A Changing Landscape Requires a New Direction
- By Scott Meuser
- Nov 01, 2010
Change is the only constant” seems an
adage tailor-made for our industry. In
the past year we have witnessed dramatic
shifts in the American healthcare system.
The passing of the Patient Protection
and Affordable Care Act has created a
significant number of challenges, in addition
to the implementation and expansion
of competitive bidding and the elimination
of the first-month purchase option for standard
power wheelchairs in 2011.
Yet even in the face of considerable
adversity, there is significant opportunity.
The entrepreneurial provider understands
that this is an industry with an ever-changing
landscape, and that knowledge and flexibility
are needed to adapt and succeed.
While at press time the industry was continuing its fight in Washington
to stop competitive bidding and delay the elimination of the first-month
purchase option for one year, all providers should plan for implementation as
scheduled for January 1, 2011. In this new environment, efficiency and sound
business strategy will make the difference between simple survival
and continued success.
Plan to Succeed
Despite the new challenges, the data for overall industry growth speaks
There are 78.2 million aging baby boomers who have already begun demonstrating
their willingness to pay out of pocket for the mobility equipment that
helps them stay active. Currently, $256 billion is being spent, and that number
is expected to increase by 10 percent each year.
To take advantage of that growth, providers need to expand their retail
product portfolios. This active population of discerning customers demands
high-quality, feature-rich products, so providers should stock their showroom
with a wide variety of retail products. This demographic can also provide
business growth via simple cross-selling opportunities. Offer complete mobility
solutions. For example, vehicle lift systems are perfect companion products for
scooter and power chair sales.
Another consumer segment with growing numbers is the bariatric population.
Recent data shows that two-thirds of the adults in the United States
are overweight, and one-third of that group is considered obese. Strong
consideration should be given to offering a selection of bariatric products in
As some providers exit the Medicare reimbursement segment of the industry
in response to the challenges ahead, there will be a very real opportunity for
those who remain to expand their marketshare. Those who are able to adapt
and align their businesses with the new rules and regulations will be well
positioned to grow their business.
With Group 3 complex rehab successfully carved out of competitive bidding,
albeit with lower reimbursement levels, the standard power business is where
the greatest challenge will lie. The elimination of the first-month purchase
option for standard power wheelchairs will necessitate a shift in the way business
is done, as providers wait 13 months to receive full payment. Providers
should thoroughly examine how the Medicare rental business works in other
segments of the HME industry to help develop a similar business model for their
standard power business.
To succeed, providers will need to partner with manufacturers that truly
understand the business and that have the industry’s best interests in mind for
the long term. To succeed in Medicare rental, it will be necessary for providers
to look at more than the bottom line.
Product Quality Is Crucial
History shows that most Medicare beneficiaries use their power chairs 13
months or more after initial issue. So unless the beneficiary enters an in-patient
facility prior to the transfer of ownership, the original power wheelchair will be
with them through the full rental period. For that reason, offering high-quality
products will be even more important under the mandatory rental payment
system than it is today.
The key to success in the rental segment is the understanding that warranty
claims mean lost profits. You must offer beneficiaries power chairs that can
deliver trouble-free performance throughout the 13-month rental period.
The power chairs should also include components that are relatively easy to
re-condition for efficient turnaround at the end of the rental period. Look for
products that utilize efficient technologies, dependable motors and electronics
that deliver long-term reliability with little to no service needs within
the warranty period.
Providers should align with top-quality manufacturers, as your reputation
depends greatly on the products you offer. When you deliver wellknown
quality brands, you will be perceived by consumers as a reputable,
quality provider. Your standard power products should deliver the features
your customers want, while still delivering value. Positive word of mouth is a
powerful marketing tool, and providing the right products goes a long way in terms of customer satisfaction. When you generate
brand loyalty for your company and the products
that you provide, you are building a strong
consumer network that will want to continue to
work with you.
Trust Is Invaluable
Choosing the right manufacturer is essential to your
success in the new environment. Providers need to
partner with a company they can trust not only to
provide them with the right products, but also to
deliver the business support and efficiency today’s
Support manufacturers who continue to fight
for you and your clients in Washington. Understand
that by doing business with them, you continue to
invest in the future of the industry.
The right partner will offer support services
specifically designed to help your business grow in
the current environment and will offer the tools,
insight and education needed to help you to be
ready for whatever comes next. While the industry
will continue to evolve, it is important to see the
opportunities that change brings, and it’s vital that
you partner with those you trust to provide the
products and services to help you take
To succeed in this turbulent climate, it is
imperative to lead your company with flexibility,
adapting and evolving as industry changes dictate.
Although this may alter the original vision
you had for your company, it is the only way to
succeed and thrive in the ever-changing reimbursement
This article originally appeared in the November 2010 issue of Mobility Management.
Scott Meuser is chairman and CEO of Pride Mobility Products Corp./Quantum Rehab, based in Exeter, Pa.