The Medicare Modernization Act is affecting how every DME/HME provider does business. One owner I spoke with recently told me that 75 percent of his volume comes from third-party programs. Needless to say, he is wary about the consequences.
My recommendation was that he should protect that third-party business as best he can but that he should also place as much effort as possible in building OTC (over-the-counter) cash sales. Every provider should do the same. Learn the demographics of your community, and build from them.
The following are more good business-building ideas from HomeCare readers who have shared their thoughts with me.
A dealer in Virginia told me that several years ago he sponsored a Saturday morning blood pressure testing day in his showroom. He worked with a preferred vendor who was introducing a new automatic sphygmomanometer. They invited a nurse, dressed in her white uniform and cap, to do the tests. They only saw about 20 people that morning and sold seven or eight units, but the provider was happy with this first effort.
He scheduled a repeat performance a month later and doubled the results. The company now holds a blood pressure testing day on the first Saturday of each month, and the response has continued growing beautifully. The important thing this provider related is that many of the people who came in just for a free blood pressure test — mostly senior citizens — now come to him for their supplies.
As a pharmacist, I have often spoken about the role of pharmacy in home care. One Missouri entrepreneur did just what I have always preached, and looked at putting together the benefits of both. He sent me the following memo that I would like to share:
“In order to expand and maximize our rural pharmacy's sales, we invested heavily in a DME department. When we had an opportunity to expand 40 minutes north, we invested in a second DME without a pharmacy.
“That worked well, so we opened another stand-alone DME location about one hour east. Our concept is to develop DME stores like spokes in a wheel, with the pharmacy in the center providing Rx and OTC meds to patients in outlying rural areas at a minimum investment.”
I apologize because I left out some of the words, but the message is clear. And, this idea works both ways. Dealers who don't have a pharmacy associated with their operation can certainly enter into a symbiotic relationship with local retail pharmacies.
Good Help When You Need It
There is a major source of competent help available in your backyard. Speak to the advisers at the local community college and inform them that you have an entry-level position for a student who would like to get into health care. Describe the job in detail, with both the starting salary and potential for growth.
You will probably get the names of several young folks that you could interview to see if there is a fit. Over the years, I have watched many of these entry-level new hires blossom into superb salespeople and managers, and develop into major assets for their companies. Several people I know who began as “apprentices” today own and operate their own companies very successfully, often in conjunction with the home care company they started with.
You can find good help when you know where to look.
A Positive Note
The great thing about our industry is the fact that so many of you are true entrepreneurs. Opportunities to enter different markets, seek OTC sales and service other entities are out there waiting for you.
Finding them is not really that difficult. One source for good information is the local chamber of commerce. Join, attend meetings and listen to the other companies that belong. They will tell you what they seek.
Sheldon “Shelly” Prial is based in Melbourne, Fla., with Prial Consulting and also serves as the director of government relations for Atlanta-based Graham-Field Health Products. In 1987, he founded the Homecare Providers Co-Op, now part of The VGM Group. He can be reached by e-mail at shelly.prial@worldnet.att.net or by phone at 321/255-3885.
