Genairex: The reimbursable friendly ostomy products
LARGO, Fla. – Genairex likes to keep things simple.
That goes for its product (generic ostomy supplies) to its corporate headquarters (the electric bill is only $400 a month thanks to its “green” design) to its management team (there’s no glut of vice presidents here) to its customer service (a live person always answers the phone).
What does this mean for HME providers? Genairex has been able to keep the prices for 101 of its 107 SKUs the same for 10 years.
“We feel that we’re doing our part as entrepreneurs to lower the cost of health care by not increasing our prices and offering an equivalent product at an exceptional price, so that providers can still make a profit margin and still take reimbursement,” said Steve Kuehn, owner and president. “We hope we can go another 10 years without raising our prices.”
Kuehn says Genairex is the fourth largest player in the $1 billion to $1.2 billion ostomy market. The biggest players: Hollister and ConvaTec.
In addition to keeping things simple, Kuehn credits Genairex’s average annual growth rate of 30% for allowing it to keep prices low.
“There’s no doubt about it that the price of raw materials are going up, and if the price of oil goes up, a lot of the plastics go up,” he said. “We’re fortunate that we can absorb those costs.”
Speaking of growth, Genairex expects that to continue. With Medicare to Medicaid to managed care organizations slashing reimbursement, not only providers but also consumers are looking for the best product at the best price.
“There are more people who don’t have insurance, or if they have insurance, this is a product that’s no longer covered,” said Sharie Hardy, senior vice president. “So the number of people paying out of pocket has increased and many patients can’t spend $400 out of pocket. We are their generic alternative.”