Flip phone anyone?


Allow me to take you back to your first flip phone.  Remember how awesome it was, sexy, cool and high tech.  You were stylin’ and current, and you probably had a skip in your step.  Times change.  Seventeen years later, there are very few flip phones still in the USA.  Thanks, Apple.

Another hot item in Y2K was the oxygen concentrator accompanied with portable tanks.  OK, it wasn’t really a hot item, but it was dominant in the market.  In 2017, Inogen is going to sell about 45,000 portable oxygen concentrators (POCs) for cash through its direct-to-consumer channel.  POCs, theirs and many others like it, are dramatically superior for the user versus the alternatives.  Most people on oxygen are not offered a POC and don’t know the existence of the technology.  Despite that, POCs are approaching 10 percent market share and are the fastest-growing segment of oxygen therapy.  There are several lessons therein that should not be lost as you move into 2018.

  1. Be exceptionally good at your core. You don’t sell 45,000 POCs for cash in 2017 without being exceptionally good at it.  At its core, being “exceptional” is about disciplined and proven processes, methods and execution.  Whatever your core may be, that is where you must be exceptionally good.  The rest can be outsourced.
  2. Compelling products that solve problems move the needle. There have been many innovative new products launched and new technologies unveiled in recent years that impact your market and your customer base.  But, usually it is easier and safer (short term) to hang onto the base and cling to what you know.  Compelling products that are better for the customer have great power to drive your business.  A little scouting and you’ll be able to find several that fit your business.
  3. Patient-centricity matters. Health care has traditionally been physician-centric, not patient-centric.  Patient-centricity is a mindset and one that health care providers would be wise to adopt.  Offering POCs direct to the consumer was abnormal when it began in 2009.  But, thinking about the patient and how to meet their desires in the best way possible, patient-centricity, led to a successful direct-to-consumer model for POCs.  There are many similar opportunities in our market yet untapped.  To find them we must think beyond just want the doctor ordered to thinking about what can give the user a higher quality of life.
  4. Patient-pay is an exciting market. It’s good to be on the right side of mega-trends.  Patient pay in health care is a huge growth area over the next decade.  Those with the means will reach into their own pocket for a superior solution.  The POC, the stand-up wheelchair, the tool that eases pain are a few of many possible examples.  To capitalize you must offer the solution to your customer, and you must be adept in articulating the benefits and have the courage to ask for the sale.  And, please avoid the “they don’t have the money” mindset, after all they aren’t carrying a flip phone, are they?
  5. “New” should be part of your plan. A minimum of 5% of your annual revenues should come from “new.”  “New” can be new products or categories or referral sources or channels or payers.  You must regularly introduce new revenues into the business or it is likely to atrophy.

The HME space will grow significantly over the next five years.  Unit volumes vary among categories, but 7-10 percent growth in unit volume is a fair expectation.  Those rates of unit growth represent an extremely attractive market.  Serious problems will remain, notably continued compression of reimbursement, particularly for commodity items; narrowing participation panels brought on by payer consolidation; and non-traditional competition.  Every market has its challenges.  Selling flip phones in the U.S., as an example, certainly has its limitations. On the whole, HME remains a very compelling place to be.

Let the Decision-Maker Drive Your Approach to the Market

centric chartMost post-acute healthcare business, including home medical equipment, grew up as a physician-centric business model.  The physician, or another party who is essentially an extension of the doc, is at the center, the decision maker.  The doc, or designee(s), chooses the therapy, the supplier, and, often the specific item.  That model still controls over half the market and that market segment will experience strong unit growth over the next two decades, in virtually every category.  This model requires winning at the doctor level, through relationships, convenience to the doc, speed, clinical competence or service.

Another major segment is the payer-centric model.  This model has the payer as the primary decision-maker.  The payer selects, sometimes through rules and sometimes indirectly, the therapy, the supplier and the price.  This area is growing more rapidly as payers seek solutions to the problems they face.  Pricing is always a priority issue with the payer, but they also care about performance outcomes, IT security, coverage capacity and data.  Most suppliers are aware of the growth of this model, but don’t like it and are not doing much to play in this space.

The third broad segment is the patient-centric model.  The patient is the decision maker, electing to do, or not do, based on their own perspectives and well-being.  This is also a significant market segment and it has a high growth rate.  Succeeding in a direct-to-patient model requires messaging directly to the consumer as well as crafting the offering around the things that matter to him or her.  Some suppliers are “all-in” in this space, most others only have their toe in the water.  The patient-centric model in HME was really born by Scooter Store 25 years ago.  Inogen, cpap.com, Zyppah and CPAP Mini are some of the most aggressive patient-centric players today.  If you have not noticed the ad spending by these folks you’re living in a cave.  Google ad-words, talk radio and satellite radio are three spots where these suppliers are spending millions to reach the consumer directly, circumventing traditional physician control and payer control.  Pharmaceuticals are another area where direct-to-consumer has come into prominence over the past decade.  Drug companies spend $7 billion a year in the US on direct-to-consumer advertising for prescription drugs.  Be clear – the direct-to-consumer model is working extremely well in healthcare.  The consumer wants a better quality of life.  They want to feel better or feel less pain.  They want comfort.  They want better options.   And they want an easy and convenient way to access the product.  None of these things are important to the physician – and as a result many providers who were built on physician-centric model are really not meeting the wants of the consumer.

Each of these three models present tremendous opportunities, but growth rates vary.  Each requires a distinct approach to be successful.  Healthcare providers must understand and then meet the needs of the particular decision maker at the center.  Resources must be aligned in a way that optimizes your ability to succeed in the channel in which you are seeking to compete.  Recognize that those things that are most important to each of the three decision makers – doctor, payer, and patient – are often different and your approach must be focused on the priorities of your target.

Government Run Healthcare

Amid much discussion about healthcare and potential reform, the conversation often leads to the federal government’s role. It is worth considering the track record of federal health programs prior to deciding to hand over the entire healthcare system.  Our federal government currently commands four major realms of healthcare programs:  Medicare, Medicaid, Veterans Administration and Indian Health.

  • The VA health system is an abject disaster. Nine million veterans, those who served their country often at great cost, have been largely relegated to a scrap heap of substandard healthcare.   Centralized federal planning and bureaucratic fiefdoms have created a very illogical structure, low quality and a patient experience on par with Soviet-era food rationing.
  • Indian Health Services can best be described as sad – just ask any of the 3 million people “served” by it. Indian healthcare meets most third world health standards, and little more.  This is what happens when federal control triangulates with minimalistic funding and a recipient population with no voice.  Any “have nots” who think single-payer is the answer for them should take a look at Indian Health.
  • Medicaid functions well in many regards. Individual states work in compliance with federally directed parameters to provide health coverage to low income people.  The single biggest impact of Obamacare is that about 15 million people were added to Medicaid under its provisions, most of whom previously lacked coverage.  Interestingly, the majority of state governments opt to outsource the administration of Medicaid to large insurance companies like United Health Group.  The insurers (outsourcers), who are attuned to more sophisticated cost control than the government is, often ration healthcare through inconvenience in these outsourced Medicaid programs.  Said another way, they must follow government rules that generally purport to cover everything, but given funding limits, the outsourcers are left to pare back coverage by making it difficult to access.  So tricks like denying people who can’t walk access to a wheelchair via mountains of paperwork required or making a person place three calls and wait six weeks for an MRI, lead to peeling off 20% of the “demand” for healthcare.  It’s not a terrible system, it’s just not the type of coverage and treatment most of us are accustomed to with employer based health insurance.
  • Medicare is the immensely popular healthcare program for seniors. What’s not to love?  It is the Cadillac of health plans – very low out-of-pocket costs for participants, virtually no restrictions on coverage, broad networks of hospitals and physicians and little responsibility directed toward participants.  Medicare does place stringent cost controls on the fringes – homecare, non-physician healthcare, ER as examples – while placing virtually no controls over the huge costs of pharmaceuticals, procedure-based physicians and end of life healthcare expenditures.  Interestingly, the stakeholders with the most money get the least restrictive governance by Medicare – hmmmm.  For those who ask, “why can’t we all just be on Medicare or a Medicare like system?” the answer is that we can’t afford it.  It would significantly increase the cost of our healthcare system.  Medicare’s annual net cost to cover a beneficiary is three times that of private insurance.  Given the age discrepancies in the coverage pools, it is difficult to compare the two.  But, in the past ten years, when cost containment has become particularly important, Medicare has increased annual per beneficiary costs by $4,300 per person while private insurance has increased per person costs by only $2,000.  Additionally, single payer would likely take significant employer contributions and innovations out of the mix.  Further, it is worth noting that technology advances have driven costs out of most industries over the past two decades.  Healthcare, however, still utilizes many therapies, technologies and approaches which are twenty to sixty years old.  Medicare has done a very poor job in its role as an accelerant of innovation and technology in healthcare.

So while there are many aspects of single payer that are attractive, the government’s record of running healthcare programs is just not very good.  Buyer beware.

The Magic in Patient Experience

helping elderlyIn high school I worked in a grocery store.  One day I was bagging groceries, my first week, and the store manager came down out of his office, pulled me aside, put his arm around me and pointed to a lady walking out of the store.  “You see that lady?”  He said, “She’s got your paycheck in her purse.”

As a dumb 16 year-old I wondered why they gave my check to that lady I didn’t even know?  My Manager went on to explain that the lady could just as easily buy her groceries in other stores.   Greeting each customer, being friendly and helpful and thanking customers kept people coming to our store.  If they didn’t come back, he explained, there would be no work for me (us) and no paycheck.  I was fortunate to have that lesson stick with me.

A more recent boss taught me another important lesson.  Van Miller always made a point of telling us all, “Have Fun!”  Van liked to have a good time, so it would be easy to miss the point of Van’s “Have Fun” instruction.  While I know he did want us to have fun, his real desire was that each of our guests (customers) had the kind of experience which made a positive impact on them and which they remembered long after an encounter or event ended.  Van knew that customers like to be around people who are friendly and who are having fun – smiling, laughing, talking, welcoming, toasting and dancing.  It’s a very important part of creating an impactful experience.

The consumerization of healthcare is bringing patient experience into the forefront.  Patient experience will become the primary driver of winning business over the next few years.  The sad fact is that most healthcare providers – of all stripes – provide a really poor, or at best generic, customer experience.  Most healthcare folks are just not wired that way.  We have not been required to put the patient in the center of our world.  Patient experience includes the quality of care, explaining the therapy or treatment, exhibiting a sense of urgency and physical attributes of our care delivery setting.   But the centerpiece of patient experience is the individuals with whom the patient actually interacts.  Smiling, extending a hand, listening, solving a small problem, offering a caring ear, friendliness and creating a sense of inclusion are the things that will make a great patient experience.  Sure, curing their cancer is more important, but the fact is that doesn’t happen in very many patient encounters.

Each patient, in some way, has your paycheck in their purse or pocket.  They are our valued patients and friends, so treat them to an experience that leaves a lasting impression, including offering a smile and having a little fun!

Medical Equipment Industry Under Siege

chairHeartland 2017 is in the books.  It was another amazing experience in Waterloo.  More than five hundred home medical equipment providers spent several days learning, exploring new ideas, getting better at what they do, considering alternative methods, honing skills, networking, seeking best practices and having some fun.  We had the support of nearly 100 exceptional vendors who had innovative and compelling equipment and services to offer.  We also had the support of 75 great speakers and teachers to push the envelope and inspire us.  A state of the art Retail Training Lab was one extra special feature of this year’s Heartland.

But as the picture above shows, we had a couple empty chairs.  And that hurts.  Don’t get me wrong, attendance was excellent, which was a comfort given the challenging times facing the HME industry.  But some great people were not here.  Let me name two.  Thad Connally and Chuck Vetsch have been at most, if not all the past Heartlands.  Thad is one of our industries most strident advocates.  Chuck has gone above and beyond to meet the complex healthcare needs of people in rural Washington state.  These are two of the best men, and best friends, a person could have the privilege to know.  They are the first to extend a hand of help to anyone who might need it.  They were missed at Heartland 2017.  They stayed home, impacted by draconian cutbacks in reimbursement, to serve patients and operate their businesses.

Bad federal healthcare policy – developed and implemented by both elected officials and unelected bureaucrats – has had a huge negative impact on the home medical equipment industry.   In the past five years, 40% of all home medical equipment providers have disappeared from the cities and towns across America.  That’s 6,500 businesses gone.  In several states more than half of all healthcare equipment suppliers have disappeared as a direct result of horrible federal policy.  This forced consolidation and liquidation of an industry has had a hugely negative effect on tens of thousands of people who provide healthcare to our frail elderly and disabled populations.  Perhaps more importantly, it has had significant negative effects on several million people who rely on medical equipment, supplies and assistive technology to maintain a decent quality of life.  These frail elderly and disabled folks have far less access to healthcare than they had five years ago.  Fewer people are able to benefit from advanced home medical technologies.  Thousands have faced significant inconvenience of trying to coordinate care delivery through multiple suppliers.  Many people are being held in the hospital extra days awaiting medical equipment in their homes.  Quality of life has suffered.  Our elected officials in Washington must act and they must do it soon.  Failure to correct their mistakes will lead to even more severe deterioration of the home healthcare infrastructure in America.




Wheelchair Image

I offer my list of events in the timeline of wheelchair development, the acceptance of people in chairs and key milestones which forged people’s perceptions of wheelchairs and the people who use them.  Please join in the conversation – what’s on your list?

Image of Wheelchair Ramp

#1. Americans with Disabilities Act.

In 1990, Congress passed the comprehensive civil rights law addressing the rights of people with disabilities.  The ADA prohibits discrimination based on disability and requires reasonable accommodation to the disabled.  The original bill was introduced in the Senate by Iowa’s Tom Harkin and was signed into law by President George H.W. Bush.  The ADA has had a profound impact on workplaces, schools and public spaces – but not without controversy.  In the big picture, the ADA has brought millions with disabilities out of the shadows and into the mainstream leading to much higher quality of life for those with disabilities and a richer life experience for all.

Image of boy in wheelchair

#2. Superman in a wheelchair?

In 1995, actor Christopher Reeve, best known for his role as Superman, was paralyzed in a horse-related accident.  Reeve was a quadriplegic.  His fame and his determination to advocate for those who required the use of a wheelchair brought tremendous visibility to the cause.  In particular, Reeve’s efforts revealed the importance of complex rehab technology used in wheelchairs and the way it enabled users to pursue a high quality of life despite being confined to a wheelchair.

Image of couple in wheelchair

#3. Marilyn Hamilton and the Quickie Wheelchair.

In 1979, Marilyn Hamilton and two partners launched the Quickie wheelchair, a revolution in lightweight and fashion-forward chairs. Due to a hang-gliding accident, Hamilton became a T-12 paraplegic, but wasn’t willing to surrender her active lifestyle to partial paralysis. This Quickie chair was designed with an active lifestyle in mind but also, for the first time in a wheelchair, introduced a focus on design and visual appeal, in addition to enhanced freedom and movement. The Quickie represented wheelchairs and wheelchair users going on the offensive against paralysis – living an active, quality life regardless of any limitations. All the elements of the Quickie would be enhanced over time, but it was Hamilton’s vision that ignited a very big change.

Image of Student in wheelchair

#4. Judy Heumann overcomes bias and adversity to teach school.

Our Country’s treatment of people with disabilities has come a long way since Judy Heumann was forced out of school in the 1950’s. Her crime? She was confined to a wheelchair. With the help of persistent and dedicated parents, Judy got an education, graduated from college and qualified to become a teacher. She was very bright, articulate and caring. But the Board of Education refused to grant her a license to teach school because she had the audacity to be confined to a wheelchair. Her struggle ignited a passion to fight for the rights of people with disabilities and her efforts were instrumental in creation of two landmark laws, the Individuals with Disabilities Education Act (1975) and the Americans with Disabilities Act (1990). Today, people would not imagine this blatant discrimination, but in that era it was commonplace, which is why her battle to overcome it is in my top 10.

Person in wheelchair playing tennis

#5. Wheelchair developments make life more accessible

The ability to fully participate in the regular activities of life may be the holy grail for wheelchair users.  Recent engineering and technology advances have opened up the world to people using wheelchairs in a way that was never before possible.  One of the best examples is the standing powerchair, a product greatly enhanced and mainstreamed in recent years by Permobil.   Standing chairs offer clear health benefits such as pressure relief, advantages in bowel control and respiratory function.  But perhaps more importantly, standing and moving are life-changing.  Standing allows reach, function and social interaction which removes many barriers and equalizes in a way not before available to a wide range of wheelchair users.

Image of US Capitol

#6. Reduction in Reimbursement

Around the dawn of this century, Congress and bureaucrats from Medicare began a fifteen year run of reducing Medicare and insurance reimbursement for wheelchairs. This took various forms, including many steps to restrict access to wheelchairs and power mobility equipment and to reduce the amounts paid for wheelchairs. The effects of this multi-pronged effort was a reduction in the curve of innovation, a downgrading of the equipment available to wheelchair users and significant reduction in the number of people able to improve quality of life through wheelchair products. Some of this policy change was driven by a dramatic escalation in direct to consumer advertising which, on the positive side, made millions of people aware of how wheelchair technology could enhance their quality of life, but many payers and regulators took a negative view of the significant increase in the number of people using such medical devices. Bizarrely, Medicare, by policy, covers power wheelchairs used “inside the home” only. Policies created by the bureaucrats at Medicare don’t have to make sense, and often don’t.

Mobile Wheelchair Image

#7. Invacare’s First Power Wheelchair.

Invacare, led by maverick Mal Mixon, launched its first power wheelchair (the Rolls Arrow) into the marketplace in 1983. The chair was user-centric and was equipped with electronics, which were advanced for the time. That chair was the first of many advancements in power chairs brought to the market. More and better chairs would come, but this one spurred the market, drove innovation and led to a much greater focus on the needs of the wheelchair user.

Vote Buttons Image

#8. The 2016 U.S. Senate election in Illinois.

This contested election was between two candidates who are physically disabled, both of whom regularly use a wheelchair. Tammy Duckworth lost both her legs and partial use of her right arm in the line of duty after a helicopter she was piloting was shot down in Iraq in 2004. Mark Kirk, the incumbent Senator, suffered a massive stroke in 2012 leaving his left side partially paralyzed. Both candidates, understandably, downplayed the presence of their disabilities. Nonetheless, it is impossible to deny the historic nature of this race. Duckworth won the election and now represents Illinois in the US Senate.

image of couple in mall shopping

#9. The use of wheelchairs becomes “acceptable” in Popular Culture.

Pop culture is often a signal of changing societal norms and conventional wisdom. In the decade beginning in 2006, there was an emergence of people with disabilities, specifically those using a wheelchair, in our pop culture. A few of the key inflection points were:

* The hit TV show, Glee, which prominently featured a character in a chair.

* American Girl actively marketing a wheelchair accessory in its doll line as well as the first of its doll girls who had a disability.

* Barbie launching a wheelchair accessory.

* The ABC show Speechless, in which one of the characters uses a power chair and assistive speech technol

Presidential - Wheelchair Image

#10. Woodrow Wilson is first US President to rely on a wheelchair.

Wilson was a visionary president who ended the First World War and set in place strategic and diplomatic measures, which ultimately led to sustained peace and prosperity across the globe. Deteriorating health in the latter part of his presidency resulted in Wilson’s reliance on a wheelchair. Both the norms of the era and the limitations on media allowed his wheelchair usage to be largely concealed from the public. A protégé of Wilson’s would later become President and he also required a wheelchair for mobility. Franklin Roosevelt, like Wilson, concealed his wheelchair usage. The longer-term impact of Roosevelt was an acknowledgement and acceptance of people in wheelchairs – but it started with Wilson.

Image of woman in wheelchair with daughter

#11. Jeff Minnebraker builds the first ultra-lightweight wheelchair.

In 1975 Minnebraker built a chair to specifically fit his body, disability and lifestyle. In the 1970’s and early 1980’s, University of California-Berkeley was the hub of an independent living movement. People with mobility disabilities leveraged that hub to integrate into a community. Minnebraker’s Berkeley Power Chair emerged from that community. It never became a commercially available product, but it was an important breakthrough establishing means to meet the needs of the wheelchair bound person demanding an increasing level of independence.

Couple in wheelchair hugging

12. Color in wheelchairs

Color has nothing to do with function, so why would it be a top 12 development in wheelchairs?  For people who rely on a wheelchair to get around, the chair is their car, their desk and their house in many ways.  It’s the place they spend most of their time.  And it’s a first impression.  Just as Steve Jobs brought color to the computer, which then led to advances in style, color in wheelchairs has done the same.  This is especially important for children confined to a wheelchair.  We all have an innate need to belong, and in this context color can help.


Forced Consolidation Damaging Healthcare

Image of Elderly person's hands on cane

Flawed federal government policies are forcing a dramatic consolidation of healthcare providers across the nation.  This consolidation is greatly reducing competition among providers, reducing patient choice and severely limiting patient access to needed healthcare.  The most significant consolidation is occurring in homecare and home medical equipment, where government policies have been particularly aggressive in forcing consolidation.


In the past three and a half years, the number of home medical equipment suppliers and the number of locations has declined by 38%.  This is a staggering downsizing of suppliers in any environment.  This consolidation is even more egregious when considered in the context of a growing population of seniors brought on by the aging of the baby boom generation. The frail elderly and the disabled are the populations which rely upon home medical equipment suppliers to maintain quality of life.  Consolidation is occurring across the healthcare continuum.  Over the past five years, hospital system consolidation has occurred at higher rate than in any other five year period in history.  Over the three year period from 2012 to 2015, 12% of all physicians in the US went from an independent practice to being employed by a health system.  That’s 46,000 docs consolidating into health systems in just three years.

Drilling deeper into the home medical equipment consolidation provides a clear correlation between federal policy on the inaccurately named competitive bidding and consolidation.  In the 10 most populous states, where competitive bidding is focused, there was a 47% reduction in the number of HME suppliers over three and a half years.  In the fifteen lowest population states, where competitive bidding was largely absent, there was an 18% reduction in suppliers over the same period.  That tells us that a combination of federal policy changes and economic realities caused a significant consolidation, 18%, in home medical equipment suppliers.  But further, competitive bidding alone, the most deeply flawed of policies, caused a consolidation of nearly 30% of supplier in impacted areas.  And to be clear, that’s a consolidation over a very short window of 42 months.

Consider this, New Jersey, California, New York, Illinois and Connecticut each lost over half of their HME locations in just 42 months.  In the 15 least populated states, more than 200 HME business locations have shuttered in this same short period.  That means over 200 rural communities lost their access to a medical equipment supplier.

Competition is good for the consumer, it gives them choice and it forces competitors to provide exactly the things consumers want in order to win their trust and their business.  Consolidation eliminates competition and eliminates patient choice.  It has robbed patients of local access as many communities that once had access to providers no longer have that local access.  We must all advocate for reversal of federal and state policies which force consolidation and harm providers and patients.

Store locations LOST in just 42 months

Large States

California                  734
New York                  656
Texas                          493
Florida                       387
New Jersey               288
Illinois                       392


Tennessee                169
Alabama                    58
Mississippi                54
Arkansas                    55
Georgia                      291
South Carolina         84
North Carolina         29
Virginia                       115

Industrial Midwest

Michigan                    236
Ohio                            262
Wisconsin                  76
Indiana                       95
Minnesota                76
Iowa                            45

Great Plains

Nebraska                   28
Kansas                        59
South Dakota           9
North Dakota           3

Pacific Northwest

Washington              69
Oregon                       56
Idaho                          24
Montana                   15