Is there an opportunity to be successful with a DME Company?

Meeting the needs of a growing population that needs durable medical equipment (DME) is challenging and the aging population is only getting larger. In fact, it is estimated that in the United States alone, 10,000 people are turning 65 each day!

The current state of DME businesses

There are a lot of curve balls being thrown at the DME business, that makes it a bit more difficult of a time to be in the business. Currently, there are difficulties with Medicare billing and with lower payments that are driving many current DME suppliers out of the game. Patients end up paying out of pocket instead.

Additionally, The Patient Protection and Affordable Care Act, signed into U.S. law by President Barack Obama in March of 2010, has lowered the reimbursement paid to DME providers.

Lastly, there will always be the need for continual education for staff and physicians. Staying current with the latest products and trends will allow a pharmacy to operate more effectively and service the market accordingly.

Is there still an opportunity for DME?

To be fair, the opportunity to run a successful DME business includes a steep learning curve. However, it is not hopeless. In fact, even with all the aforementioned issues, the U.S. DME market is competitive, large and growing. Independent pharmacies can be profitable in this industry.

In 2015, the DME market was worth $46.5 billion. That number is anticipated to grow up to $60.2 billion this year.

How can I run a successful DME business?

The demand is still out there if you desire to run a successful DME business. There are many keys you must use in order to be successful and profitable.

• Network: Successful DME businesses have a good working relationship with a network of referral sources. This includes doctors, nurses, hospitals and nursing homes. Since many senior citizens and the handicapped are likely to be on fixed incomes, working to gain contracts with private insurance companies and Medicaid can create more opportunities.
• Visibility: Your pharmacy should have an area to display those products you are pushing. It should be noticeable and inviting. A lot of time and effort should go into this production. You can also consider hosting an education seminar if you have the space. It is an opportunity to bring in new people to the store. You can host topics such as diabetes or even find a Medicare agent to discuss Medicare topics.
• Staffing: Having your business properly staffed is the key to success for nearly any business. You want all your bases covered, like staff to handle the billing and staff to cover areas such as certified members to fit diabetic shoes and employees available for delivery and setup. Successful team members will also have access to continued education to ensure they are up to date on all changes and news within the industry.
• Training: It isn’t just your staff that needs proper training, it is the physicians that also need to know how things in the DME world work. Insurance providers can be finicky about their paperwork and for good reason. If physicians do not keep close eye on their orders, things can get pretty ugly. A way to minimize these problems and build your relationships with the physicians is to host a lunch and learn event or to send educational faxes to the clinician’s office. Creating an environment where a physician has an easy time sending DME orders with proper documentation to your pharmacy is key to your business’s success.
• Knowledgeable: Staying up to date on all things DME is just as important as staying up to date on all the trends. The trends on what people are looking for and which products to keep or nix is important to know. For example, some continuous blood glucose monitors will now qualify as DME as stated recently by the Centers for Medicare & Medicaid Services.
• Make it flow: Billing software is going to be another key component to keep your DME business flowing. Huge challenges that face all DME practices include frequent audits, delayed reimbursement and lower payments. With great billing software, these challenges become much less of a hassle.

Bottom Line

There is no doubt that running a successful DME company is challenging. You can relax knowing that the opportunity is definitely out there. However, with the opportunity to make a profit comes a steep learning curve that involves some networking, staffing, training, visibility and the research to know which products to offer. It will take some time, energy and effort to get things set up just right, but it can be done.