HME News TV: Reduce costs, re-deploy cash

Friday, February 24, 2012

The average oxygen delivery costs between $25 and $100--most of it in non-value added steps behind the scenes, says Joe Lewarski, vice president of clinical affairs for Invacare. With reimbursement cut to the bone--in competitive bid areas it doesn't even cover the provider's cost, he said--it's important for providers to rethink their approach, Lewarski told HME News TV recently.

Order intake, cylinder filling, the actual delivery and the return of unused product--each of these steps creates cost in the system, but offers no value to the patient, the referral source or the provider, says Lewarski. 

"There's an opportunity for oxygen (providers) to shift to a technology-based approach to eliminate those costs," he said. "That allows the patients the same--and maybe improved--access without driving costs to the back end."

Lowering costs, in turn, frees up cash flow that can be redeployed to retain clinicians, said Lewarski.

"The therapist can play a big role in patient education, improving outcomes and interacting with referral sources," he said. "Those things bring value to the organization."

Outcomes, in particular, are going to become very relevant over the next few years, as healthcare systems are held accountable for certain readmissions, said Lewarski.

"Any kind of activity that the provider can participate in that lowers the risk of patients being readmitted, particularly within the first 30 days, will add value to the whole system and add value to their referral sources," he said.