Providers take hard look at businesses

Sunday, October 30, 2011

YARMOUTH, Maine - It's the economy, stupid.

It's also competitive bidding, reduced reimbursements and increased costs of doing business that have providers taking a hard look at their businesses. Some have had to lay off long-time employees.

"Overhead, gas, insurance, wages, workman's comp--maybe the nationals can absorb it, but I can't," said Mark Ehlers, owner of Ehlers Health Supply in Stockton, Calif. "I just gave a pink slip to an employee doing some of my sales. She's been here close to 10 years, and we have to let her go next month."

Other providers have cast a critical eye on low performers--from products to payers.

"We are analyzing the equipment we can't afford to keep in play any more," said Steve Ackerman, owner of Spectrum Medical in Silver Springs, Md. "The return is too low and the expectations are too high in terms of service turnaround time, documentation and the prospects for audits."

Provider Seth Auerbach brought in a consultant to assess ways Komfort & Kare Home Medical Equipment & Supplies could improve efficiencies. In a move that might have seemed unthinkable a few years ago, the provider said "no" to one of its long-time referral sources.

"I told a state agency we are not going to supply them any more because we have not received payment in quite some time," said Auerbach, president of the Westmont, N.J. company. "We're being more strict, and looking at it payer by payer."