Just the facts, please
Back in August I attended Invacare's Media Day, and recently Invacare emailed me a bunch of information from the various presentations. Many of the slides are relevant only in the context of the total presentation, but I was able to pull out some data that can stand on its own. Here's that data followed by my take on what it all means.
- Global Population: 6.6+ billion
- 21% Online: = 1.4+ billion
- 65+ Population: 15% = 1+ billion
- 65+ Population (US) = 77 million
- 65+ Online (US): 30% = 25 million
- Seniors spend on average 45 minutes a day online, and the majority of Baby Boomers use search engines to gather health-related information.
- Senior are more likely to click on online ads and more likely to purchase an item than younger people.
My take: When I see this kind of information, I can't help but think that HME providers really need to figure out how to use the Internet to reach potential customers. We're talking millions of people on line looking for health care information and products. This market is just going to keep growing. Think of your own buying habits. Aren't you buying more and more stuff online? I know I am. If I can point and click, pay with a credit card and have the product delivered to my door, what's not to like? This is one boat you don't want to miss. Somehow, someway, you need to figure out how to integrate internet sales and marketing into your business plan.
Patient healthcare spending
-Out-of-pocket healthcare spending in 2010 will reach an estimated $290 billion
-Average employee total out of pocket costs for healthcare are estimated to hit $4,023 per person in 2010. This projection is $367 (10%) higher than 2009 figures.
-Collecting patient-owed balances is challenging and time-consuming and many providers are not pursuing these balances
- Many providers recover less than 40% of their patient-owed A/R
- Patient pay recovery is beginning to represent a provider's margin.
My take: You pay your co-pays and deductibles. Make your patients do the same. If you can afford to not collect 40% of your patient A/R, than your reimbursement is way too high. I dare you to try and convince me otherwise.
In 2008, the Medicare oxygen market included 1.1 million stationary patients and 711,858 patients using portable oxygen; 64% of these patients used both stationary and portable oxygen; 36% used stationary only.
How to interpret this data:
- Stationary oxygen is a mature market with 5% to 6% average top line growth
- In 2008 there were approximately 1.5 million distinct Medicare O2 patient claims annually with a monthly average of 1.12 million patients
- The combination of claims, patient life cycle and annual net growth suggests there are about 45,000-55,000 new patient starts/month
- Net ambulatory oxygen patient growth per year for all O2 patients = 57,000
My take: Hmmmm. A stable mature market with shrinking reimbursement. Lincare has begun to diversify and reduce its exposure to Medicare oxygen. For most providers, it's time to play Follow the Leader.