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occur suddenly or over a set period of time. This KPI, when considered
in accordance with a planogram (a guide that shows providers the most productive product assortment and self-placement based on space) can help a provider assess how different product categories in specific areas of the store are performing.
Another essential KPI for an HME provider is inventory turn times. A lot of home medical equipment is expensive, and the longer expensive items sit on the shelf, the longer the money spent to acquire that expensive item ties up productive cash flow. Retail is a cash-flow intensive business model, so when expensive items tie up that cash flow, profitability can stall or decrease. This KPI can help providers not only identify which items are selling and which aren’t but also develop strategies for pushing that product or replacing it.
For HME retailers, much more so than HME providers that exclusively generate their revenues through funding from Medicare and private payer insurance, tracking customers per day is crucial to understanding a retail store’s revenue. Without in-person customers patronizing the store and making retail transactions, the business will not survive. This KPI lets providers know if they need to funnel resources into strategies to increase foot traffic or even investigate whether or not they have an ideal location for their store.
Unless your business is completely devoted to retail, you will still need to track KPIs that are relevant to the funded side of the business. And in the case that your business accounts for all of these, you will need to monitor KPIs from across the board. Here are some traditional and crucial KPIs for Medicare and private payer providers:
As mentioned before, DSO has been a vital KPI for HME that should continue to be tracked, even as KPIs become more fine-tuned. A DSO tells funded providers the average amount of time it takes to collect revenue. The higher the DSO, the more limitations on cash flow. This metric can also
be an indicator of efficiency with which the business’s accounts receivable are managed.
The faster the turnover in accounts receivable, the more revenue you have on hand, so “held A/R” is a related KPI that reflects how much of a compa- ny’s accounts receivables is comprised of invoices on hold. A provider’s goal should be to minimize time between submitting a claim and receiving payment for it, and this KPI can point to even more granular details to watch, such as time to file the claim and accuracy of filed claims.
Claim submission volume helps providers keep a pulse on how many claims they are submitting on a consistent basis. A decrease in claim submission volume means revenue is going to decrease, so providers should set their objective at or above budget.
Claim denials are not only time consuming and frustrating but also costly as it slows down revenue collection. Percentage of denials as a KPI lets the
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E-COMMERCE WINNERS 10 HME categories that drive online sales
Special Portable Oxygen Section Inside:
• Oxygen Rental Models • Remote Patient Monitoring
• T r a v e l i n g W i t h O x y g e n
What’s Inside:
Effectively Using Planograms . . . . . 19 Special Portable Oxygen Section . . 22 e-PrescribingComestoHME . . . . . . . . 8 HowKPIsDriveProfitability . . . . . . . . 10 TheLatestSleepProducts . . . . . . . . . 32 Going the Distance Against Bidding . 34
As HMEs Enter e-Commerce, What Products Actually Sell?
A LOOK
What’s Inside:
Medtrade Product Innovations . . . . 24 News, Trends & Analysis . . . . . . . . . . 8 Shoprider’s Group 2 XLR Chairs? . . . . 14 Funding for Breast Prostheses . . . . . . 16 Incontinence and Urology Offerings 33 Forging a Sales Strategy that Works . . 34
HME Experts Take a Look at the Industry’s Horizon
Every October HME
Business gets together with some of the members of its Editorial Advisory Board and asks them which trends will impact HME providers in coming months or might already be making themselves felt .
As the years have passed by, the list of trends continues to grow and diversify . Where most members’ attention once focused mainly on Medicare reimbursement, the list now includes developments from across the post-acute care continuum and even healthcare as a whole .
For instance, where the board once would discuss competitive bidding as a monolithic threat to the industry (and in some respects it still is), the discussion now looks at how providers can expand their revenue sources and whether or not they want to bill Medicare at all . As another example, retail-minded providers are no longer considering entry-level, how-to concerns, but are instead pondering big issues such as competing with major online sellers such as Amazon . Every year, just when we think we have the industry all figured out, the board continues to surprise us with nisenwotdreifnfedrseannt .dTiankseigahltos,oaknadt this year year’s roundtable to see what’s on
H 2 M0 1 E 8 ’ s H H o M r i z E o B n . A d v i s o r y
Board Roundtable . . . . Page 18
O c t o b e r 2 0 1 8 Volume 25, Number 9 hme-business.com
July 2018 Volume 25, Number 7
Management Solutions | Technology | Products
hme-business.com | January/February 2019 | HMEBusiness 23
“While a generic system may include some general financial tools, an HME-specific software solution is more likely to help a provider monitor and respond to the KPIs that are most impactful to its strategic goals.”
— Patty Harrison, Computers Unlimited
2018 BUYER’S
The future is
here: e-com- merce is becoming a business
AHEAD
GUIDE
YOUR COMPENDIUM OF RESOURCES GEARED TO HELP YOU GROW.
imperative in the HME industry, and if providers aren’t already diving in, they are making it a part of their strategic business planning .
Simply put, it’s where the customers are . According to a June 2017 Forbes article, online sales grew faster in 2016 than they had over the past three years and account for 11 .7 percent of overall retail sales . There seems to be no stopping this sea change of how customers shop and get much of their product information, and that includes home medical equipment and related products .
The question is what products not only lend themselves to e-commerce but actually sell? You can offer all sorts of products, but what are the things that will get clients to add items to their cart and enter their credit card information . To answer that question, we got some expert insight into the 10 categories of HME products that have proven themselves to be e-commerce winners, and some of those categories just might surprise you .
Additionally, we rounded up a number of product examples for each o r i e f t s h t o o s g e i v t o e p y o 1 0 u e a - p c o i c mt u m r e e o r c f e t h c e a t t e y g p o e - s of items you can add to your online
o s t f o f e r y r i n t o g s l e . a F r l i n p mt o o r t e h . i s m o n t h s ’ c o v e r
e-Commerce Winners . Page 11 A V u o g l u u s mt / e S e 2 p 5 t , e N m u b m e r b e 2 r 0 8 1 8 hme-business.com
FOR
FOR HME
MUST-KNOW TRENDS IMPACTING PROVIDERS IN COMING MONTHS
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What’s Inside:
Annual New Product Awards . . . . . . 12 Non-Medicare Oxygen Options . . . 24
ProviderStrategy . . . . . . . . . . . . . . . . . . 8 TheCaseforCPAPCleaners . . . . . . . . 9 NewOxygenOfferings . . . . . . . . . . . . 28 Noridian, CGS & the 60-Day Rule . . . . 30
HME IT EVOLUTION
HME Software Keeps Pace with Post-Acute Care’s Changes
As the HME industry hurtles through various public policy, market and care challenges, providers have relied upon one business asset more than any other to help them evolve with change: their software systems . HME software is more than just billing and claims management — it helps businesses strategically respond to and manage change .
Managing change has become a key capability for any healthcare business serving the post-acute care sector, and the industry’s software systems have evolved and changed to address those changes . Now, in addition to the broad HME management systems, there are solutions designed to help providers manage specific aspects of their businesses . There are IT tools explicitly tailored for HME accounts receivable; business analytics; delivery management; document imaging and management; e-commerce; and even e-prescription .
To help you stay on top of the evolving list of options available to help your business adapt to change, HMEB has once again conducted
our annual software roundup . We’ve surveyed a variety of systems to see the latest developments and features they’ve incorporated to help your business deal with the HME sector’s constantly unfolding changes .
Annual HME
Software Survey . . . . . . Page 18
The latest enhancements
to the industry’s software offerings.
For today’s HME Marketplace Renew your subscription today!
November/December 2018 Volume 25, Number 10 hme-business.com