By choice or necessity


Managing Editor Theresa and I were talking yesterday about the news that United Healthcare will be pulling out of the Obamacare exchanges in all but a handful of states.

The reason: The health insurance giant is losing money in the health exchanges. Just how much money? Oh, an expected $650 million this year alone.

There’s obviously a lot of buzz about this news in the mainstream media, but Theresa and I were scratching our heads over whether or not there’s an angle for our little niche-y publication.

We didn’t come up with anything yesterday, but I was still scratching my head about it this morning.

I don’t know that there’s an impact on HME providers from United Healthcare’s decision per se, but there may be a message in it for them.

(Before I continue, please put all politics about Obamacare and United Healthcare aside, and bear with me.)

As a $157.1 billion operation (As Theresa says, “That boggles the mind”), United Healthcare has the luxury of making a number of decisions that HME providers can’t afford to make, but on a basic level and from a business perspective, there’s something to be said about a company deciding to forgo a line of business because it has led to losses.

This seems to be a predicament that a lot of HME providers find themselves in these days, with another round of competitive bidding pricing delivering even steeper reimbursement cuts than the last.

A recent HME Newspoll asked HME companies if they accepted the competitive bidding contracts they were offered, and there were a lot of comments to the effect of: We accepted them because we had no choice.

Tell that to Josh Temple at OxyMed, who emailed me yesterday. He considers the company a “mom-and-pop,” with two locations. It lost about 45% of its business, when the original Round 2 hit the area.

“That was when we were forced to look into different avenues to remain profitable and, most importantly, in business,” he says.

Temple says OxyMed significantly increased the business it does with commercial insurances and with private-pay customers. It has hanged its hat on offering a service-intense respiratory and sleep program that includes a wide variety of products, one-on-one education, and follow-up care.

“Since we opened in 2010, we have doubled our size, moved into a bigger location and added employees, all while not receiving a Medicare bid,” he writes.

United Healthcare and OxyMed may be miles apart, but they have one thing in common: They’ve learned to say no, either by choice or necessity.