Inogen settles into role as HME provider

GOLETA, Calif. - Inogen had a busy end to 2011. The manufacturer-provider of portable oxygen concentrators (POCs) expanded its geographic reach into Tennessee and Florida, and won a contract to provide products and services to TriCare military members in 21 states.

Scott Wilkinson, vice president of sales and marketing for Inogen, says you can expect more of the same in 2012.

"Like any other provider, we're going to try to continue growing our patient base," he said.

Inogen now has a presence pretty much nationwide for Medicare, and a presence that's growing for other payers.

Breathing easy in Tennessee

In Tennessee, Inogen acquired Breathe Oxygen Services just outside of Nashville to meet a requirement that providers must have a physical location in the state. It wasn't the first time Inogen has acquired a provider, and it probably won't be the last, Wilkinson said.

"We are continuing to look for the right opportunities," he said.

While there are several cities in Tennessee scheduled for Round 2 of competitive bidding, Wilkinson said the program wasn't the driving force behind the acquisition.

"We're trying to serve patients all over the country," he said. "If there wasn't competitive bidding, we'd still want to serve patients in Tennessee. It just so happens that there is competitive bidding and this allows us to bid."

Eliminating 'blind spots'

In Florida, Inogen obtained the necessary state licenses to serve patients. It already works with providers in the state to provide POCs, but previously, its hands were tied in areas where those providers didn't have a presence.

"We don't have partners in every corner of the state, so there were still some blind spots," Wilkinson said. "Now we can play the role of default guy if there's no one else."

Adding Florida to its service area was "a big deal" for Inogen, Wilkinson said.

"As you know, Florida has a lot of oxygen patients," he said.

Diversifying is a priority

Like any provider, Inogen aspires to do business with more than Medicare, and the contract with TriCare goes a long way toward meeting that goal.

"We're trying to break down insurance barriers, just like state barriers," Wilkinson said.

Betting on non-delivery

While the transition to non-delivery oxygen therapy hasn't been fast enough for some, Wilkinson believes it will happen--soon.

"I think people started to embrace it, but competitive bidding did two things," he said. "It's gotten people interested, because they know they have to do something big, but they're hesitant to make the investment, because they don't know if they're going to get a contract. Once that shakes out, you're going to see a more rapid acceptance and conversion."