As everyone looks inward during the country's economic downturn, the question is, how much has the recession impacted the HME industry? Although you hear that health care is recession-proof, as the economy continues to worsen, there must be some effect on HME providers. It could also be argued that the HME industry knows how to work in a cost-cutting environment, as Medicare constantly works to reduce payments and tighten regulations. Regardless, there's still no better time to look more closely at operations and seize opportunity than while the focus is on an ailing economy.
Get Rid of Excess/Waste
A recent Deloitte study of 150 technology industry executives found that “companies are shifting their focus towards internal improvements, with 59 percent of company-wide initiatives being internally focused.” This means that we should all work to eliminate excess and duplication. Look for how many people are required to perform a function.
Further, ask your staff why they perform each function. You will undoubtedly hear from some that the reason they perform a certain task is because they were taught to do so by their predecessor. Once you determine why the function is actually performed, you will know whether it is truly necessary or if there might be a more efficient way to complete it.
In addition, aim to rid yourself of all manual functions, especially if you are still using hard copy patient files. Even America's economic stimulus package will include substantial funds to digitize medical records for hospitals and doctors.
Further, look to track and monitor productivity via data. Know your top three denial reasons, for example, and how much money is outstanding as a result of these denials. Track progress based on these figures and how quickly the denials are resolved.
Finally, use data to increase revenue by looking at various products that might complement reimbursable products already used by your existing patients and their specific disease states. What more could COPD patients use besides your oxygen? Where else are they getting their health care needs met? Make it your business/prerogative to provide all products related to their disease state.
Make Room for Survivors
Despite every company's best intentions, some will exit the market by closing their doors. Some small companies providing HME services as a courtesy to their other core customers (from their primary business such as pharmacy) may decide it is not worth the effort to become accredited and secure a surety bond in order to maintain a Medicare provider number.
Additionally, some companies will not want to alter the way they do business to continue serving their customers. Perhaps they've done business a certain way for many years and they don't want to change now. These companies will eventually lose market share.
What remains is more business for hungry companies that are dedicated; these are the survivors. Businesses that embrace change, infuse it with new ideas and constantly look for ways to improve operations will surely be prepared for what's to come. To them, change is an opportunity, not a threat.
Companies bracing for change look at GPS for deliveries, bar coding for inventory tracking, electronic order placement, eCMNs and efaxing as well as other automation initiatives. Not all of these projects will be implemented at the same time, but each company will have different objectives in achieving operational improvement.
One thing is certain: As companies exit the market, surviving companies should be ready to seize opportunity for the remaining market share. After all, home care is a burgeoning field, and someone will have to provide the required service. Working hard to foster existing relationships and building a secure infrastructure to absorb the new business will help ensure future success.
Look at Innovation
One of the questions often asked is what makes people successful during a recession? According to David Silverman of Harvard Business Review, “While there's no question that a bad economy makes it tougher to raise capital and win customers, the reality is that good ideas implemented well always have room to succeed.”
Now is the time to think outside the box and come up with new and creative ways to generate business. Make sure to include staff in brainstorming sessions. It is often the idea of a staff member that generates your next big initiative. If properly done, innovation begins with a needs assessment that defines the desires and problems facing your prospective referral source and/or customer. Redefining functions and moving away from business as usual helps identify creative solutions.
Value Human Resources
One of the best and most expensive assets for a company is its work force. Without people, it is hard to keep a company afloat. Nonetheless, during challenging economic periods as expenses are trimmed, invariably employees are laid off. In this particular economic hardship, layoffs have included not just younger, more inexperienced staff but seasoned and veteran staff as well. Seeing people let go after 30 years of service would have been unheard of 10 years ago.
While this seems depressing, for HME providers who are experiencing a growth spurt, this is great news. In fact, it may be one of the best things to happen to a growing company. As other industries are hurting and eliminating positions, you could be seizing opportunity by employing talented people who are simply willing to learn a new craft just to have a job. They are often willing to take whatever pay you are willing to offer.
By tapping into fresh, out-of-the-box thinkers as employees, you might just find the next superstar to help with the innovation you need. We always say that people are what set you apart from your competitors. Now is the time to capitalize on this opportunity. Even if someone is over-qualified, if he or she is hungry and ready to take on different and creative responsibilities, it is worth pursuing.
In this shaky economy, focus inward for operational improvements by searching for waste and excess. Assume a survivor mentality to ensure your longevity, and be prepared when your competition leaves you with their portion of the market pie. Use innovation to create your future success, and together with the talented pool of skilled people looking for work, you should be able to seize new opportunity and forge ahead with increased profitability and stability.
Miriam Lieber is president of Lieber Consulting, Sherman Oaks, Calif., specializing in operations management and reimbursement for the HME industry. You can reach her at 818/789-0670 or by email at miriam@lieberconsulting.com.
