Smart Talk

Q. Is pursuing an M&A transaction process the right decision for my organization?  A. Typical motivations to begin an M&A process are to generate owner liquidity, mitigate personal financial risk, raise capital to fund growth initiatives (e.g., acquisitions, new service offerings, etc.), gain strategic resources and infrastructure capabilities, or take a step back from the business to retire or explore other ventures.   M&A processes can also create opportunities to partner with like-minded...

Q. Are there any efforts to improve processes during a disaster?   A. Recently, the Emergency Preparedness for HME Suppliers Committee, along with VGM and AAHomecare, has been encouraging DMEPOS suppliers to take a survey with questions regarding all the unthought-of expenses associated with a disaster. The committee has been working to illustrate to the U.S. Department of Health and Human Services, CMS and state/federal emergency groups the lost dollars and additional expenses incurred before,...

Q. What needs to be prioritized during a search for an HME location?  A. When opening, moving or scaling an HME/DME facility, the process of finding a suitable location that will best support your business needs can be a time consuming – and potentially frustrating – process. We streamline the undertaking by working backward; it’s time to ditch the standard real estate filters, and instead, look through the lens of compliant space considerations. Ready for your future-self...

Q. How can I show my employees that I care about them?  A. The No. 1 question asked by employees in today’s workforce is “Does my employer care about me?” The answer to this question is not what you can do but rather who you can be for them. How you show up for your employees is felt well before you do anything for them. The following two examples will help build bridges between you and your employees.  Actively listen  Part of asking whether an employer...

Q. How will rising interest rates affect the M&A market for HME businesses?  A. As the Federal Reserve has raised interest rates to help combat inflation, private equity sponsors who utilize debt to finance a portion of their acquisitions have been faced with higher borrowing costs. Debt providers typically price loans off a certain benchmark rate (e.g., LIBOR, federal funds rate, etc.), and as those benchmark rates have risen, the cost of debt to finance acquisitions has increased alongside...

Q. Can I get reimbursed for lost/destroyed equipment after a disaster?  A. Last month, we discussed preparing for a natural disaster. That article could not have come at a better time as Hurricane Ian recently ripped through much of Florida, the Carolinas and other coastal states. We hope everyone was able to prepare for the disaster.  It seems appropriate now to discuss post-disaster resources.    Government assistance is available if/when the White House declares a national...

Q. How do I optimize profitability and compliance by evaluating my product category accreditation?  A. Whether starting a newly accredited DME or adding accreditation to an established facility, evaluating which product categories to include on your application can be an overwhelming process. However, it’s also one of the most important. From CPAP to powered mobility to diabetes supplies, specializing your business in one or a few categories can be a determining factor of your operational...

Q. Where do I start when it comes to a culture overhaul in my business?  A. The most effective way to start a cultural revolution is to start with you. The Great Resignation has caused an overwhelming amount of finger pointing, which leads to victimhood. Whether you are the frustrated CEO or a disgruntled downline employee, if you believe the problem exists in your environment/outside of you, you are powerless to change it. When we take full responsibility for everything in our lives, we...

Q. How has the M&A environment for HME providers shifted over time?   A. Following the introduction of competitive bidding in the early 2010s, M&A activity in the HME sector grounded to a halt, as reimbursement was cut drastically. However, as the marginal impact of each subsequent round of competitive bidding lessened and the reimbursement environment stabilized, investors demonstrated a renewed interest in HME providers, driven by market tailwinds that have positioned the sector for growth....

Q. How do I prepare my business for a natural disaster?  A. The key is being proactive and not reactive.  There are many responsibilities a business must maintain. One of those should be routinely updating your emergency preparedness/disaster plan because disaster waits for no one and can hit at any moment. It is also imperative for those who serve oxygen patients or any other life-saving devices to keep updated records of the patient information.   Here are a few other tips:  Schedule...