In brief: CMS extends comment period; DJO sells, Aeroflow buys

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Friday, November 30, 2018

WASHINGTON – CMS has extended a comment period for its plans to add new product categories to the competitive bidding program. The agency will now accept comments through Dec. 17. CMS included the new categories—ventilators and off-the-shelf knee and back braces—in a recent final rule. The proposal caught the industry by surprise and the inclusion of vents, in particular, has stakeholders concerned. AAHomecare has formed a ventilator workgroup to develop comments to the proposal. The VGM Group has pulled together talking points for providers who plan to comment. CMS plans to phase in the new product categories in all CBAs in the next round of competitive bidding.

M&A: DJO sells, Aeroflow buys

ANNAPOLIS, Md. – Colfax Corp. has entered into a definitive agreement to buy DJO Global from an investment group led by private equity firm Blackstone for $3.15 billion in cash.

Colfax provides air and gas handling and fabrication technology products and services to customers around the world, primarily under the Howden and ESAB brands.

“The acquisition of DJO is a compelling next step in the strategic evolutions of Colfax that creates a new growth platform in the high-margin orthopedic solutions market,” said Matt Trerotola, president and CEO of Colfax. “We see significant opportunities to apply our proven Colfax Business System across DJO to create a continuous improvement culture, further improve productivity and margins, and accelerate innovation and new product development.”

Upon closing, DJO Global will operate as a new segment within Colfax and be led by Brady Shirley, DJO president and CEO, who will report directly to Trerotola.

For DJO, the deal boosts the company’s potential operational performance and growth, says Shirley.

“Colfax team’s operating expertise across a broad array of businesses makes them the ideal partner to help us build on our momentum, drive new levels of innovation and continue to deliver outstanding service to our customers,” he said.

Colfax, which trades on the NYSE under the ticker symbol CFX, expects to finance the deal with about $100 million in cash from its balance sheet, proceeds from credit facilities and a contemplated debt offering, and $500 million to $700 million from a contemplated offering of equity or equity linked securities.

The deal is expected to close in the first quarter of 2019.

Aeroflow expands resupply biz

ASHEVILLE, N.C. – Aeroflow Healthcare has acquired Integrity Medical’s CPAP resupply business. “We look forward to providing exceptional care for new and existing PAP patients in Georgia and are happy to add resources to Integrity Medical to help refocus its missions,” said Andrew Amoth, corporate development manager. Augusta, Ga.-based Integrity Medical also provides products in the following categories: lift chairs, respiratory, walking aids, bathroom safety, seating and positioning, and patient room. Aeroflow has also acquired HealthCare Plus’ resupply business for CPAP, urology, incontinence and wound care. Polson, Mont.-based HealthCare Plus will focus on its pharmacy business. Earlier this year, Aeroflow bought the CPAP resupply business of Vernon, Conn.-based Med-Caire.

Improper payments for HME decrease

WASHINGTON – The improper payment rate for DMEPOS decreased from 46.2% in 2016 to 35.5% in 2018, representing a decrease of $1.14 billion, according to a bulletin from AAHomecare. The improper payment rate for all Medicare fee-for-service decreased from 9.5% in 2017 to 8.1% in 2018. The association met with CMS’s Comprehensive Error Rate Testing team in June to explore ways to continue to improve error rates.

Compass Health sponsors AAHomecare

CLEVELAND – Compass Health has joined AAHomecare as a bronze level corporate partner. “When the opportunity presented itself, it was an easy decision to support AAHomecare due to their tireless work in support of the HME industry” said Gregory Zenko, senior vice president of Compass Health’s HME Business Unit, in a press release. “With acute care facilities being incentivized to discharge patients quickly, it’s imperative that CMS creates balanced and fair programs allowing patients to properly and safely heal at home.” Compass Health manufactures a broad range of homecare, rehab and pain management products. Its consumer brands include Carex, AccuRelief and Apex. Its professional brands included ProBasics, Roscoe Medical and Meridian Medical.

Insulin use to increase, study finds

NEW YORK – The amount of insulin required to treat Type 2 diabetes is expected to increase by more than 20% from 2018 to 2030, according to a new study published in The Lancet. Using data from the International Diabetes Federation, researchers developed a microsimulation of the Type 2 diabetes burden across 221 countries. The number of people worldwide with Type 2 diabetes is estimated to increase from 405.6 million in 2018 to 510.8 million in 2030. Insulin use is estimated to increase 616.1 million 1,000 IU vials per year to 633.7 million during that same timeframe.

People news: Sullivan, Distasio, Lowman, Turner, Gill, Stone

Connie Sullivan has been named president and CEO of the National Home Infusion Association. Sullivan most recently served as vice president of research and innovation at NHIA…Jeffrey Distasio has been named senior director of Pride Sales. Distasio has more than 20 years of sales experience and previously held positions at Gillette, Duracell, Aramark and Bausch & Lomb…Darren Lowman has been named chief supply chain officer at National Seating & Mobility. Previously, he worked as director of strategic sourcing at Tractor Supply Co., a $7 billion retailer…Kelly Turner is stepping down as director of People for Quality Care to pursue a new opportunity at VGM. Collin Brecher will step in…Harjit Gill has been elected to ResMed’s board of directors. Gill has more than 25 years of experience in health and consumer technology products in Asia, Europe and the Middle East. She replaces Dr. Gary Pace, who retired Nov. 15…Jerry Stone has been appointed to AAHomecare’s board of directors. Stone is vice president of payer relations for National Seating & Mobility.

Diabetes study: Current standard of care inadequate

SAN FRANCISCO –Sixty two percent of patients with Type 2 diabetes are not satisfied with their current standard of care, according to a new study from Virta Health.

What’s more, 66% of healthcare providers believe the average patient is unable to manage their disease with the current standard of care.

The online study, conducted by students from Purdue University, sampled 168 adults and 48 healthcare providers in the United States.

Other patient findings: 43% think information from their provider is poor; 34% think the timeliness of advice from providers is poor; and 93% believe they are knowledgeable about the symptoms of Type 2 diabetes.

Other provider findings: 66% don’t think three to six month appointments are effective in managing care, with 44% saying monthly appointments are necessary; 83% think their patients do not disclose accurate information about their health between appointments because they forget the details; and 72% think the majority of their patients are taking action to reach their A1c goals.

Virta Health is a technology enabled online clinic that provides treatment for Type 2 diabetes and other chronic metabolic diseases without medication or surgery.

Reliable Respiratory partners with senior health plan

NORWOOD, Mass. – Reliable Respiratory has partnered with PACE Organization of Rhode Island to provide sleep and respiratory equipment, and clinical and administrative support, to its members. PACE members will also receive one-on-one coaching through respiratory therapists, online ordering and equipment tutorials, according to a press release. “We are honored that PACE has trusted us with their participants, and we are glad to welcome them, and their caregivers, into the Reliable family,” said Eric Mongeau, vice president of sales & marketing at Reliable Respiratory. “Our visions are closely aligned: supporting and empowering patients to be healthy at home.” Reliable Respiratory serves more than 40,000 patients across New England.

Moneyline: Reliable Medical Supply, Viemed

MINNEAPOLIS – Reliable Medical Supply has recapitalized with Chicago-based private equity firm Seven Hills Capital. RMS is a DME provider specializing in complex rehab serving patients throughout Minnesota and western Wisconsin. "This is an ideal partnership for us," said Debra Kalk, president and CEO. "Not only do we gain a strong financial partner with Seven Hills, we also increase our capacity to gain market share through acquisition." Financial terms of the transaction, which was facilitated by Vertess, were not disclosed…Lafayette, La.-based Viemed Healthcare has received approval from the Toronto Stock Exchange to issue a bid for common share of the company. Under the terms of the bid, Viemed may acquire up to 1,895,575 common shares. Daily purchases under the bid will be limited to a maximum of 37,537 common shares. The bid will commence Nov. 29, 2018, and terminate Nov. 28, 2019.

Industry loses rehab icon

EXETER, Pa. – Mark Smith, the general manager for public relations and consumer research for Quantum Rehab and Pride Mobility Products, passed away on Nov. 25 surrounded by his family. Smith, who was born with cerebral palsy and used a wheelchair, supplied input on various projects and provided consumer feedback to the research and development team for the two companies. He joined Pride and Quantum in 2001. Smith was also a prolific writer, authoring five books and countless magazine articles and columns. Additionally, he was known for his blog www.powerchairdiaries.com, formerly www.wheelchairjunkie.com. Smith is survived by his wife, Holly, and daughters, Emily and Annabelle.

Invacare layoffs shift to Europe

ELYRIA, Ohio – Invacare plans to reduce its workforce in Europe by about 50 employees, according to a filing with the Securities and Exchange Commission. The move is part of the company’s long-term plan to achieve $12.5 million of operating margin improvement from cost reduction activities specifically in Europe. Invacare expects to incur total pre-tax cash restructuring charges, primarily related to severance and transition assistance, of about $900,000, which will be expensed in the fourth quarter in the Europe segment. Once the reduction is complete, the company expects it to generate about $2.5 million in annualized pre-tax savings. To date, Invacare has announced cost reduction actions that will result in about $5.8 million in annualized pre-tax savings toward its $12.5 million goal. Earlier this month, Invacare announced that it had once again reduced its workforce in the U.S. by about 50 employees.

Golden, Ultrafabrics partner on lifetime warranties

OLD FORGE, Pa. – Golden Technologies now offers lifetime warranties for breathable fabrics on its lift chairs. The company is offering the extended warranties on its lift chairs that use Brisa by Ultrafabrics. “We are excited to partner with Ultrafabrics to offer the only lifetime warranty for all Brisa breathable fabrics on lift chairs in the industry,” said Rich Golden, CEO. “This collaboration marks the fusion of true comfort seating and luxurious Brisa fabrics—both built to last.” The warranties, subject to Golden’s terms and conditions, begin from the date of shipment to the buyer and last for the life of the chair.

Groups re-energize their marketing efforts

WATERLOO, Iowa – A group of HME industry advocates convened at VGM’s headquarters in November for a workshop to share best practices for digital marketing and social media consumer-focused campaigns.

Their goal: to use these campaigns to advance grassroots legislative efforts that benefit the industry.

“For the first time, representatives from (a number of) industry groups have joined forces to better engage the communities we serve through grassroots campaigns on social media, with a unified intention of advancing legislative efforts that protect and serve our customers and providers,” said Lisa Wells, vice president of marketing for Cure Medical, who facilitated the workshop.

Representatives from the following groups participated: NCART, AAHomecare, VGM and VGM Forbin, U.S. Rehab, MAMES/SWMESA, People for Quality Care and Essentially Women.

The workshop, sponsored by VGM, educated attendees on best practices for recruiting and engaging consumer advocates who rely on HME; proven methodologies for deploying HME advocacy campaigns using people-first language, video content and specific media channels; messaging that drives powerful engagement; and appropriate imagery that properly reflects HME consumers in an authentic way.

“Everyone who attended this workshop is headed home eager to implement a refreshed approach to our grassroots strategy and the way we continue to build our respective networks of advocates,” said Mickae Lee, director of advocacy and communications for NCART. “Participants shared an impressive range of perspectives and ideas around the table, and I’m excited to see the resulting impact for our industry.”

Coalition pushes leadership to pass accessories bill

WASHINGTON – The ITEM Coalition has sent a second letter to leaders of the Ways and Means and Energy and Commerce committees in the House of Representatives, urging them to pass H.R. 3730. The bill, sponsored by Reps. Lee Zeldin, R-N.Y., and John Larson, D-Conn., would stop CMS from using competitive bidding-related pricing for accessories for complex rehab manual wheelchairs. The letter follows up on an earlier letter sent in September. “We now urge you to pass this important legislation before the end of the year to ensure Medicare beneficiary access to manual CRT wheelchair accessories and to capitalize on the significant bipartisan support for the bill in Congress,” the letter reads. The bill currently has 122 supporters. The ITEM Coalition, a national consumer and clinician-led coalition advocating for access to and coverage for assistive devices, technologies and related for people with disabilities, has 30 members, including the National Multiple Sclerosis Society, the United Spinal Association and the Christopher and Dana Reeve Foundation.

RRI regulators now include value-add

ST. LOUIS – Responsive Respiratory has upgraded its custom logo regulator offering to include a free pocket duration guide with purchase. All standard and high-flow regulators purchased with a custom engraved logo will now include the new cylinder duration card at no charge in every box, the company says. “The pocket duration card was developed as a result of RRI’s Customer Feedback Initiatives and addresses one of the primary concerns for oxygen users: How long will my cylinder last,” says Tom Bannon, president. RRI also offers an “O2 To Go Duration App,” but the company knows that not all patients have access to this technology.

Short takes: Medtrade, BOC

On Dec. 3, SmartSaver Conference Passes will be available for Medtrade Spring, April 16-18 at the Mandalay Bay Convention Center in Las Vegas. The passes are $99 and allow full access to educational sessions and the expo hall. SmartSaver Expo Passes are $25 and allow full access to the expo hall. “For those who already know they are going to Medtrade Spring, these are the rates to grab,” said Sarah Varner, marketing director. “The conference pass offers a $100 savings over Early Rates and an expo pass saves $25”…The BOC board of directors has announced the election of its 2019 executive committee and two new members. The officers on the executive committee are Wayne Rosen (chairman), Mark Parris (vice chairman), Joshua Bressler (secretary), Daniel Griffis (treasurer), John Own (member at large) and L. Bradley Watson (immediate past chairman). The new members are Justina Appel and Cameron Stewart.