Invacare hikes price on concentrators

Monday, December 7, 2009

ELYRIA, Ohio – Invacare will raise the price on its standard 5-liter oxygen concentrators, the Perfecto2 series, by 4% to 5% on Jan. 1 and reduce the line’s warranty from five years to three, the company announced today.

Invacare made the moves to offset a big increase in the cost of components, especially compressors, that took effect Aug. 1, 2009, said Carl Will, senior vice president, North American Homecare

“I’m buying the same compressor that I was buying, but at a 35% to 40% increase,” Will said. “I tried to get another supplier to quote me, and he quoted me 50% more than what he quoted me last time. Those guys aren't making any money.”

The price increase and warranty reduction offset the higher cost of the components. Without making the changes, Invacare would lose money on its Perfecto2 line, Will said. 

The changes do not affect Invacare’s HomeFill, which already has a three-year warranty, as do the company’s portable oxygen concentrators.

Invacare’s 5-liter concentrators currently use a 40,000-hour compressor. In the first quarter of 2010, the company will release the Perfecto2 V, a 5-liter concentrator powered by a 25,000-hour compressor. For this new product, providers will pay a “slight premium” but still keep their pricing near today’s current price, Will said.

In a letter to its provider customers dated Dec. 8, Invacare stated the following:

Our industry continues to go through unprecedented challenges and change.Reimbursement cuts seem to occur almost annually and negative HME legislative issues seem to be ever present. As reimbursement has steadily declined for providers, manufacturers have concurrently experienced drastic price compression. Although many areas of our business have been impacted, the oxygen concentrator line has suffered price compression at an unprecedented and unsustainable rate…We simply can no longer afford to absorb such significant component cost increases and therefore, must change our concentrator pricing structure.