Brad Schmidt: Connecting with docs
SHREVEPORT, La. - Despite ever-mounting restrictive Medicare policies governing the HME industry, Brad Schmidt believes the secret to success ultimately rests with quality patient care. Team up with physicians on planning each patient's treatment and the rewards will come, he said.
The strategy has certainly worked for Schmidt's company, Red Ball Medical. Since becoming a partner four years ago, Schmidt has overseen a 200% increase in the number of oxygen patients the company serves. He attributes the growth to establishing close relations with referring physicians.
"We integrate our services into the physician's plane of care," he said. "Physicians who give us referrals know we will work with each patient, give them the instruction they need and follow up with them as often as necessary. We provide a unified care plan."
Although he sounds like an RT, Schmidt's bailiwick is business administration. He holds a bachelor's degree in the field from Louisiana Tech.
His first healthcare experience came at a hospital management firm, where one of his biggest projects was assembling a materials management team. As so many did during the dot-com craze, he defected to the IT industry for a couple years before joining Red Ball.
Schmidt doesn't discount the profound impact Medicare reimbursement cuts have had on respiratory margins, but maintains that the market is still promising for astute providers.
"The sheer demographics and future growth potential of the business excites me," he said.
"It's different from other industries where you might look for an area with huge profit potential. Because everyone gets basically the same revenue per item, this is not a margin-based business. Success depends on getting the highest volume of patients and providing the most service for the lowest cost."
Although commonly maligned as unprofitable, liquid oxygen is Red Ball's main modality because Schmidt believes in its therapeutic value. The fiscal challenges are ancillary, he contends.
"The key to liquid is managing your costs, educating your patients on the proper use of the equipment and negotiating the best price possible on your supply contracts," he said. "The main thing is to take ownership of the process and learn how to make money at it."
Ages: 36 Company/position: Red Ball Medical/COO Headquarters: Shreveport, La. Annual sales volume: $2.5 million Years in HME business: Eight Membership in professional organizations: AAHomecare, VGM, immediate past president of MESA Business motto: "Give people more than they expect"