Hope Medical halves Medicare dependency
SAN ANTONIO – Hope Medical’s January acquisition of Wheelchairs Plus is part of a strategy to keep pushing the company forward—including branching into complex rehab and orthotics and prosthetics.
“We’re on a path of specialization,” said Kathleen Weir Vale, CEO of the San Antonio-based company. “These are not areas that traditional DME providers operate in, and it’s a departure for us.”
That departure includes Hope Medical’s new complex rehab venture, its two-year-old orthotics and prosthetics location, and a recent foray into CPAP and urological supplies—all intended to reduce Hope Medical’s reliance on Medicare, Vale said.
Hope Medical is in a Round 2 competitive bidding area, and is a contract supplier for negative pressure wound therapy. Before bidding, Medicare comprised 33% of Hope Medical’s business. It is now 15.5%. Vale says the payer is not a good bet.
“Even before competitive bidding, working with Medicare, with its onerous documentation requirements, was questionable,” she said. “Competitive bidding rates are well below our cost of doing business. We have many other contracts with health plans and payers that are not on a campaign to defund us.”
With Wheelchairs Plus’ pediatric focus and strong relationship with Medicaid, the acquisition should help Hope Medical diversify even further, says Tom Cottle, former owner of Wheelchairs Plus.
Cottle will stay on as one of three ATPs and the company will keep its name and strategic location—a 3,000-square-foot showroom in the South Texas Medical Center.
“Now I get to go out and do more of what I want to do,” said Cottle. “I really enjoy serving the pediatric population, and now I can focus on that.”
Even with three specialized lines in place, Vale sees more changes on the horizon for Hope Medical.
“When Hope Medical started in 1941, we were selling ‘sick room supplies,’” said Vale. “We’ve survived this long by being light on our feet. You have to be agile, and not get stuck in the old way of doing things.”