As reimbursements shrink and expenses grow, it is important for HME companies to find and embrace new profitable niche markets. One potentially high-profit market segment is CPAP (continuous positive airway pressure) and VPAP (variable positive airway pressure, also known as bilevel positive airway pressure) device sales. CPAP and VPAP are used in treating obstructive sleep apnea (OSA), a disorder that affects an estimated 18 to 25 million people in the United States—only 1 million of whom are aware of the problem.¹

About 60% of dealers already provide some sleep apnea equipment. But thanks to growing awareness of OSA in the medical community, physicians are identifying more of the millions of undiagnosed OSA patients. HME providers need proper marketing to assure they get their share of the growth in this niche.

Why Bother
If the potential of millions of new home care customers is not exciting enough to get you to take another look at the sleep apnea product market, there are several other reasons to concentrate on this niche. First of all, the market goes beyond just providing the CPAP and VPAP units. The masks, headgear, humidifiers, and humidifier filters used with the units can provide added sales for your company. Investors Business Daily identified CPAP and VPAP masks as the second most demanded product in the medical device industry. So, no matter where a customer obtained the unit, your company can become the place to go for replacement masks. Also consider that the extra supplies many patients want—but which are not covered by third-party payors—can supply added cash sales.

A small percentage of the HME dealers who sell sleep apnea equipment also provide sleep studies. The studies are more expensive to offer than the equipment, and having the results interpreted can be costly. The advantage of doing the studies is that it often results in the referral for the equipment.

Population-based research suggests that 2% of women and 4% of men over the age of 50 have symptomatic obstructive sleep apnea.² This is good news for HME providers struggling with shrinking Medicare reimbursement rates because for patients under the age of 65, reimbursement is primarily through traditional insurance companies, HMOs, and private pay.

The Key to Success
Consulting with HME companies for the start-up and operation of sleep apnea divisions, it became obvious to me that there is one golden key to success: marketing and sales. You need not add a new salesperson to make sales into this niche if your current sales staff is doing a good job. However, you must provide sleep apnea-specific sales training and education for both your sales and customer service departments. It is not that the treatment is radical or unusual, or that sleep apnea products are a mystery to the medical field, but the sales imperative is a little different than that for other respiratory sales.

Getting Started
Most HME companies with a staff respiratory therapist use this person’s professional resources to train other staff members in sleep apnea. They in turn must make sure that the delivery staff is knowledgeable in the setup and basic instruction for the equipment. One advantage of servicing sleep apnea equipment is that it rarely generates after-hours or weekend emergency calls, and problems can almost always be resolved the next business day.

Once your staff is trained, you can concentrate on the marketing and sales program itself. If your respiratory therapist is a great salesperson, then you can save the money and time you would normally spend training a nontherapist in the clinical side of the sale. But not all good respiratory therapists make good salespeople for sleep apnea business.

Aim the sales effort at physicians who see sleep disturbances, such as internists, family practitioners, cardiologists, pulmonary physicians, and, to a lesser degree, obstetric/gynecologic specialists. Start by making a sales blitz in your market featuring only sleep apnea. Stop by every office that you can identify as possibly being interested in your services and products to leave a brochure. If possible, visit with the physician or set up a time to present your sleep apnea products.

When developing the brochure that you will leave at physicians’ offices, describe the services and equipment you offer. The brochure should point out the quality of your customer service and patient follow-up. Include a section on the equipment you can provide in your brochure. This should list all sleep apnea equipment, sleep study equipment, masks, and ancillary supplies. Highlight the ability of your equipment to track and record patient data, especially if the equipment allows you to access remote patient data and change settings and treatment without making a trip to the patient’s home. Remote access allows the physician to maximize treatment options in a cost-effective manner. Finally, include an additional section featuring other respiratory products available from your company.

Picking Product Lines
Choosing the best equipment for your company to rent or sell is a very personal decision. There are several factors to consider. If you want to provide sleep study services, either with a physician or on your own, then you need to purchase a machine that records sleep habits overnight. I would also suggest that you get at least one portable diagnostic system to make sleep studies convenient and reliable.

Deciding on a mask manufacturer is also important. Carrying a double-layer cushion design is a good idea because it improves mask fit and comfort, thereby increasing patient compliance.

When looking at CPAP and VPAP machines, study the ones that provide the best therapy at the lowest pressures. Most devices track patient compliance and usage, and some even have a visual display that tells the patient when the mask fits properly. The best clinical protocols include use of equipment that allows you to both track the patient compliance and evaluate the efficacy of the treatment prescribed.

Customer Service and Sales
In developing the marketing tools needed to sell CPAP and VPAP equipment, you should emphasize the expertise and training your staff has in this field. Be careful in the selection of the manufacturer you choose to partner with. The best will help train your staff, including the respiratory therapist, in the clinical and functional aspects of the equipment. They will also provide you with clinical articles you can give to referral sources. Include the availability of these studies in your brochure along with a flow chart that explains how your company answers a service call and the steps you take to assure patient satisfaction. Emphasize your trained intake staff who will follow up with the patient, insurance company, and referral source to ensure the patient gets the needed equipment.

I find that after making four or five sleep apnea sales calls, most companies are able to visit with more than 40% of physicians. After these visits to physicians, about half of them will regularly refer sleep apnea equipment and between 25% and 50% will be interested in reading the clinical studies the company can provide.

In the group of physicians that are already active in the sleep apnea market, more than half will refer to your company if you have some new and innovative technology or expanded service to offer. After getting a referral, be sure that the patient reports his or her satisfaction to the referring physician. After the physician gets calls from one or two satisfied patients, you should be able to retain a reasonable share of the equipment business.

Finally, don’t be discouraged if the first few calls don’t pay off. We have found that the results do not generally start to materialize until you make four to eight calls. Keep trying and soon you will have grabbed your piece of the growing CPAP and VPAP business.

Steve Lutzker is principal consultant with The Lutzker Group Inc, Escondido, Calif, and a specialist in health care consulting and marketing. For a list of OSA clinical studies useful in informing physicians and educating staff and more information on equipment selection, contact Lutzker at (760) 480-9060 or email him at consultlutzker@sprynet.com.

References
1. Le Bon O, Hoffmann G, Tecco J, et al. Mild to moderate sleep respiratory events: one negative night may not be enough. Chest. 2000;118:353-359.
2. Strollo PJ Jr, Rogers RM. Obstructive sleep apnea. N Engl J Med. 1996;334:99-104.