Stationary and portable oxygen concentrators: 'Room for both'

Tuesday, November 23, 2010

As portable oxygen concentrators (POCs) have proliferated in the past couple of years, some have wondered how their increased use would impact stationary concentrators. Would POCs be a technology that replaces the stationary unit, cylinders and all other oxygen delivery systems?

Those in the manufacturing sector say no--if anything, POCs are a technology that is augmenting the stationary concentrator instead of replacing it.

"The POC is not a replacement; it's a compartment," said Joe Priest, president and COO of Buffalo, N.Y.-based AirSep. "POCs are growing faster than the overall market growth rate because people are converting to them, but they are a secondary system."

Bob Fary, director of strategic alliances for Santa Barbara, Calif.-based Inogen, agrees that "there is room for both" when it comes to POCs and stationary concentrators.

"Patients are being diagnosed with COPD earlier and they're more mobile," he said. "This increases the need and desire for high-tech portable solutions."

The stationary/portable delivery model definitely has a place and its growth is rooted in technology, said Nancy Smoot, group product manager for stationary concentrators, aerosol and sleep for Elyria, Ohio-based Invacare.

"Current technology simply does not allow the mini compressors in POCs to have the same life span or life cycle costs as a stationary unit," she said. "Nor has the clinical community fully embraced the concept of pulse dosing at night. Using a stationary concentrator in conjunction with a portable addresses both of these issues."

Jay Vreeland, director of marketing for North America at Andover, Mass.-based Philips Respironics, says providers are continuing to evaluate how concentrators can benefit their businesses and are finding they can successfully implement both types.

"POCs are used in many different business models," he said. "A stationary concentrator and a POC is a popular combination that provides a patient with a stationary concentrator for home use and a POC for the ultimate in travel convenience. Providers also utilize POCs for those patients who like to travel whether the arrangement is a short- or long-term rental, or a cash sale. Some will also provide POCs at no cost in many instances."

Minimizing delivery

Cutting overhead expenses has become paramount for respiratory providers and the constant deliveries associated with cylinder oxygen are a major source of those costs. Implementing both stationary and portable concentrators is a workable solution, said Ron Richard, president of San Diego-based SeQual Technologies.

"The trend is to use non-delivery technologies to decrease costs--the POC is one option, but the focus on non-delivery will increase over the next several years," he said. "Providers are now doing more upfront analysis with long-term oxygen therapy patients to get them started on the appropriate oxygen systems to realize better margins and efficiencies."

Priest calls the stationary/portable delivery model "a great opportunity for providers" to diminish the costs associated with cylinder oxygen, though he maintains cylinders still have a place in the equation.

"Stationary systems are extremely cost effective and POCs are great for ambulation," he said. "The stationary can run 25,000 hours, which makes it ideal for the home, while the POC can be used strictly for ambulation. In tandem, they are durable enough to last five years."

The 36-month snag

Now in its second year, the 36-month cap on Medicare oxygen is "a supreme mistake by CMS," Priest says, because "it was an arbitrary insertion by the government that brought no value and cost the patient in terms of access."

Even so, Smoot says the initial bumps have pretty much smoothed out.

"I think providers have adjusted to the 36-month cap and figured out how to handle the 60-month restart process," she said. "Even with continuous reductions in reimbursement, providers can make the most of this market by being operationally efficient. To do so, they must fully understand their costs and ask themselves some hard questions, such as: Is it worth it to fix an old concentrator that is out of warranty?"