Are you a dead man walking? Time will tell

 - 
08/10/2009

Here are tidbits from two interesting interviews I've had recently. I think there's food for thought in each.

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First, when you consider what providers have gone through this year—a 9.5% reimbursement cut and the oxygen cap, for starters, and competitive bidding on the horizon—the wreckage so far has not been all that bad.

There’s been no wave of bankruptcies or providers going out of business. But it could be just a matter of time before that happens, said Carl Will, Invacare’s group vice president for HME.

“You probably have a lot of people who are dead men walking and don't even realize they are dead yet,” he said.

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That’s because it takes four to six months before reimbursement cuts begin to affect provider cash flow. With that in mind, the number of providers going out of business should pick up pretty soon, he said.

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When it comes to Group 3 power wheelchairs these days, the old high-performance bases are becoming a thing of the past. The current reimbursement won’t support such robust offerings, said Tim Pederson, CEO of WestMed Rehab in Rapid City, S.D.

Given that, it’s critical that manufacturers do everything possible to make Group 3 wheelchairs that enhance a provider’s margin—and that goes beyond pricing, Pederson said.

“It has to not just be trouble free, but easy to service,” he said. “Batteries need to be accessible. The motors need to be accessible. There are a lot of things at play here.”

As for customers who want a Group 3 wheelchair more appropriate for yesterday’s reimbursement that today’s, Pederson knows exactly what to say.

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“That’s why we have the ABN,” he says. “If someone want bells and whistles, we’re happy to provide them, but it’s cash, check or credit card.”

– Mike Moran