Why the pressure to reduce readmissions will change the future of oxygen referrals

Tuesday, September 9, 2014

Thanks to the Affordable Care Act the whole U.S. healthcare system is being challenged to remodel itself. Largely, these challenges are financially driven. For the DME industry, it’s national competitive bidding, and for hospitals, it’s reducing 30-day readmissions. As all healthcare providers are assessing how they are going to survive and thrive in this new environment, one thing is clear: Everyone, including DME providers, must figure out a way to improve outcomes while being paid less.

Why outcomes? It all starts with the hospitals. One easily measured hospital outcome is avoidable readmissions that occur within 30-days of discharge. These readmissions have been singled out as a multi-billion dollar target.

Not all hospitals are doing the same things, but every hospital is committing a great deal of its resources to this effort to reduce readmissions. Not knowing what will and won’t work in their institutions, hospitals are collecting lots and lots of data. Once a critical mass of data has been gathered, they will then be in a position to identify what is working, what’s not and what works best. Much of this data has to do with the who and the how of health care is provided in the hospital. But community resources that impact the patient following discharge are also being measured. Nursing homes, home health agencies and durable medical equipment providers are all part of the new data stew.

Before data can be used to guide decisions it needs to be gathered in a sufficient quantity so that it can be trusted. That’s where we are today: the information gathering stage. However, at some point hospital administrators will have the data they need to identify the best and worst physicians, nursing units, care paths, home health agencies and DME providers. Providers whose data reflects favorable outcomes (reduced readmissions) will be rewarded at the expense of those whose data supports worse outcomes. For DME providers, that could mean the difference between formalizing a preferred provider agreement or elimination from the referral rotation list.

Not every hospital will be collecting exactly the same data, and not all will be tracking the impact of DME referrals on outcomes. However, given this uncertainty, it is better to error on the side of assuming that you will be under the microscope, as opposed to finding yourself there and hoping for the best. As they say, hope is not a good strategy. Instead, think about what the hospitals are trying to achieve, which patients they are most focused on, what your involvement is with those patients and what you might be able to do differently to possibly reduce their potential for readmission.

When talking about competitive bidding, it’s often said that being awarded the oxygen bid only gets you in the game, you still have to win the referrals. Being the big winner of referrals requires differentiating yourself from the competition. In this new data-driven world, differentiation comes in the form of better patient outcomes. This may sound expensive, but it doesn’t need to be. Taking even the simplest steps should eventually show results. Improving outcomes can be as simple as titrating conserving device settings or spending an extra few minutes teaching patients about their disease.

Possibly the single most important action you can take today is to begin to track your own readmission rates. Maybe you’re already doing great, maybe not. But the last thing you want is to be sitting with a hospital administrator who is spouting statistics about your company’s “outcomes performance” and all you have is speculation. Data is power and lack of data is debilitating. So start calling your patients 30-days after they were discharged (and assumedly set up on oxygen) and ask some questions. Just be sure one has to do with any hospitalizations in the past 30 days. Then use a spreadsheet to track your results. Who knows, you just might be pleasantly surprised and have the basis for a new marketing campaign.

It’s impossible to say if a specific hospital is tracking outcomes to DME providers, but it seems prudent to assume that they are. Bobby Unser, the three-time Indianapolis 500 winner, once said, “Success is where preparation and opportunity meet.” So seize this opportunity, collect your data and use it to propel more success into your company’s future.

Bob Messenger BS, RRT, CPFT, FAARC, is manager, respiratory clinical education, at Invacare. He can be reached at bmessenger@invacare.com


Bob Messenger makes a very important and compelling point about the HME industry's need to ddemonstrate value and collaborating to compile data that shows the industry's effect on health outcomes, cost and readmission reduction.  

It’s ironic that the issue was clearly highlighted years ago in an article that included the same points in an interview with HME news regarding the industry's need to focus on data and health outcomes. (Pertelle's mission, outcomes) If perhaps something would have been done to begin the process back in 2005; the conversations potentially would be a little different.  

While the author was correct in noting the ACA has intensified data colection, reporting on quality, outcomes and readmissions; they are also measuring and posting results of the patient's perspective of care, as well as comparisons of physicians, hospitals, home health and hospice organizations.  

One point of clarification, is the fact that hospitals - - - are in fact collecting and reporting "the same types of data" and clearly are not concerned with the competition knowing their results, but moreso about how to improve so the consumer chooses them over their competitor.  

Centers for Medicare and Medicaid Services (CMS) compiles the data and posts the performance results on their website for the general public to view.  The description of the programs along with data sources can be found in the following links:


CMS does not currently measure the clinical services of HMEs because they don't believe, or are not aware of; the fact that clinical services exist.  The focus of CMS is solely on equipment. 

That said, value based health care has not been the focus of HMEs.  So it’s a huge learning curve to change the patterns and practices of the past to what the industry should have evolved to at this point: value based health care “providers” versus equipment “suppliers”.  

Unfortunately, there exists no comparative measures on the HME industry regarding their value and effect on quality and outcomes. Why? Well much of the reason has to do with the fact that: by-and-large - - clinical services are frankly not provided by the vast majority of HME companies.  

The companies that do provide clinical services, typically don't publish the results of their interventions in peer reviewed journals; which by the way would establish the premise for creating value-based clinical services that lead to better quality or improved health outcomes for the entire industry.  

Thus far the primary efforts of the industry continue to be with lobbying members of congress - - to repeal NCB and replace it with MPP.  Frankly those efforts have been ineffective in changing the perceptions of the HME industry by policymakers, CMS, third party payers and consumers. 

So, it may be that it’s time to do something else..... Perhaps begin to collaborate on how to create a process to begin developing programs that are value-based to support data collection, impact on health outcomes and costs? Sort of like what was highlighted in the article back in 2005.  The timing is right and the opportunity is clear.  The next question should be; when do we start?  

Just my opinion and certainly not shared by everyone, (unfortunately) but the facts are what they are...

Nice job with the article Bob! 

Kindest regards,

Vernon R Pertelle, MBA, RRT, LVN, CCM