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On the Editor's Desk

by: Liz Beaulieu - Friday, December 16, 2016

I was on the phone this week with a seasoned consultant who advises medical device companies on strategic plans and M&A. He said he’s gearing up for a very busy 2017.

“Since the election, I’ve been working with a number of companies on strategic plans,” he told me. “I though it might take them half way into next year to make moves—that they wanted to see the ‘proof in the pudding’ of a more business-friendly administration—but people are making moves already. They’re looking to hire people; they’re looking to expand their manufacturing.

“I’ve never seen people so positive,” he continued. “One CEO who I always kid as being negative—I’ve never seen him so positive.”

The consultant had a number of anecdotes: Companies looking to add plants or expand existing plants; a company that moved jobs to Mexico—“It drove the CEO crazy to have to do that,” he said—that plans to move them back.

Private equity firms will also be more active in 2017, the consultant, who’s logged up to 100 deals in his career, told me.

“There’s so much private equity money sitting out there,” he said. “PE firms have always been able to buy cheaper because they’re financial buyers. To get deals done now, they’re realizing they need to up their game, because strategic buyers are willing to pay a good price. PE firms have realized they have to sit on the sidelines or pay better valuations, and you can only sit on the sidelines for so long.”

The consultant credits Trump and his emerging cabinet picks as the largest motivating factor for companies lining up an active 2017.

“You don’t become a billionaire by being a lackey,” he said. “He’s getting some strong people in there. When you see successful people in those positions, it drives other people to be positive about their success.”

by: Liz Beaulieu - Friday, December 2, 2016

It’s not everyday someone who has such close ties to the HME industry gets appointed to a top post like secretary of the Department of Health and Human Services.

I mean, has it happened, ever?

Managing Editor Theresa Flaherty talked to industry stakeholders on what it might mean to have Rep. Tom Price, R-Ga., as HHS secretary. That story will be in Monday’s HME Newswire, but here’s a sneak peak.

I was talking to Seth Johnson of Pride Mobility Products this week about a complex rehab-related provision that has made it into the 21st Century Cures Act and I asked him about Price, too. Johnson said it’ll be great to have Price in the top post for obvious reasons (his disdain for the current competitive bidding program, for example) but also everyday reasons (his disdain for the overall inefficiency and ineffectiveness of Medicare, for example).

“President-elect Donald Trump has said he’s going to ask his cabinet officials to review all the regulations that have recently been put out, so I think that there’s some work that could be done to ease the burden on providers that could also take place next year under Price,” he said.

It was also interesting to see how those not as familiar with Price covered the announcement.

Tom Price: The CliffsNotes version

Trump picks Price, Verma as heads of HHS, CMS: 9 things to know

Providers on twitter were also reacting to the announcement this week. This from Tyler Riddle, a provider in Georgia:

“Odd that twitter is freaking out over the Price appointment, yet everyone I’ve spoken to that works in health care is cheering (thinking man emoji) #hhs.”

Or this from Gary Sheehan, a provider in Massachusetts, who’s already crafting a to-do list for Price’s first days in office:

“Not enough for Dr. Price to revamp flawed bidding program. Must rid agency of architects & enablers of policy, ensure never craft regs again.”

I suggest the HME industry end the week on this high note, shall we?

by: Liz Beaulieu - Wednesday, November 23, 2016

To come up with enough grist for the mill for the HME Newswire in two and a half days on account of the Thanksgiving holiday has been a bit of a challenge, so Managing Editor Theresa, Associate Editor Tracy and I thought we might have to get crafty.

We started putting together a file of stories from this year that we thought spoke to what’s good about the HME industry, it being the eve of Thanksgiving and all. We set out to find two stories apiece.

Here’s what Theresa threw in:

SBA honors Alpine founder

AvaCare Medical recognizes, rewards military

Apria weathers historic flood

Here’s what Tracy threw in:

ATP at Trucare customizes ultimate wheelchair for boy with CP

CRT advocate helps community 'humbly catch up'

When I started reviewing this year’s issues, looking for stories that fit the bill, I found more than I thought I would. Naturally, there are the regular doom-and-gloom Medicare competitive bidding updates (ugh), but I also found a great mix of stories that represent hope—in purpose and in business—in the HME industry.

How about Google and apple both giving a nod to the mobility industry this year?

How about AAHomecare and VGM coordinating their advocacy efforts?

What about Medical Necessities buying a closed YMCA and making it a corporate office, providing built-in health and wellness benefits for the company’s employees and its community?

What about a demo (recently expanded) that allows providers to speak with a reconsideration professional by phone to try and resolve their denials?

I could go on, actually.

On twitter this week, providers were also in the Thanksgiving frame of mind. Monroe Wheelchair posted this pic of CEO Doug Westerdahl handing out pies to employees to thank them for their work.

“It doesn’t get any more warm and fuzzy than handing someone a pie,” he told me.

Yes, Doug, there’s always pie!

We didn’t end up needing a Thanksgiving tribute for the Newswire (news broke about Arriva Medical on Tuesday that helped us fill out the lineup), but it was a good exercise, anyway.

We challenge you to do the same.

by: Liz Beaulieu - Tuesday, November 8, 2016

We’ve spilled a lot of ink this year—online and in print—on the increasingly connected sleep therapy market, and with good reason.

Companies like ResMed and Philips Respironics are leading the way there, with CPAP devices that connect to software programs that allow providers to monitor the therapy of their patients remotely. They also have accompanying programs and apps that allow the patients themselves to play a more active role in their therapies.

This has now laid the groundwork for adding connected capabilities to other respiratory-related products, like portable oxygen concentrators and ventilators.

It should have been obvious, but it didn’t dawn on me until Medtrade that there are advances being made in this area in other markets of the HME industry, as well.

I was visiting Quantum Rehab’s booth at the show and Jay Brislin, the company’s vice president, was telling a group of reporters from industry trade pubs, including me, about the increasingly “smart” and connected capabilities of its complex power wheelchairs.

It’s still early days, but examples of that include a control panel with an LED screen that allows clinicians to program up to 15 different functions, including a warning when a patient has tilted too much; and Bluetooth connectivity, making much of a clinician’s job wireless.

Pretty awesome, right?

Naturally, when talking about technologies like these, the topic of reimbursement comes up, but Brislin is mostly undeterred. He likened the situation to when tilt-and-recline was new and not funded, but after it transitioned from a want to a need, it became funded.

“You need to be customer-centric,” he said. “You have to do what the customer wants.”

Quantum Rehab has taken a similar approach to its iLevel Power Chairs, which allow operation with seat elevation up to 10 inches while at a walking speed of up to 3.5 mph. The company has had some success working with clinicians and private payers to get the chairs funded, working toward what it hopes will be more widespread funding.

The response to Quantum Rehab’s approach to the market, especially from the perspective of increasingly tech-savvy consumers, has been phenomenal, Brislin says. He recounted a story about how he performed several fittings for iLevel Power Chairs recently where the consumers pursued the technology after seeing it on Facebook.

“In my 16-year career, I haven’t seen customers so knowledgeable about the products, and they picked ours,” he said.

by: Liz Beaulieu - Wednesday, October 26, 2016

There are signs in our upcoming State of the Industry Report (keep an eye out for it in December) that the HME industry may be beginning to settle down after a few roller coaster years. 2011 through 2014 were mostly unkind to the industry, thanks to a Medicare competitive bidding program that has delivered round after round of cuts.

But in 2015, when we look at DME growth by product category, we see slight increases across categories, with the exception of hospital beds. For the wheelchair category, for example, Medicare expenditures were $625 million in 2015 vs. $615 million in 2014. For oxygen and supplies, they were $1.5 billion vs. $1.4 billion.

There’s another section in this report that screams, “We’ve settled down”: the list of top providers in 2015. For the first time in as long as I can remember, the list is a carbon copy of the previous year’s list, at least when it comes to the top 10. See below for the list for 2014, followed by the list for 2015.


What’s more, all the providers in the top 10 saw increases in allowed charges from 2014 to 2015, with the exception of Walgreens. The biggest increase in allowed charges went to Zoll Services, at 25.7%. After that, Lincare saw a 16% increase in allowed charges, followed by Lincare Pharmacy Services at 12.4% and Apria Healthcare at 10.7%.

What do these nationals have to thank for their increases in business? Possibly the same competitive bidding program that’s causing so much damage to the rest of the industry. If anyone can make it work, it’s the nationals, which can leverage economies of scale.

When we dive into utilization by product, though, it’s still a roller coaster, as it has been in previous years. We’re seeing high highs, as with non-invasive vents, which saw an 86.95% increase in utilization in 2015 compared to 2014; and low lows, as with TENS devices, which saw a 35.89% decrease over the same time period.

Of course, after all this, it’s possible 2015 represents only a brief reprieve. In 2016, Medicare rolled out bid-related pricing nationwide to non-bid areas and that’s likely to significantly impact the data for next year’s report.

While we’re on the topic of data, I need to let you know, with my tail between my legs, that I’ve updated a blog that I wrote awhile back titled “Calm before the storm.” It turns out that adding percentage changes for two time periods doesn’t equal the total percentage change across those two time periods—sorry, I’m a writer for a reason. Thank you Steve Stickney for being such a stickler and pointing this out, and pointing it out so kindly.

by: Liz Beaulieu - Thursday, October 20, 2016

There are a number of reasons why I want this election cycle to end, some of which will remain nameless.

I’m sure I’m not alone.

After it was clear nothing would get done before the elections, industry stakeholders targeted the lame-duck session starting in mid-November as a small window to get bid relief legislation passed before the end of the year.

We reported some good news in late September, that stakeholders have the word of House Speaker Paul Ryan that he will address bid relief legislation in the lame duck.

(Although I saw at least one comment on twitter to the effect of, “We’ve heard that before,” AAHomecare’s Jay Witter says it’s a level of assurance that stakeholders have never had before.)

But there was bad news this week, with “Inside Sources” reporting that Rep. Frank Upton, R-Mich., is the “chief roadblock” to bid relief legislation passing.

While Upton’s not opposed to bid relief legislation, he doesn’t want anything to interfere with getting the 21st Century Cures Act passed and, unfortunately, without his support as chairman of the House Energy and Commerce Committee, it’s unlikely bid relief legislation will move forward before the end of the year, “Inside Sources” says.

It’s a predicament that, unfortunately, HME stakeholders find themselves in regularly. Every time we put an issue to bed, I look at the previous year’s issue just for kicks. What were the big stories? What issues continue to linger?

At the top of the November 2015 issue: “Key up for small window: Stakeholders race against time with bid expansion slated for Jan. 1.”

This was, of course, before that first round of cuts ended up going into effect in non-bid areas on July 1, followed by a second round on July 1, delivering a 50% total reimbursement cut, on average, to providers in rural America.

The industry has had a few wins in its fight against competitive bidding, but a retroactive delay in this second round of cuts would be a big one. It would not only soften the blow of the reimbursement cuts, but also send a strong message that not all is well with the program.

Additionally, a win here would reward stakeholders and providers for their relentless efforts.

I talked to Melissa Cross, vice president of the homecare division at O.E. Meyer, today. She’s the recipient of the newly named Van Miller Homecare Champion Award. She called competitive bidding the “biggest battle of our lives.”

“What AAHomecare, VGM and others are doing for this industry—they’re the true winners of this award,” she said. “They’re in the trenches day in and day out. We have to step up so their work means something.”

So let the elections be over with already, so we can get to what, hopefully, won’t be a lame-duck session.

by: Liz Beaulieu - Thursday, October 13, 2016

Well, Theresa and Tracy, we had a good run.

Before now, we’ve been basking in the glow of having three recent HME Newspolls with more than 100 respondents.

In the August issue, our readers had plenty to say about whether or not they’ve stopped taking assignment on certain products this year (148 respondents); in the September issue, they had plenty to say about how Medicare pricing has impacted Medicaid and third-party payer pricing in their states (114 respondents); and in the October issue, they had even more to say about who will be their pick for president next month (303 respondents).

Before these polls, it’s been a struggle. Take our July issue, when we asked about the impact of a new overtime rule on providers’ businesses. That poll had 53 respondents. In the June issue, we asked about a new overpayments rule. That poll had 24 respondents.

I concede that polls about Medicare assignment, piggyback pricing and the presidential election are slightly more sexy than polls about new overtime and overpayments rules, but we’re shooting for some diversity over here.

For our November issue, which we’re kicking out the door this week, we thought it would be a good idea to have a special Medtrade-themed poll, with the rationale that we could use the responses to said poll for a story for the Show Dailies that we’ll be doing onsite at the show. Since the goal for Medtrade this year is “Collaborate, Cultivate and Innovate,” we settled on asking providers about how they have collaborated, cultivated or innovated in their businesses this year.

Can you hear that? That’s the sound of a pin dropping.

Twenty-four hours after we sent the poll out—which is when we get the bulk of our responses—we’ve heard from eight providers. Eight!

Dejected, I took to twitter yesterday afternoon to say: “Based on the # of respondents to our poll so far, there’s not much innovation going on in the HME industry.”

I thought I might rile some folks into action—nope.

I did hear back from Tyler Riddle, a provider in Georgia. He tweeted: “@hmeliz folks just hanging on.”

There is that. One of the eight respondents to the poll wrote in: “For the first time, four local businesses sat down together and commiserated about the state of the industry. That’s the closest we’ve gotten to collaboration.”

There’s no doubt that, as a recent guest blogger said, “Medicare is the worst I’ve seen it,” but I prefer to think that the dearth of responses means providers are too busy collaborating, cultivating and innovating to be pestered by me, Theresa and Tracy and our little poll.

by: Liz Beaulieu - Friday, September 30, 2016

I’m not going to lie. When I asked Rick Glass, who always presents the results of our Financial Benchmarking Survey at the HME News Business Summit, to put together a 10-year snapshot to recognize 10 years of the survey, I was a little worried about what’d I’d get back.

As any of you know, a lot has happened to the HME industry in 10 years—a lot of it not good.

And as any of you know, Rick is not one to sugarcoat reality. If it’s bad, he’s going to tell you it’s bad.

So I was pleasantly surprised when Rick came back to me with this slide.

Granted, these numbers represent a small slice of the HME industry. And I tend to think that the providers who complete the survey tend to be the providers who have healthier businesses.

But look.

The number of providers who report Medicare as a large part of their business is decreasing—from 44% in 2007 to 25% in 2016. This, to me, means you really are changing your business model, whether it’s more non-Medicare business or more cash sales.

The number of providers who report revenues grew year over year has remained relatively stable—65% in 2007 and 62% in 2016. This, to me, means cost cutting and strategic efficiencies are allowing you to do more with less.

The number of providers who reported profit dollars grew year over year actually increased—from 61% in 2007 to 66% in 2016. Blow me over with a feather.

This is as good a way as any to end the week. Happy Friday!

by: Liz Beaulieu - Friday, September 23, 2016

We'll have two stories in our HME Newswire on Monday about different sessions at this week's HME News Business Summit.

(Don't tell anyone, but here are the links to those stories now: and

But there was so much good stuff from the Summit (stuff—real technical term, I know), I've also strung together some quotables from other sessions here.

Available green space
Interoperability has its roots in paving the way for acute-care providers to “talk” more easily with ambulatory care providers, but leaders have realized that’s not good enough, said Jeff Gartland, who sits on the operating committee of the CommonWell Health Alliance, a not-for-profit trade association of health IT companies working to create universal access to health data nationwide.

“One of the profound findings that we’ve found since we’ve deployed (the network to thousands of sites) is that the diversity of the ecosystem that is important goes beyond ambulatory,” said Gartland, who participated in a panel titled “Interoperability: Why it’s not pie in the sky.” “It’s really critical, if we’re to follow the patient where they are, that there is a diversity of care settings (involved).”

That opens the door for HME providers to become a bigger part of the process, said Nick Knowlton, an operating committee member and chairman of the membership committee at the Alliance. That process is far enough long to have momentum but not too far along to represent a missed opportunity.

“What the healthcare ecosystem needs is your leadership,” he said. “There’s a lot that still can be invented out there—there’s still a lot of green space.”

Irresistible demographics

M&A analysts believe private equity activity could perk up now that it’s possible that CMS has wreaked all the havoc it’s going to wreak with its competitive bidding program. This year, the agency applied bid pricing to non-bid areas.

“Once reimbursement is stabilized and it’s no longer a variable risk, the demographics are irresistible,” said Don Davis, president of Duckridge Advisors, who participated on a panel titled “M&A in a challenging market: What and where are the opportunities?”

Influencer of outcomes

When HME provider Dewey Roof thinks about what he prioritizes in his business, he thinks about what hospitals and health systems prioritize in theirs. That’s gone a long way toward making them see his company as “an influencer of outcomes” vs. a “widget provider.”

“All your data needs to be aligned to that goal and demonstrate that value to your referral source,” said Roof, president/CEO of LifeH2H, who participated on a panel titled “Connected health: Let’s get in the weeds.” “Whatever is important to them has to be important to you.”

by: Liz Beaulieu - Wednesday, September 7, 2016

I wrote a blog earlier this year about how competitive bidding has affected access to home medical equipment.

I used our HME Databank to look at two data points for walkers (E0143), a common product that has been included in the program:

  1. the number of Medicare beneficiaries who received the product in a given year
  2. the amount Medicare spent on that product in a given year

You’ll recall that I found a 9% decrease in the number of Medicare beneficiaries who received walkers from 2012 to 2013 and a 9.7% decrease from 2013 to 2014. From 2012 to 2014, pre- and post-Round 2 of competitive bidding, which saw reduced reimbursement spread to cities across the country, I found a 17.9% decrease.

I also found an 18% decrease in the amount Medicare spent on walkers from 2012 to 2013 and a 23% decrease from 2013 to 2014. From 2012 to 2014, it was a 37.4% decrease.

At the time, I was anxious to add 2015 data to the mix. Round 2 went into effect July 1, 2013, so 2015 data would give us a picture that spans more than two years.

Now I have 2015 data.

We’ll be updating our HME Databank with 2015 data on Oct. 1, but below is a sneak peek at what the two data points above look like for walkers:

2014: 705,831 Medicare bennies received the product

2015: 706,354 Medicare bennies received the product

2014: $38,313,467 in total reimbursement

2015: $38,673,505 in total reimbursement

So it turns out the number of Medicare beneficiaries who received walkers and the amount Medicare spent on these products remained relatively stable from 2014 to 2015.

We all know, though, that 2016 has been a watershed year for the HME industry. On Jan. 1 and July 1, CMS rolled out bid-related pricing to non-bid areas nationwide. And on July 1, it also implemented further reductions in Round 2 areas as part of a re-compete of the program.

What do you think the data for 2016 will hold?

Stay tuned.