate oxygen saturation, but they must be portable, attractive and easy to use,” Laureano continues. “In the past, oxygen patients would stay at home because they were embarrassed to be seen with their bulky oxygen systems. Additionally, the systems must provide an adequate supply of oxygen so that users can go about their daily business without worrying about running out of oxygen or rationing it for emergency trips.”
Fary explains that although steps have been taken to make the devices smaller and lighter, the clinical balance of smaller and lighter versus an appropriate therapy for all patients is a challenge.
The need for portable oxygen therapy options has not been overlooked by manufacturers. Dr. Robert Hoover, Jr., senior vice president of global clinical services for Sunrise Medical and former medical director of the Region D DMERC, says patients drive product development through their desire for lighter weight systems, which has resulted in improvements in battery life, size and oxygen extraction efficiency — all of which have impacted portability.
“All patients benefit from being active and mobile, both physically and psychologically. The freedom to interact with their friends on their own schedule, to travel with their oxygen and engage in the full gamut of life's activities is critical,” says Hoover. “Smaller systems afford patients these opportunities and are much less obtrusive — and, thus, stigmatizing — than dragging around the old E-cylinder.”
Beyond user needs and wants, Hoover says reimbursement and the cost of providing home oxygen also drive product innovation in this market. “As oxygen reimbursement has declined, providers are seeking ways to reduce the cost of delivery of this therapy. Innovations such as home transfill systems and oxygen conservers reduce the need for the medical equipment supplier to make costly trips to the patient's home,” he says.
“Moreover, these systems empower the patient to provide some of their own care, on their own schedule, without having the inconvenience of waiting on the delivery of their oxygen.”
Scott Wilkinson, Invacare Corp.'s group product manager for oxygen therapy, stresses that reimbursement changes are forcing providers to consider new ways of operating. “We've been preaching non-delivery for the last three or four years as a way of the future, but I think reimbursement cuts bring that home,” he says. “Providers take it more seriously when their income is cut and they are forced to change as opposed to just entertaining thoughts about it.”
But the move to new technology can be slow. Fary says many providers have so much invested financially in older technologies that they are not prepared to make additional investments. “By the same token,” he points out, “there are other providers who recognize that, given the reimbursement situation, they do need to seriously change their business model if they're going to be successful.”
Considering such solutions is a must, notes Hoover, if providers want to continue providing the best care to their customers. “Most manufacturers of oxygen products have educational programs directed at patients with oxygen needs. HME providers need to do their homework on the systems available on the market and provide a variety of choices for their patients,” he says.
“HME providers should also serve as a resource to their physician referral base and give them any clinical education needed so that they're aware of the options available in oxygen therapy.”
Quality training for employees and patients is also a must, Rouchoudhury adds.
What Is ‘Portable?’
Oxygen users themselves, in fact, are beginning to play a larger role in the selection process of the equipment they use. They are getting information from the Internet, support groups and through direct-to-consumer advertising.
Wilkinson says baby boomers are savvier, more knowledgeable and more demanding customers than their predecessors. “They will switch providers if they don't get what they want, and they are pretty well-informed as to what is available, whereas the previous group was not well-informed and kind of took what they got.”
The fact that patients are so knowledgeable about new products and technologies places a heightened responsibility on providers, says Laureano.
“It is important that the provider is well-versed on new technology, whether by reading trade publications or attending trade shows, before their patients request the product,” she advises. “They will then be in the position to help determine whether a particular technology is beneficial to the patient and less likely to lose that patient to a competing provider who offers the product.”
The push by users for portability is clear, but its definition is not.
Hoover says attendees of the Sixth Oxygen Consensus Conference on long-term oxygen therapy (an invitation-only meeting in August where experts tackled a host of LTOT issues) were not able to agree on a standard definition of “portability” for oxygen products.
“For example, some patients feel a 5-pound system is ‘portable’ for them whereas others find a 13-pound system on wheels is ‘portable’ for their needs,” he says. “[‘Portability’] is very patient-specific and must be determined by the patient's clinical and lifestyle needs.”
There are a variety of products on the market that address these needs, but users need to be aware of their benefits and limitations.
“All portable systems currently on the market have drawbacks due to the dilemma of size versus battery life. Smaller compressors and oxygen recovery units require less power and thus smaller batteries; however, the trade-off is how much oxygen they're able to continuously produce,” Hoover explains.
“With current technology,” Hoover continues, “most highly portable units have sub-1 liter continuous flow rates and utilize conserver technology to reach an equivalent 2 liter flow. Conserver technology, while revolutionizing the delivery of oxygen, has a lot of unanswered clinical questions such as the delivery of oxygen during sleep and the proper ‘dose’ of oxygen to deliver.
“As you try to increase the continuous flow to 3 liters, the size of the components necessary to accomplish this get larger and require more power; therefore, the batteries get larger, and portability can suffer.”
Invacare's Wilkinson adds that users who prefer portable systems also like the freedom associated with home filling systems. “From a freedom and independence standpoint, those products, I think, serve patients better,” he says. “They don't have to depend on someone else or have to worry about running out of oxygen.”
He stresses that providers should focus on their patient's desires in addition to their needs. “It really depends on what is right for them, and I think we will begin to see providers doing a better job of this in the future,” he says.
As patients push for portability, HME providers must continue providing services that benefit patient care and referral source demands. Fary suggests that home oxygen systems that decrease delivery requirements offer an opportunity for providers to enhance their clinical programs.
“At the end of the day, that is what is going to benefit the patients the most — and what is going to make the referral sources and the insurance companies happy — because there will be fewer hospital admissions and fewer emergency department visits,” he concludes.
Experts Interviewed
Bob Fary, vice president of sales, Inogen, Goleta, Calif.; Robert D. Hoover, Jr., MD, MPH, senior vice president, global clinical services, Sunrise Medical, Longmont, Colo.; Carla Laureano, marketing manager, Chad Therapeutics, Chatsworth, Calif.; Joe Priest, president and COO, AirSep Corp., Buffalo, N.Y.; Rajib Rouchoudhury, director of marketing, Puritan Bennett, Pleasanton, Calif.; Scott Wilkinson, group product manager for oxygen therapy, Invacare Corp., Elyria, Ohio.
POCs Take Flight
When the Federal Aviation Administration ruled this year that portable oxygen concentrators could be used on commercial flights, the home oxygen community cheered. According to Joe Priest, AirSep Corp.'s president and COO, it was a universal win.
“This is one of those notable times where I think virtually everyone stands to benefit,” he says. “First and foremost the patients benefit, the providers benefit and the airlines benefit. It is one of those technologies that meets a need that has always been extremely problematic for everyone involved.”
AirSep is one of two companies whose POCs have thus far been approved. Its LifeStyle concentrator and Inogen's Inogen One are allowed on board by the FAA, although under the rule, airlines are not required to do so.
Prior to the ruling, airline travel for oxygen patients was expensive and difficult to arrange. Flight layovers required careful coordination with the patient's HME provider to ensure uninterrupted availability of oxygen. For patients, there remained the constant worry about delays, inclement weather or aircraft trouble, which could increase their margin for error.
As well, points out Inogen's Bob Fary, vice president of sales, the process was a logistical challenge for providers, who must accompany, meet or wait with oxygen patients at the airport.
Soon after the ruling, America West, Northwest Airlines and U.S. Airways began allowing POCs on board. Others have recently followed suit, including Midwest Airlines and Delta Airlines, which began allowing patients to use the Inogen One this month. The next step, Fary said, is to get other major carriers on board, and he is hopeful this will happen in the next six months. Then, he says, the push will be to work with smaller, low-fare carriers, which will benefit oxygen users by giving them additional air travel options.
Priest notes that the change in FAA rules can create a new revenue source for providers. People are willing to pay for this on their own, he says. “They still want their normal concentrator and their portable cylinder, but they want this for their traveling needs,” he says. “They will gladly purchase or rent it privately.” He estimates that 80 to 90 percent of the units rented or sold to date have private pay.
Meanwhile, a rule proposed in September by the Department of Transportation would require U.S. and foreign airlines to provide supplemental oxygen free of charge to patients in need. Currently, airlines are not required to provide oxygen, and those that do usually charge a fee that can be prohibitively expensive.
Just the Facts
According to the American Association for Homecare:
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More than 14 million Americans have been diagnosed with chronic obstructive pulmonary disease (COPD), which is the fourth leading cause of death in the U.S. and killed more than 120,000 in 2002.
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In 2002, there were 673,000 people hospitalized for COPD. Their average length of stay was 5.2 days. In 2001, there were 13.8 million COPD-related physician office visits.
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Oxygen can be provided to a COPD patient who lives at home for one year at less than the average Medicare cost for one day in the hospital. The average Medicare cost for a day in the hospital is $3,606.
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Total expenditures for COPD in 2004 were $37.2 billion, an increase of more than $5 billion since 2002.
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Of the 2004 expenditures, $20.9 billion went to health expenditures: hospital care, $8.6 billion; physician and clinical services, $3.8 billion; prescription drugs, $5.0 billion; home health care, $0.7 billion; nursing home care, $2.8 billion. This figure is up from $18 billion in 2002.
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$7.4 billion in spending went to indirect morbidity costs, and $8.9 billion to indirect mortality costs (compared to $14.1 billion in 2002).
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In 2003, there were about 11.7 million diagnosed cases of emphysema (3.1 million) and chronic bronchitis (8.6 million), the two conditions that comprise COPD.
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Oxygen for home use by COPD patients costs about $1.8 billion a year — less than 1 percent of total Medicare expenditures.
