HME NewsPoll: If manufacturers sell direct, look for all hell to break loose

Thursday, December 16, 2010

YARMOUTH, Maine - The vast majority of HME providers say that under no circumstances would they work with a manufacturer that sells product direct to end users, according to the most recent HME NewsPoll.

"One of our vendors is selling directly to the public through Amazon and is able to undercut the price to the point that sometimes we can't even buy the product as inexpensively as the vendor is selling it online," said one poll respondent "This is not right, and we have almost entirely stopped ordering anything from that vendor."

The NewsPoll asked providers two questions around this highly charged topic. The first question: Do you think Medicare's competitive bidding program will drive manufacturers to go direct? To which 74% (206) said yes; and 26% (71) said no.

The second question: Would you continue to buy products from manufacturers who sell direct to end users? To this, 14% (38) said yes, while 86% (242) said no.

When it comes to selling direct and reducing the role of HME providers in the distribution channel, Jeff Boltinhouse, vice president of Healthwise Pharmacy in Greenville, N.C., spoke for most respondents when he said, "Under no circumstances would this be okay."

"I cannot support a manufacturer who is competing with me," added another provider.

A number of providers, however, said it would be OK for manufacturers to sell direct under the following circumstances: The product requires little or no service, it is not reimbursed by Medicare or it is a high-priced item that most HME providers do not carry. Products that fall into this category, according to those providers, include adult diapers, orthopedic bracing, mail order supplies, light therapy, air fluidized beds and bath safety items.

Other providers said that it is a free country. If manufacturers want to sell direct, it's their choice.

"It's pretty presumptuous to tell someone who they can and cannot sell their goods to," said one poll respondent. "They will have to decide what is riskier: selling direct or going through providers. It will be hard to straddle the fence. Ultimately, it's their choice. I say bring it on. Competition is good."

While a number of poll respondents supported this free-market philosophy, most took a very dim view of manufacturers selling direct.

"It will change how the whole industry is structured and operates, putting many out of work and out of business," said Colorado provider Craig Shilhan.

Others cited service as a concern: Manufacturers aren't set up to provide it.

"I certainly understand that competitive bidding is causing providers to demand lower prices on products," commented Cliff Doss, CEO of AireCore Medical Services. "This is leading manufacturers to look at alternative ways to sell their products, but I still feel a sense of betrayal and will likely not do business with these manufacturers. Also, there is no way they can adequately service their patients, so by supporting them, you are supporting sub-standard care."