Successful HME companies understand that the future depends on continued growth, performance, and profitability. By reviewing and improving operational performance, companies can increase overall effectiveness and improve profitability. Start with an internal evaluation and assessment. Identify where you are, where you have been, and where you need to go to improve performance. Conduct a diagnosis before performing the “surgery” or the organization may get sicker. The objective is to turn weaknesses into areas of strength and profitability. When the sleep market began to take off last year, we strengthened our clinical capabilities by hiring a full-time respiratory therapist who boosted referrals to help us expand our respiratory niche.

Overall, the HME industry has seen a decrease in payments from third-party payors that ultimately affects profitability. The mandate to operate at an optimal performance level and meet financial and organizational expectations is changing the way HME companies perform.

Key questions revolve around operational performance. How are you doing business and how can you do it better? What processes affect service and performance? Are you performing at peak efficiency and peak performance? If not, can you change?

The Joint Commission on Accreditation of Healthcare Organizations recognizes this discipline referred to as “Improving Operational Performance (IOP).” IOP is a critical component of the Joint Commission process. But how and where should you improve operational performance?

An organization can adopt any number of ways to improve efficiency and performance. There are many improvement concepts such as total quality management, continuous quality improvement, root cause analysis, and IOP.

Our Style
Our organization’s style of leadership is “management by consensus.” This basically means all major decisions are reviewed and decided on in a group setting. The planning process is an excellent tool to ensure that key personnel assist in formulating the improvement approach. This approach creates greater opportunity for the staff to have buy-in and support the chosen plan of action.

The first step is to identify business processes that affect company performance. The next step is to identify business processes that are weak and not achieving performance or expectations. A final review allows you to determine if the business process should be eliminated, continued, or modified. If management decides to continue, create a project team. This team should focus on reviewing the entire business process and make improved changes where needed.

Start Searching
Typical areas of concern in an HME company:

• Service deliveries
• Lost work orders
• Billing and collections
• Patient satisfaction
• Maintaining inventory
• Employee training
• Sales performance
• CMNs (certificates of medical necessity)

We created a “business performance report card” that allows management and the staff to rate performance on the basis of 1 to 100, with 100 being a perfect score. We scored each category listed above. These areas were identified as critical due to the fact that they affect efficiency and performance. We focused on areas of concern that did not score or rate 90 or higher.

In many organizations, companies have scaled back in operations and resources to sustain operations. Many organizations continue to do more work with less staff and resources. This is all the more reason to improve operational performance. Start the IOP action plan by:

•Evaluating current business processes and performances.
•Assessing current outcomes of these business processes.
•Developing new business processes with the intent of making improvements.
•Training all staff on the correct implementation of these changes.
•Monitoring new business processes to ensure proper understanding and implementation.

Real world priorities
1) Perform deliveries correctly the first time (delivering a hospital bed that works on initial setup). If the company delivers a hospital bed and the bed is not working correctly the bed will have to be redelivered. Any time a delivery has to be done twice, profits take a hit.

2) Billing insurance claims correctly the first time is a time-saver and keeps cash flowing. If the process takes months to collect, profitability of the company may become affected.)

3) Increase revenue through improved customer service. Every company must thoroughly understand that the patient is not the source of our problems, but the reason we exist.

4) Outcomes management is your business tool. High performance scores should be the ultimate grade card that drives our performance. Another critical aspect of IOP is “celebrating success!” It is important to celebrate once the new business process has been properly implemented and is working. Nothing works better than the smell of sweet success.

Success Through Change
The HME industry may be characterized as dynamic, uncertain, complex, or even volatile. HME markets have become more and more competitive. There are more HME organizations than ever before. Due to these facts, there has never been a more important time to reshape the workplace. The process should be slow, yet deliberate.

Companies that establish challenging action plans and work effectively with their staff to achieve them create high-performance workplaces. Hopefully, these work environments are characterized by innovation, creativity, service, and a continuous improvement mind-set. IOP was once just a Joint Commission protocol, but in reality, it has become a powerful tool for survival needed by every successful organization.

Richard Hernandez is president of Med Mart, San Antonio. Med Mart is a full-service, JCAHO-accredited provider. Med Mart employs a full-time respiratory therapist to handle its burgeoning sleep therapy/respiratory business. Hernandez can be reached via email: mpmi2003@hotmail.com.

Respiratory Insider

Steve Bordewick Before founding Minneapolis-based AEIOMed, CEO Steve Bordewick spent several years developing implantable defibrillators. “In that world, you absolutely have to be thinking small at every turn in the design process,” he says. “That is what I instilled in the team working on [AEIOMed’s] CPAP unit, and that is how we were able to succeed.” Dealer/Provider spoke with Bordewick to find out more about his company. Q With so many CPAP units already available, what inspired AEIOMed to enter the CPAP market? A With so many patients dropping out or underutilizing the therapy, there clearly is a need for improvements in these products across the board, especially in the patient interface. Just about every new interface gets a lot of interest, and that would not be the case if needs were being met already. The same has not been true for the CPAP unit itself, although there is still a need to make that part of the system more friendly to the patients. While a lot of work has been done on modifying the way the CPAP unit delivers the therapy, we at AEIOMed heard more of a need from the patient, dealer, and clinician populations for improving aspects such as size, portability, battery operation, and elegant integration of the heated humidifier. These came across to us as more important to patient acceptance and satisfaction than adjustments to the pressure management. So, that is what we focused on for CPAP. Q How will providers and patients benefit from AEIOMed products? A While most view CPAP therapy systems as consisting of two elements, the CPAP unit and the mask, we viewed it as three elements, the CPAP unit, the interface subsystem, and the Headrest™ subsystem. By understanding this breakdown, we believe that providers and patients ultimately will win because our system will make more sense to them. As we grow as a company, this unique approach to looking at each product challenge in a new light will provide a long-term benefit to providers and patients, because we have a lot of exciting things to do for products yet to come. If we can raise the bar for all manufacturers in this industry, providers and patients will no longer be held captive to the relatively stagnant product innovation they have experienced in the past. Q How do you see the sleep therapy market changing in the future? A This is a fantastic market for passionate product innovators. For something so fundamental to a patient’s health and well-being as sleep, you can’t ask for a much more rewarding area to focus your attention, and this will lead to exciting innovations since it will draw the best of the best in product developers. The advent of positive pressure therapy being used in the congestive heart failure and stroke markets will likely provide some side benefit to the sleep therapy market because so much attention is being paid to better understanding the mechanics of the therapy.