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40 Respiratory Management | October 2015

2016 Respiratory Market Outlook

Like most of the DME industry, respiratory providers continue to negotiate the ongoing struggles of an industry in flux. Some have adapted to extensive change, become operationally lean and found a way to keep moving forward. Many providers have not been as fortunate.

According to our experts, the industry will continue to test

provider resolve, as growth will remain a marathon and winning most likely determined by the number of little victories you can accumulate along the way.

“Home respiratory continues to be challenged with the impact of NCB, the myriad audits, continued operational cost challenges, and new rules of engagement as health systems see improved

Respiratory providers continue to traverse many challenges. But the aging population promises growth while new rules, audits, cuts and competitive bidding push providers to operate efficiently. By Joseph Duffy

1015hme_RespOutlook4045.indd 40 9/22/15 4:02 PM

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42 Respiratory Management | October 2015

outcomes and reduced readmissions,” says Joe Lewarski, vice president of global respiratory & sleep for Drive-DeVilbiss Healthcare. “This is compounded by the pending expansion of the NCB rates into the smaller, non-NCB markets, which is essen-tially a new fee DME schedule for the core items. Other key policy issues facing providers include bundling payments for sleep therapy and changing the coding and coverage rules for mechan-ical ventilation.”

But despite the competitive bid rates for oxygen and the compli-ance requirements for CPAP, the respiratory industry is still a growing business for many providers, says Bob Hoffman, vice president of VGM Group Inc.’s Nationwide Respiratory.

“Providers have had to adapt their business practices to capture efficiencies in staffing and operations,” he says. “It has been a

Respiratory Success in 2016Joe Lewarski, vice president of global respiratory & sleep for Drive-DeVilbiss Healthcare offers some strategic suggestions that every respiratory provider should consider to build their businesses in 2016:Know your market metrics. In nearly every market, there are a finite number of respiratory patients in need of homecare services each day. Knowing that number by product category provides you insights into your market share position and what opportunity exists without expanding your geographic market. How many O2 patients are prescribed each day? CPAP, aerosol, ventilator, etc.? Different strat-egies and tactics are needed to move more market share in your direction versus expanding into new markets, making acquisitions, etc.Know your cost to serve. Our industry has been plagued with home grown and local market behaviors and activities that often add cost but not value. What is your cost to provide home O2, PAP therapy, etc. What are the operational activities that bloat your systems, create complexity and ultimately add cost without adding true value? Eliminate waste in your workflow — getting lean is essential. In oxygen therapy, for example, the elimination of all of the non-value-added activities asso-ciated with portable delivery by using non-delivery oxygen technology in place of people. This lets you shift resources to value-added activities.Develop strategic relationships. As noted earlier, in this complex and

competitive market, it is essential to develop long-term, mutually beneficial relation-ships. Outside of healthcare, this is standard operating procedure, as the best-in-class organizations have open and strategic relationships with all levels of their supply chains. Companies, such as Toyota, GE and Danaher, have long developed open relationships with their business partners to drive quality, efficiency and cost benefits. Modeling these methods can help develop the infrastructure and processes needed in this highly regulated, competitive and shrinking margin industry.Market yourself. There is a direct-to-consumer, cash-paying customer base out there if you can reach them. Whether traditional retail or ecommerce, there is a growing population of people who are purchasing respiratory and home medical equipment and supplies. The buyer is not always the patient, so marketing and advertising has to be appropriate and effective.

Dave Marquard, owner and CEO of OxyGo LLC and Applied Home Healthcare Equipment LLC, adds these quick tips:• Establish non-delivery systems for oxygen.• Increase your service area with a non-delivery model.• Set group appointments for patients• Develop less dependence on Medicare.• Increase cash sales through websites and retail selling.

difficult transition for some but opportunity still exists as the Medicare population increases and pressures to reduce hospital admissions grows.”

George Coppola, director of marketing for oxygen equip-ment maker Caire, says home medical equipment is currently progressing through a typical market life cycle, similar to what has transpired in other industries. In short, the industry is tran-sitioning from a high-growth market to a low-growth market. And to successfully transition to a low-growth market, Coppola suggested that providers:• Increase revenues by generating more oxygen referrals from

referral sources. • Improve patient outcomes and reduce re-admittances for ACOs

and hospitals.• Partner with financially stable and reliable manufacturers that

will survive for the long term. For many providers trying to survive by becoming more efficient, Dave Marquard, owner and CEO of OxyGo LLC and Applied Home Healthcare Equipment LLC, says more providers are adopting a non-delivery model for their oxygen business to reduce costs and increase their patient service area.

“For example,” he says, “Instead of serving patients in a 20-mile radius of their business, providers can serve patients hundreds of miles away using portable oxygen concentrators along with a stationary unit. With competitive bidding, providers can bid addi-tional MSAs.”

What Will Be Trending?Looking onward and into 2016, Lewarski says that one trend to watch is the continued and growing focus on reducing and preventing readmission and improving post-hospitalization

“The irony of the current market is that more now than ever, homecare clinicians are needed to assess, educate and manage patients in the home, yet the reimbursement for home respiratory therapy technologies and service is the lowest in history.”

— Joe Lewarski, Drive-DeVilbiss Healthcare

2016 Respiratory Market Outlook

Moving on, Moving up

1015hme_RespOutlook4045.indd 42 9/22/15 4:02 PM

43October 2015 | Respiratory Management

outcomes of patients with COPD and CHF.“As health systems, payors and ACOs continue to expand

and take on more financial risk, and CMS continues to expand other demonstration projects, such as the post-acute care 90-day bundle, the management of high-risk patients in the home becomes even more relevant and essential,” he says. “Solutions will come in the form of both technology and clinical interventions.

“The irony of the current market is that more now than ever, homecare clinicians are needed to assess, educate and manage patients in the home, yet the reimbursement for home respira-tory therapy technologies and service is the lowest in history,” Lewarski adds. “Providers need to become integrated partners with payors, health systems, and ideally, those entities challenged with carrying the risk. This means getting more upstream in the transitional care process, which for many years has been more transactional for HME. Calculated, meaningful interventions with data tracking and analysis supporting clinical and economic outcomes are essential in such relationships. Healthcare data and analytics are new buzzwords in homecare.”

Lewarski also says to pay attention to the changing consumer market.

“Although we have referred to retail as a savior for the third-party system, in today’s market this is much more complex than simply a good location and point-of-sale displays,” he explains. “As health insurance plans shift more cost to the patient, co-pays and deductibles are sending patients looking for better solutions and values, as they now have more skin in the game. Ecommerce and direct-to-consumer sales are growing in healthcare with

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“Instead of serving patients in a 20 mile radius of their business, providers can serve patients hundreds of miles away using portable oxygen concentrators along with a stationary unit.”

— Dave Marquard, OxyGo LLC & Applied Home Healthcare Equipment LLC

2016 Respiratory Market Outlook

See us at Medtrade 2015 Booth # 637

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44 Respiratory Management | October 2015

millions of dollars already transacting. Understanding this space and the rules of engagement is essential. This is a complex and highly competitive environment that requires significant invest-ment, and different skill sets compared to traditional HME.”

Finally, Lewarski says strategic relationships will be increas-ingly more important in 2016.

“This applies to both directions in an organization’s value stream,” he says. “Providers need to pick partners and drive strategic, long-term relationships that deliver value to all of the stakeholders, including healthcare providers, payors and their manufacturer/supplier partners.”

Hoffman says 2016 will see a hospital emphasis on readmissions. 

“Providers who have built strong relationships with discharge planners are able to differentiate themselves from their competi-tion,” he says. “Working together to ensure that patients are well educated as to their medications and that they have a dependable support team at home is vital to keeping the patients at home.”

Hoffman also says that seniors do have cash and families are more willing now than ever before to spend money on medical accessories. The POC market, travel CPAPs and any items that make their in-home care easier and more convenient present opportunities to create cash flow, he says.

The 2016 trends Coppola sees include improving the overall management of COPD patients through the use and application of telemedicine/monitoring and selecting the best oxygen delivery

technology to match patient needs at rest and during exercise.He suggested partnering with pulmonary rehab centers and

physicians to create effective programs that reduce re-admissions of COPD patients and improve the quality of life. Also, identify patients earlier in their disease process who could benefit from using oxygen nocturnally, which would reduce hypoxic events during sleep.

Re-compete of Round TwoAccording to Ronda Buhrmester, Reimbursement Specialist, VGM Group, with the change in the product categories going from oxygen supplies and equipment being a separate category from the CPAP and RAD devices to now all being under one product category changes the game for suppliers. The contracted supplier under Round 2 that didn’t win the oxygen or didn’t win the CPAP/RAD category changed their daily processes, accreditation infor-mation, and licensure/certificates. Now if they want to do a bid for Round 2 re-compete, they have to consider if they want to bid for the respiratory category. If so, they have to update the accred-itation policies, internal processes, and update or change certifi-cates or licensures. All this costs money to the supplier, who will already be getting a lower reimbursement with the SPA.

Lewarski says if history is an indicator, respiratory providers will likely see additional reductions in the rates.

“The same challenges and concerns exist in the re-compete,” he says. “Do providers submit a bid reflective of their true cost to serve or do they bid down to just gain the additional busi-ness? Also, many bidders are experiencing a substantial pinch in their profits due to the low Medicare reimbursements, and previous bid winners may not qualify now based on their most recent tax submissions. For manufacturers the challenge is simple, take cost out of the product in exchange for performance that could potentially impact patient treatment or focus on the delivery of quality treatment options. It is imperative that quality care options be provided to patients and the re-compete may adversely affect this.”

More Audits in 2016?Buhrmester says 2016 could see more audits due to the fact the RAC auditors will be back in the game.

“We are seeing non-invasive ventilation (NIV) being audited heavily, as well as oxygen,” she says. “Due to the dollar amounts involved, the NIV audits could potentially create a serious finan-cial burden on companies. The challenges that suppliers are facing, in general, are that the reviewers are looking at the tech-nical aspect of the claim and not just the medical necessity.

“If a date is missing or the NPI is omitted on the order or the supplier failed to date stamp that the order was received, the supplier risks getting the claim or audit denied,” Buhrmester explains. “Thus, the supplier could possibly lose the patient to another supplier even though medical necessity was established.

“Providers have had to adapt their business practices to capture efficiencies in staffing and operations. It has been a difficult transition for some but opportunity still exists as the Medicare population increases and pressures to reduce hospital admissions grows.”

— Bob Hoffman, Nationwide Respiratory/VGM Group Inc.

“We are seeing non-invasive ventilation (NIV) being audited heavily, as well as oxygen.”

— Ronda Buhrmester, VGM Group Inc.

2016 Respiratory Market Outlook

Moving on, Moving up

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45October 2015 | Respiratory Management

2016 Respiratory Market Outlook

The cost of staff resources to work on audits continues to take a toll as suppliers who are already dealing with reductions in reimbursement and aging accounts. Providers must continue to work with their referral sources by educating them on the requirements.”

According to Coppola, the best approach for providers is to develop and implement a compliance program and constantly work with an internal audit team to ensure compliance. A major challenge with this is that it adds cost to providers and further pinches their profitability, but in the long run they should see greater billing accuracy and faster payment, he says.

Hoffman says there is no quick and easy answer to building your respiratory business. “Everybody has access to all the products and everybody can deliver them to the home but you can go broke pretty quick if you neglect the documentation it takes to get paid,” he says. “Keeping all of the intake personnel, sales force and delivery teams updated as to all the rules and regulations governing compliance requirements and educating your referral sources so they too understand the documentation complexities is key. It takes time and effort to get the referral sources on board but once they become your partner in under-standing the reimbursement requirements then you become the provider of choice.”

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RenewRenewThe power mobility market-place has been subject to consider-able regulator shifts. For example, in addition to competitive bidding, the removal of the first-month purchase option forced power mobility providers to transition to a rental model. But those providers weren’t alone — manufacturers of power mobility products also had to transi-tion with their customers.

Such changes have produced some surprising results. For starters, mobility — at least for some patients — is going retail. And the manufac-turers are responding to this change. Retail-ready PMDs are coming in tiers, with good, better best options that are reminiscent of cars, electronics and so many other consumer items. Likewise, the products that are being geared for the rental market are becoming simpler, more durable, and easy to repair, maintain and make ready for the next customer.

And vendors are helping providers respond to these pressures not just through new products, but through various services that help providers take gutsy leaps of faith into the new business models dictated by the changing reimbursement landscape. And retail and rental upgrades are just some of the ways PMDs are changing. Read this month’s cover feature to learn more.

Power Mobility’s Leap Forward . . . . . . . Page 14

Power Mobility Devices Respond to Market Change in the Right Ways

August 2015Volume 22, Number 8

hme-business.com

What’s Inside:

Special Retail Coverage . . . . . . . . . . 22

News, Trends & Analysis . . . . . . . . . . 8

Jumpstarting ICD-10 . . . . . . . . . . . . . . 6

People in HME . . . . . . . . . . . . . . . . . . 13

Leveraging Patient Data . . . . . . . . . . 18

DME’s Areas of Improvement . . . . . 34

Special Retail Supplement Inside

There’s an uncomfortable industry subject that no one likes to discuss, but for some HME providers, the topic is a business imperative. The elephant in the room? Mergers and acquisitions.

Provider M&As are a tricky topic in that there are many factors driving them and the biggest one of all isn’t very pleasant. Of course, we’re talking about competitive bidding. Over just a few years, CMS’s bid program for the Medicare DMEPOS benefit has clearly forced some providers out of business. Between making some HME providers abandon categories that had previously served as their chief source of income, and driving reimbursement down to barely profit-able levels, bidding has forced some providers to sell — and others to buy.

But competitive bidding isn’t the sole cause for M&As. Another key market force for M&As is demo-graphics. There are many external investors that consider the HME indus-try’s demographics — such as the legions of retiring Baby Boomers — impossible to ignore. These investors want in on the market, and are making what are often very enticing offers to buy provider businesses.

Simply put, M&As are now a fact of life for HMEs. Read this month’s cover story to better understand what’s involved in M&As and how they work.

HME Mergers &Acquisitions . . . . . . . . . Page 16

A Tough Topic, HME M&As Are Also a Business Imperative

October 2015Volume 22, Number 10

hme-business.com

What’s Inside:

Roundtable: Smart Strategies . . . . . 24

News, Trends & Analysis . . . . . . . . . . 8

Sneak Peak: Medtrade Products . . . 29

Respiratory Outlook . . . . . . . . . . . . 40

Eighth Annual Oxygen Survey . . . . . 46

CMS Doubles Down on Bidding . . . 50

SPECIAL SUPPLEMENT INSIDE

As providers have sought to rev up their retail sales efforts, they have become acutely aware that tapping into new revenue niches is a clear business imperative. The one key way to reliably and regularly expand a provider’s retail receipts is to identify unmet needs and help to serve them with the right products and service. Better yet, there are some retail-ready product categories that serve the needs of multiple patient groups.

Enter orthopedic products. There are a variety of patient segments that need orthopedic products, such as sports therapy and rehab patients, occupational clients, geriatric patients post-surgery and maternity. And the range of products that providers can offer these patients is equally broad.

Best of all, providers have the edge in serving these groups. While a general retailer might be able to offer some orthopedic goods, it won’t have the level of expertise that an HME provider has. And when customers are buying products to deal with a medical condition — even a minor one — they seek out the experts. This puts the provider in an excellent position to establish themselves as the “go to” resource in this category.

This month’s cover story examines how providers can bring their knowl-edge to bear in serving this key cash sales market opportunity.

Retail’s Orthopedic Opportunity . . . . . . . . . Page 30

Providers’ Health Expertise Can Open New Retail Sales Avenues

September 2015Volume 22, Number 9

hme-business.com

What’s Inside:

Streamlined Providers . . . . . . . . . . . 22

News, Trends & Analysis . . . . . . . . . . 8

Using CMS’s esMD . . . . . . . . . . . . . . 16

Sleep Patient Management . . . . . . . 18

Sports Rehab/Therapy Products . . . 38

The Interoperability Imperative . . . . 42

July 2015 Volume 22, Number 7

hme-business.com

“For manufacturers the challenge is simple, take cost out of the product in exchange for performance that could potentially impact patient treatment or focus on the delivery of quality treatment options. It is imperative that quality care options be provided to patients and the re-compete may adversely affect this.”

— George Coppola, Caire

Joseph Duffy is a freelance writer and marketing consultant, and a regular contributor to HME Business and Respiratory Management. He can be reached via e-mail at jduffy@hmemedia-group.com or joe@prooferati.com.

1015hme_RespOutlook4045.indd 45 9/22/15 4:02 PM

46 Respiratory & Sleep Management | October 2015

Oxygen Enjoys a Spike in Business Growth2015 Oxygen Market Survey

There has been much discussion about how the expanding patient base could give the respiratory industry the boost it needs. Industry experts have pointed out that an exploding senior population, the efforts to cut hospital admissions and the desire of the elderly to live out their days in the comfort of their own homes paint a picture of hope in respi-ratory providers finding enough market share to keep growing their business.

According to HME Business Magazine’s Eighth Annual Oxygen Market Survey, about 65 percent of respondents said that their oxygen business grew in the past 12 months. This is a significant jump from last year, where 53.1 percent of respondents reported growth. More about this year’s growth:

• 29 percent of respondents said they grew between 6 percent and 10 percent• 26.8 percent grew between 11 percent and 15 percent• 14.6 percent grew less than 5 percent

When it comes to the factors that most contributed to respiratory provider growth, three of the top four factors involved an increase in the number of patients:• 54.7 percent of respondents said they had an increased number of patients

due to referral sources (54.5 percent in 2014)• 13.3 percent had an increased number of patients due to being awarded a

competitive bidding contract (9.1 percent in 2014)• 6.7 percent has an increased number of patients due to marketing

campaigns (10.2 percent in 2014)Last year, 14.8 percent of respondents said their growth was due to the

reduction of competition in the marketplace. This year, that number was 13.3 percent.

• Decreased number of patients due to not winning a competitive bidding contract (27.9 percent)

• Decreasing Medicare funding due to rental cap or other developments with Medicare funding (20.9 percent)

• Decreasing number of patients from referral sources (16.3 percent)

Who are Your Patients?According to “Continuing to Confront COPD International Patient Survey,” COPD has risen from the fourth leading cause of death to the third, after heart disease and cancer, and has gained in prevalence over the past decade, growing from 6 percent to 7 percent of adults ages 40 years and older.

In our eighth annual oxygen survey, respondents report a 12% increase in those enjoying business growth over the last 12 months.

What factor most contributed to that growth?

In the past 12 months, has your oxygen business grown?

What factor most contributed to that contraction?

For 94 percent of survey respondents, COPD is the primary diagnosis for their oxygen patients. The percentage of their respiratory client base that has COPD was:• 49.9 percent of respondents said 51 percent to 75 percent of their patients

have COPD• 23 percent of respondents said 25 percent to 50 percent of their patients

have COPD• 19.4 percent of respondents said more than 75 percent of their patients

have COPDFor patients without COPD but use oxygen, respondents said that 55.2

percent of these patients have congestive heart failure, 13.4 percent have sleep apnea and 8.2 percent have pulmonary hypertension.

According to respondents, they say their COPD patients want the following:• 81.9 percent of respondents said patients want access to portable technology • 9.5 percent said patients want more comfortable therapy • 4.3 percent said patients want access to pulmonary rehab programs and/

or strategies of living with COPD Respondents said their COPD patients overwhelmingly want portable

oxygen concentrators (72.6 percent), followed by portable oxygen cylinders with conserving device (14.5 percent), liquid oxygen (5.1 percent), stationary

Contraction numbers were fairly similar when compared to last year’s survey. Fifty percent of respondents this year reported that less than 5 percent of their business contracted, where 41.8 percent reported less than 5 percent contraction last year.

Respondents said the factors that most contributed to contraction included:

Is COPD the primary diagnosis for your oxygen patients?

By Joseph Duffy

1015hme_OxygenSurvey4647.indd 46 9/22/15 4:08 PM

47October 2015 | Respiratory & Sleep Management

2015 Oxygen Market Survey

concentrators (5.1 percent) and transfilling systems (2.6 percent). Of their oxygen devices, 60.2 percent of respondents said patients find portability most and 57.3 percent said weight is most important.

When it came to ease of use, 51.3 percent of respondents said their patients prefer stationary concentrators to portable oxygen concentrators (26.5 percent).

ChallengesIn the last 12 month, respondents said pre- and post-payment audits (33.3 percent) created the greatest challenge for their oxygen business, while 22.3 percent said it was competitive bidding (Round Two or Round One or both). Pre- and post-payment audits had the same percentage as last year and competitive bidding dropped 6.8 percent from last year.

Joseph Duffy is a freelance writer and marketing consultant, and a regular contributor to HME

Business and Respiratory Management. He can be reached via e-mail at jduffy@hmemedia-

group.com or joe@prooferati.com. 

In the past 12 months, which of the following has createdthe greatest challenge for your oxygen business?

If you are in Round Two, have you bid on the current re-compete?

• 28.57 percent of respondents were successful in appealing up to 20 percent of their audited claims

• 9.5 percent of respondents were successful in appealing from 21 percent to 40 percent of their audited claims

• 14.3 percent of respondents were successful in appealing from 41 percent to 60 percent of their audited claims

• No respondents were successful in appealing from 81 percent to 100 percent of their audited claimsRegarding the threat to oxygen businesses posed by OMHA’s decision to

delay assigning ALJs to audit appeals by two years:• 38.1 percent of respondents describe the threat as Moderate — The delay

could represent a large chunk of my revenue being caught in limbo. • 33.3 percent of respondents describe the threat as considerable — The threat

posed by recoupment, fines and penalties is a major blow to my business. • 19.1 percent of respondents describe the threat as some — It is a frus-

trating delay, but we’ll be able to suffer through it.9.52 percent of respondents describe the threat as a game changer — Looking at the percentage of my claims audited and the dollar value of the recoup-ment, plus fines, plus delays is leading me to shutter or sell my business.

Competitive BiddingAlthough 22.3 percent of respondents called competitive bidding the indus-try’s greatest challenge this year, a drop from last year’s 29.1 percent, competitive bidding remains a serious concern for respondents, espe-cially those involved in the Round Two re-compete. About 71.4 percent of respondents who are in Round Two said they bid on the current Round Two re-compete.

Regarding oxygen business challenges caused by Medicare funding cuts, respondents said they are:• Maintaining customer service (34.8 percent)• Delivering equipment/oxygen cylinders (25.4 percent)• Maintaining respiratory therapist services (14.4 percent)• Servicing and repairing equipment (10.2 percent)• Providing oxygen for traveling/relocating patients (9.3 percent)• Negotiating pricing for oxygen for traveling/relocating patients (5.9 percent)

AuditsAudits are a serious roadblock for HME providers. AAHomecare said the out-of-control Medicare audit system puts paperwork before patients, jeop-ardizes critical care for patients due to the overwhelming number of rubber stamp denials, and hangs small businesses out to dry in the ALJ claim backlog.

The majority of respondents (33.3 percent) said audits were their greatest challenge in the last 12 year. According to survey takers, 47.6 percent of respondents claimed that over last year up to 20 percent of their claims have been impacted by pre- or post-payment audits. • 28.57 percent of respondents said 21 percent to 40 percent of their claims

were impacted• 14.3 percent of respondents said 41 percent to 60 percent of their claims

were impacted• 4.8 percent of respondents said 61 percent to 80 percent of their claims

were impacted• No respondents said 81 percent to 100 percent of their claims were impacted

For appeals occurring in the last 12 months, 33.3 percent of respondents said that between 61 percent and 80 percent of their audited claims have been successfully overturned by appealing.

A large majority of respondents (85.7 percent) said they expected further reimbursement cuts for oxygen with the Round Two re-compete.

And as CMS readies to expand competitive bidding reimbursement rates nationally on January 1, 2016, respondents were asked how they gauge the impact of this initiative on rural providers and patients. Respondents (85.7 percent) overwhelmingly said it will seriously impact on their patients’ care, while 14.3 percent said it will have limited impact on their patients’ care.

Who are the respondents?According to our respondents, 43.8 percent of them are respira-tory HME business owners, 35.9 percent are respiratory service managers, 19.1 percent are respiratory therapists at a homecare company and 1.2 percent are respiratory therapists at a hospital. Last year, a slight majority of respondents (39.2 percent) said their primary job was respiratory service manager while respiratory HME business owners were at 38.7 percent.

The majority of respondents (59.7 percent) don’t plan on leaving the oxygen business in 2016 because of competitive bidding, audits, the rental cap or other Medicare cuts. About 14.5 percent said they would be leaving next year while 22.6 percent are unsure.

The majority of respondents (32.8 percent) described their oxygen business model as a mixture of equipment options with emphasis on transfilling systems and/or POCs, while 31.3 percent said it’s a mixture of equipment options with emphasis on oxygen cylinder delivery. • 25.9 percent of respondents said their model is stationary concentrators and oxygen delivery only• 5.3 percent of respondents said their model is transfilling systems and POCs only• .8 percent of respondents said their model is liquid oxygen only

Respondents who sad they currently have a program to service traveling oxygen patients went from 71.1 percent last year to 78.5 percent this year.

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48 Respiratory & Sleep Management | October 2015

By Joseph Duffy

Over the last few years, portable oxygen has received much attention. Much of that stems from HME respiratory providers looking for ways to create new revenue streams and save time and money by becoming more efficient. When recently asked about top revenue opportunities that exist for respiratory providers in the coming year, Dave Marquard, Owner and CEO of OxyGo, LLC, and Applied Home Healthcare Equipment, LLC, pointed at portable oxygen concentrators (POCs).

“Portable oxygen concentrators are only 5 percent of Medicare oxygen billings and it is esti-mated that 60 percent of patients will benefit from ambulatory oxygen,” he said. “POCs will likely continue to grow and replace conventional methods, such as cylinders. More providers will see the benefits of replacing cylinders with POCs.” He also predicted that POCs will be the fastest growing

category of respiratory products from a cost reduction and patient satisfaction point of view.The 2013 Medicare HCPCS claims data for POCs (E1392) are $29.4 million (vs. $22.8 in 2012)

in allowed claims, which represent an estimated 50,292 patients. For HomeFill, that number is $31 million (vs. $32.5 in 2012), representing an estimated 53,258 patients. It appears POC use has caught up to HomeFill, at least with Medicare claims. And as Bob Hoffman, Vice President, Nationwide Respiratory, VGM group said, seniors have cash and their families are also more willing now than ever before to spend money on medical accessories.

“The POC market, travel CPAPs and any items to make their in-home care easier and more convenient present opportunities to create cash flow,” he said.

POC manufacturers continue to refine their systems. Over the last 10 years, POCs have become smaller, less expensive, lighter, more reliable, giving mobility back to many oxygen patients. And as there is increasing pressure to improve patient outcomes and reduce re-admittance for ACOs and hospitals, experts say POCs offer a better therapy that helps meet these goals.

Here are some of the latest portable oxygen options on the market:

Portable Oxygen Marketplace

Marketplace:

Portable Oxygen SolutionsAs portability demonstrates both a business and a therapeutic upside, the range of product options is getting broader — and more interesting.

LifeChoice Activox 4L • A 4.8-lb., FAA-approved device that provides up to

4 LPM eq. using Inova’s PULSE-WAVE Delivery, with an oxygen Sensor standard on every unit, and up to 10.25 hours of internal battery runtime.

• Controls include a Transflective display; clear alarm and charging notifications; simplified hour meter and purity readings; tailored compliance tracking.

• Standard accessories include a four-way carry case; adjustable straps; AC power supply; DC power supply; accessory bag; nasal cannula; and an external battery is available.

Inova Labs(512) 617-1700www.inovalabs.comBooth no. 1632

iGo Portable Oxygen System• Weighing less than 20 pounds, the three-liter concentrator is designed to assist patients in maintaining an

active lifestyle. • The iGo can operate in continuous flow mode from

1-3 LPM or in settings 1-6 using DeVilbiss PulseDose oxygen delivery technology.

• The iGo has a built-in DeVilbiss oxygen-sensing device to ensure accurate oxygen delivery and a reduced periodic maintenance schedule.

Drive Medical Design & Mfg. (877) 224-0946www.drivemedical.comBooth no. 911

NIOV Portable Ventilator • Using a 1-pound ventilator and

nasal-pillow style interface, the NIOV system combines with an external source of oxygen to deliver a set volume of oxygen each time the patient inhales.

• System can ventilate patients by delivering total tidal volume of up to 1,150 mL and positive inspiratory pressure of up to 18 cmH2O.

• The NIOV System detects a patient’s spontaneous breathing via sensor ports located in the nasal interface and delivers synchro-nized volumes of air and oxygen at rates of up to 40 breaths per minute.

Breathe Technologies Inc.(949) 988-7700www.breathetechnologies.comBooth no. 2344

Joseph Duffy is a freelance writer and marketing consultant, and a regular contributor to HME Business and Respiratory Management. He can be reached via e-mail at jduffy@hmemediagroup.com or joe@prooferati.com.

OxyGo Portable Oxygen Concentrator• Clinically validated for 24/7 oxygen use for use at home or away, the POC includes the company’s

Intelligent Delivery Technology along with four pulse flow settings: 1, 2, 3, & 4. • The device includes AC power supply and

DC power supply for mobile use in car, and it is wearable at 4.8 lbs with single battery.

• For usability, the OxyGo has simple control functions and easy-to-read LCD display.

Applied Home Healthcare Equipment LLC(440) 788-4101www.oxygo.lifeBooth no. 611

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