In the mid 1990s, Les DeFelice (left) — a rehabilitation technician for a company that wanted to exit the rehab business — was shown the door. But instead of sending out his resume, DeFelice followed through on a lifelong ambition to run his own business and founded DeFelice Care in Wheeling, WVa.

Seven years later, DeFelice’s former employer, Liken Home Medical, is now part of Lincare Holding’s national HME network, the result of a 1999 acquisition. Meanwhile, DeFelice Care is making a name for itself, thanks to a patient-first philosophy instilled by its founder and upheld by a 37-person staff that includes a number of people DeFelice worked with back in his Liken days.

Today, when Les DeFelice discusses the genesis of his company, he doesn’t start with a tirade against his former company, or cite a strategic business plan that paved the way to success. Instead, he talks about a key administrative assistant, Cathy Reck, who handled billing and authorizations when DeFelice Care opened its doors in March 1995 with a skeleton crew. “It wouldn’t be a company without Cathy,” DeFelice says.

Giving credit is a cornerstone of DeFelice’s management style, and it is no small clue into why his company is thriving. In an industry with its share of top-down corporate policy-making and fragile loyalties, DeFelice has attracted a talented, hard-working team by giving his people a sense of purpose and security.

“We would not be here without Les’ heart and trust,” says Suellen Champion, RT, DeFelice Care’s vice president of respiratory therapy. When Lincare acquired Liken in 1999, Champion found herself on the outside looking in—a victim of the restructuring that so often accompanies mergers. DeFelice could relate, of course.

“When Sue became available, she gave me a chance to put together a business plan for respiratory,” DeFelice says. It turned out to be quite a business plan.

With little to lose but plenty to prove, Champion reunited with DeFelice. She brought along customer relationships cultivated over a decade in the Wheeling-area respiratory market. She also brought with her a couple of coworkers who saw their days were probably numbered as well. Overnight, DeFelice Care—a four-person rehab outfit for the first 4 years of its existence—became a competitor to be reckoned with in respiratory care.

Today the company employs 37 people, operates a second branch in Uniontown, Pa, and will generate revenues approaching $4 million this year.

But that kind of “ballistic” growth, as DeFelice calls it, can be fraught with danger. DeFelice recognized that he needed a savvy, experienced financial manager to help chart a long-range growth plan for the company. Once again, he did not have to look far. He called upon Todd Westcoat, another former Liken coworker who, ironically, had played key roles in both displacing DeFelice at Liken and launching DeFelice Care.

“At Liken, I had recommended that we get out of the rehab business because the profit margins were not there,” says Westcoat, a former Liken controller. “As a result of those recommendations, Les was displaced, and I wanted to help him get his business running.”

Westcoat provided weekend help with everything from accounting to telephone systems. Now he is on board full-time as vice president, secretary, and treasurer. “Todd is the third phase after Cathy and Sue,” DeFelice says.

Les DeFelice (right) encourages employees, such as Linda Beabout (seated), Lee Ann Barkey (left), and Ellen Castilow (center), to think independently.

That third and current phase finds a company that has shed its start-up skin and now has its eyes on becoming a “sizable regional HME provider,” according to DeFelice. (In fact, the company’s success in respiratory care has led to a reevaluation of the business focus, and this year DeFelice Care began phasing out its rehab business.) The foundation of the company’s success is an operating philosophy that is deceptively straightforward, and one that has been touted by many other companies before. The difference, perhaps, lies in the execution.

“I work for my associates, they work for our customers—that is our management philosophy,” DeFelice says. “I am a sounding board; I advise, I share our goals and vision, and we provide every opportunity for our people to be successful in their own careers. It is so dead simple.”

Simple, but like common sense, not so common, it would seem. “People like the security of knowing that the person you’re working for cares about you,” Champion says. “I got fired and people followed me here because they knew they might be next on the list. That is the difference. We care about each other as family. The nationals cannot—nothing against them—they are just too big. The president of Liken did not know I got fired, or that the job was my life and I had grown up there. It didn’t matter.”

But it does matter, especially when it comes to patients, according to Champion.

“Because we care about each other here, our people are happy and care more about their patients,” she says.

Fostering a sense of family and patient connection at DeFelice Care goes beyond feel-good platitudes, however. In dealing with the daily tasks at hand, communication and education receive top priority.

This fall, employees began “attending” MED University, an array of online courses offered by MED Group that covers various industry disciplines. “For a small company, we have always placed a high degree of importance on education,” DeFelice says.

On the communication front, the company believes strongly in holding weekly, somewhat unconventional meetings for each business area, such as clinical, reimbursement, and marketing. Led by employees, not managers, the meetings are forums for discussing any issues, concerns, or problems. More to the point, the meetings are about finding solutions, DeFelice says.

“You have got to meet on a regular basis to address questions, concerns, provide solutions. We try to promote here that everyone is self-managed, that you think and make decisions on your own.”

By encouraging independence, DeFelice Care frees its staff to trust their instincts and common sense. And that almost always results in good things for the patient.

“We are succeeding because we are addressing the patient’s need as opposed to some larger competitors who have made it quite clear in the referral community that they do not want patients with the absence of certain diagnoses,” Westcoat says. “I want to get paid for every procedure, but we might have patients we cannot qualify under Medicare’s stipulations, but a doctor wants it for them. We are willing to work with people and come up with a viable solution to their problems. If we are not going to get paid on a hospital bed the doctor ordered, we might do it anyway, knowing that we are going to get paid for a liquid oxygen base.

“Our margins and profitability probably are not going to be as high as some others, but we can still get growth and build this up to something that can sustain those margins.”

It is unconventional thinking, to be sure; but maybe that is why it is working so well for DeFelice Care. “The nationals have their stockholders and they can’t put the patient first,” Champion says. “We send therapists out to every patient to talk about their concerns and reeducate them on their equipment. We are going to know if Mrs Smith is not using her equipment, and we are going to show her how or pick it up; we are not going to continue to bill the insurance. When you are local, you have to care about Mrs Smith.”

Aaron R. Smith is a contributing writer for Dealer/Provider.