Hope is not a strategy

Ask most anyone at Medtrade earlier this month, and they'll tell you there was something in the air.

Sure, questions over competitive bidding loomed, but there was a feeling that, while the industry has experienced significant attrition in the past few years, those providers that remain are on solid ground, if not motivated to be on solid ground.
The data in this year's State of the Industry Report, which will be published on our website in December, seem to reflect that perception.

First, there's overall DME growth by category. All categories, with the exception of medical/surgical supplies, saw an increase in allowed charges from Medicare in 2018, with total allowed charges of $5.7 billion vs. $5.1 billion in 2017. Of particular note was the wheelchairs category, which saw a 10% increase in 2018 vs. 2017. In fact, when you compare 2018 data to the previous five-plus years, one might even call it a small rebound, though still far below 2012 levels ($8.1 billion), the year before competitive bidding expanded significantly in 2013.

Second, there's the number of providers in the $3 million to $10 million range, and the number of providers in the $10 million and up range—they increased 16% and 6%, respectively, in 2018 vs. 2017. I recently talked to Bernie Lambrese, who is rebuilding his consulting business, and he said what the providers left in the market need to do is get bigger. Simple as that.

Third, there's the list of top 100 providers of DMEPOS and their allowed charges from Medicare in 2018. While there wasn't much jockeying in this year's list compared to last year's—the top four companies remained the same: Lincare, Accredo, Lincare Rx and Walgreen—there was an increase in their allowed charges in 2018. Lincare saw a 19.6% increase; Accredo, 6%; and Walgreen 7.4%. Of the top four, only Lincare Rx saw a decline, 7.4%. Beyond the top four, Apria Healthcare, in the No. 5 spot, saw a healthy 6.5% increase.

Of course, another reason for the good buzz at Medtrade: The changes to the bid program for Round 2021. Everyone hopes the industry will see increased single payment amounts when they're released next summer, but as the saying goes, hope is not a strategy.

It's time to act—whether it's shifting your business model or advocating for changes on Capitol Hill or, ideally both—and the attendees at Medtrade were doing just that.