NCB doesn't control your future: It's still up to you

Saturday, November 30, 2002

Some HME providers have been inclined, particularly during the past few months during the debate on national competitive bidding, to lament that they don't control their fate and that they are subject to forces that make it impossible for them to succeed.

Well, I disagree. These "others" – the regulators, legislators, 60 Minutes producers, faceless medical reviewers, appeals judges, whomever, are not going to determine your fate. You are. Those who fail have only themselves to blame and won't be getting any sympathy from me.

Let me explain why.

I believe that almost all the important factors that determine if an HME provider survives and prospers or falls behind and fails are within his or her control. Sound business practices, knowledge of product and continuing education, skillful marketing, flexibility and hard work are common to all retail success stories.

Of course, when our business is compared to many "main street" retail ventures, there are important distinctions: 1.) A large proportion of the end-use customers are not the "specifiers" of the product to be supplied and didn't themselves select the retailer; 2.) There are significant regulatory/legal risks and costs of providing and billing for the products; and 3.) A significant portion of the cost of many products is paid for with funds from 3rd-party sources.

But, providers who get to work early, stay late, know the regulatory and competitive environment inside and out, market ceaselessly, educate themselves daily, remain flexible and have the true belief that they are making a difference in their communities, cannot help but win.

Yes, you will get audited. But if you educated yourself about billing, audit procedures, review and appeal, you will win and establish yourself as a "hard target" for future audits.

Yes, you will likely have to face a national competitive bidding scenario and perhaps state Medicaid bids as well. But, if you know your costs, bid smart, position yourself correctly and take advantage of networks and affiliations, you can still get a fair price and by expanding and diversifying your product line be even stronger.

Yes, you will get "cherry-picked" by managed-care payers and then face denials after jumping through all the hoops. But you will learn with whom you can do business and how to protect yourself from unfair treatment. You will deal from your strong points of being close to the customer and referral source and leverage the money out of even the most stubborn "payers."

Yes, you will face narrow margins and increasing operational costs. But you will learn which products and services leave you with the best gross profits and focus on those, while reducing your reliance on products with narrow margins. You will learn to hire right and keep quality people who you train regularly.

After all this and more, you will still be in a business where major international corporations are still buying up your competitors and hundreds of entrepreneurs start new ventures each year. (VGM broke a 16-year record for new members in August - right in the middle of a fierce fight on Capitol Hill over NCB. Many of these were new ventures.) And remember that seniors, our main patient group, are a growing and very vocal voter group who are not going to stand for second-class treatment in any healthcare area. Socialized medicine will not be tolerated.

Simply put, we are the only existing delivery mechanism for a treatment of choice that is also the lower cost modality of treatment. The payers need us even if they don't seem to know that on a day-to-day basis. The underlying demand for our products and services is strong and growing. Not only are there more seniors, there is a growing percentage of seniors who are disabled and want and need our products. As much as the media, Congress, auditors and others seem to hate us, they can't do without us.

That doesn't mean you or your company will survive. No one owes you success just because you are in business now. If you are complacent, lazy and uninformed, you will be replaced. But it won't be by some machine or a giant corporation, it will be by another local HME provider who is willing to work, learn and care. It is up to you.

Van Miller is CEO of the VGM Group in Waterloo, Iowa.