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Feasibility Of Durable Medical Equipment

durable-medical-equipment: Durable Medical EquipmentFocus and Framing

Overview Community Health Systems, Inc. is a nonprofit healthcare organization that is committed to providing comprehensive primary health care to citizens of southern West Virginia. the organization was established in 1967 as a demonstration health care project. the organization first was established in leased space from a local nonprofit hospital in Beckley, West Virginia. The organization then moved its corporate office in 1977 to 252 Rural Acres Drive in Beckley, West Virginia and operates from that location today. The company has grown over the years and has 9 locations, 33 providers, and over 150 employees Of the 9 locations, the majority are in the Beckley area and the others are in close proximity. The following clinics are located in Beckley, West Virginia: Rural Acres Clinic, Carriage Drive Clinic, Access Health Stanford, CHS Associates, and CHS Professional Medical Ultrasonic's. The remaining locations are Glade Crest Clinic in Daniels, WV, Clear Fork Clinic in Colcord, WV, Marsh Fork Clinic in Arnett, WV, and Glen Rogers/Ravencliff Clinic in Ravencliff, WV. The organization offers primary health care services including:

1. Family Practice

2. Pediatrics

3. Internal Medicine

4. OB/GYN

5. Ultrasonic's

6. Laboratory

7. Pharmacy

8. Billing

9. Administrative

The pharmacy is a 340(b) provider of prescription drugs. This means that the pharmacy provides customers the lowest possible price on prescription drugs at the same rate the federal government is allowed to purchase the products. According to Charles Hunt CEO of the organization, in 2005, Community Health Systems, Inc rendered services to 34, 998 users accounting for 112, 467 patient encounters (C. Hunt, personal communication, May 28, 2006). Community Health Systems, Inc. insurance and programs offered to customers are Medicaid, Family Planning, Cancer Control, Children's Health Insurance Program, Medicare, United Mine Workers Association, Sliding Fee Scale, Patient in Need, and Discounted Pharmaceuticals.

Issues The idea for this project was introduced by the Pharmacy Director in a management team meeting. Because of the potential revenue, the Chief Executive Officer asked the facilitator to explore the potential of carrying durable medical products. The facilitator was responsible for gathering information on Durable Medical Equipment and determining financial projections so the management team could decide the direction they want to take on the issue. Durable Medical Equipment is described as wheelchairs, crutches, wrist splints, gauze, needles, and other types of supplies.

Context and Stakeholders First, the organization is established as a Federally Qualified Health Center that receives a grant from the Department of Health and Human Resources in the amount of $1.6 million dollars every April 1st. The grant allows the organization to provide healthcare services to low income people based on a sliding scale fee in relation to their monthly income. Second, the providers that are employed by the organization are not responsible for medical malpractice insurance because they are covered by the Federal Tort Coverage Act. The government covers all lawsuits in relation to receiving medical care at any of the nine locations that Community Health Systems, Inc. operates.

One of the stakeholders of the organization is the government. It provides grant money to offer healthcare to the underserved population. Second, citizens that need healthcare are stakeholders because of the many different payment plans that are available based on household income. Third, employees of the organization may benefit from this research because they help the organization carry out the mission and the vision. The last stakeholder of the organization is the community in which the company operates because it brings low-cost healthcare and jobs.

Affecting Issues Organizations that are affected by the issues are other local Durable Medical Equipment businesses within the location that Community Health Systems, Inc operates. Patient services are also affected by the issues because their care is controlled within the Community Health Systems, Inc. frame of business and their providers are writing prescriptions to an entity of this organization if the management team decides to move forward with pursuing the durable medical equipment market. The organization's strategic plan is affected because this is a market that has never been in discussion as a future service of the organization.

Purpose The purpose of this research is to determine the feasibility of expanding services into the durable equipment market.

Significance The information gave the management team of Community Health Systems, Inc. a broad overview of the potential or exclusion of such a project. The researcher investigated all possible revenue streams related to the durable equipment market. This allowed the Community Health Systems team to see how other organizations operate within this market. The organizational impact of the project had been creating an additional revenue stream for the organization and creating more jobs within the local community.

Content The researcher constructed the following sections of the research; focus and framing, literature review, methodology, constructing accounts, and plan of action. The focus/framing section gave a brief overview of what Community Health Systems, Inc. is made up of in structure. The literature explored what others are saying about the durable equipment market, reimbursement rates, forms, and other policies that are compromised of this particular venture. The methodology section provided a detailed plan in how the research project had been carried out. The constructing accounts section told the stories of the stakeholders and their viewpoints in relation to the study. The plan of action section demonstrates the steps the researcher took in the project based on recommendations from the management team of Community Health Systems, Inc. In the financial section of this project the researcher constructed data based on information gathered from various sources and showed what the potential profit is based on what the insurance carriers pay.

Leadership Model The researcher used the change theory method of leadership in showing others the possibilities of offering durable medical equipment within their established scope of business. Change theory is about motivating others to help the organization with its mission and vision. Servant leadership was a key part of the model because the researcher worked with others and encouraged everyone to be participative and to give feedback. The researcher acted as the project manager and moved the whole research from the start to the finish.

Literature Review

What others say is happening

The Durable Medical Equipment (DME) market has seen dramatic changes year after year and regulations from insurance providers will continue to add new laws to curb abuse and waste. According to Senator Chuck Grassley, "Fraud, waste, and abuse are enemies of the health care system" (Kozeny, 1997, para. 6). Healthcare costs are always rising and it doesn't help when the insurance carriers have to keep strict guidelines for reimbursement because of abuse and fraud. The negative side of the business has pushed Medicare and Medicaid to tighten controls on what equipment they paid for as a result of fraudulent claims by durable medical businesses. Citizens Against Government Waste (1997) gives the following fraud examples as cases against DME providers:

As part of a plea bargain agreement, a Texas DME company paid restitution of $450, 000 and was sentenced to one year probation for supplying wheel chair pads to nursing home patients and then fraudulently billing Medicare for a more expensive lumbar sacral support system.

A Pennsylvania DME company agreed to pay $110, 000 to settle criminal and civil liabilities for submitting false claims to Medicare for marketing and distributing lower-quality body jackets to long-term care facilities than those actually delivered. The company and its president were barred for life from participation in any HHS programs.

A physician fled to the Dominican Republic and his cohort in crime fled to Sierra Leone for preparing and signing fraudulent certificates of medical necessity for DME. A New York judge sentenced the Dominican refugee in absentia to 78 months in prison and ordered him to pay $3.5 million. His partner waived extradition to return to the United States.

A New York DME company used a sham subsidiary to submit claims in Pennsylvania for equipment sold in Western New York. In addition to a criminal fine of $300, 000, the subsidiary also pled guilty and agreed to make full restitution of $1.1 million and to pay a civil penalty of $2.5 million.

These fraudulent schemes of durable medical equipment businesses have contributed to the strict guidelines for reimbursement. Insurance companies also play into the political side of the business in delaying claims for payment because additional information may be needed. These examples show that employees will be required to keep everything documented and organized in case of an audit by an insurance carrier.

Insurance fraud is a continuous battle with durable medical equipment businesses. For example, Senator William Cohen of Maine explained how Medicare beneficiaries are recipients of fraud. He said that a supplier paid $28.57 for a mattress that was supposed to prevent sores and billed Medicare for $1, 132. Medicare paid $943 of the price and the rest was left for the customer to pay (The Intelligencer, 1991, p. c-15).

According to Center for Medicare & Medicaid (1998) they have implemented new guidelines for businesses that operate as a durable medical equipment supplier that states the following requirements:

Under the regulation published today, suppliers of DME (including wheelchairs, canes, and other medical supplies) would be required to obtain surety bonds of at least $50, 000. In addition, the proposed regulation would ban DME supplier telemarketing; require suppliers to have a physical office and listed phone number; codify a requirement that suppliers reenroll in Medicare every three years; prohibit suppliers from reassigning a supplier number; and apply criminal and civil sanctions for misrepresentations on billing number applications (para. 2).

One new major reform of the durable medical equipment is that Medicare is proposing a competitive bidding program for suppliers. Senior Journal.Com (2006) states the following proposal:

The new competitive acquisition program, which is required by the Medicare Modernization Act of 2003 (MMA), would replace the current DMEPOS fee schedule payment amounts for selected items in select areas. CMS has discretion under the law to first phase in DMEPOS items for bidding based on high cost and volume or largest savings potential. Suppliers in a competitive bidding area would submit bids for selected items, and CMS would use these bids to establish Medicare payment amounts for these items. Under the proposed rule, the Medicare payment amounts would be the median of the winning suppliers' bids for selected items (para. 5-6).

Payment policies for most insurance providers are based on what the Federal Government reimburses businesses for services and supplies. According to Medicare.gov (n.d.) the payment method that is established is called assignment which is an agreement between Medicare and doctors, other health care providers, and suppliers of health care equipment and supplies (wheelchairs, oxygen, braces, and ostomy supplies). Doctors, providers, and suppliers who agree to accept assignment accept the Medicare-approved amount as full payment. The patient pays the coinsurance (usually 20 percent of the approved amount) and deductible amounts.

West Virginia has several requirements on top of what Medicare has established as policies of opening a Durable Medical Equipment (DME) business. The State requires businesses to have a valid business license; a physical store location, within a 30-mile radius of WV borders; be handicapped accessible and be able to show detailed records of all customers serviced by the organization. West Virginia's government does random audits of billing from DME companies. The Medicaid program of WV has the same guidelines as Medicare in requiring providers to write a prescription for medical necessity for durable medical equipment (State of West Virginia Department of Health and Human Resource, 2002).

Future

The future of the durable medical equipment market is going to grow as the baby boomers start to age. Baby boomers are those citizens that were born between 1946 and 1964 in the United States. The Great American Group (2004) states "As our nation's baby boom generation moves further into retirement age, and as life expectancies continue to expand, the need for medical equipment will grow exponentially" (para. 1). D.R. Clark (2006) gives the following outlook:

Investors in biotech and many other healthcare concerns are often relegated to distant investment time horizons, requiring the biblical patience of Job. But healthcare's conservative kissin' cousin, durable medical equipment (DME), shouldn't be overlooked with the massive throng of baby boomers in need of 'replacement parts.' DME, which generally lacks the FDA hurdles associated with biotech, may indeed hold greater immediate promise for investors Excite Money and Investments (2006).

Consistent with this claim, there seems to be room for growth in Beckley, West Virginia. Robert Butcher, the Pharmacy Director of Access Health Pharmacy, stated that Eppy's Drug store located in Beckley, WV does most of their business by selling durable medical equipment. He said most of the sales of this type of business is a cash business and provides extra revenue for the company. He mentioned that the service could be easily implemented within the current pharmacy services that are provided by Community Health Systems. In regard to Eppy's Drugs, he mentioned that he felt like most of their income was from the home health side of the business and less from filling prescriptions. (Personal interview, June 3, 2006).

The future of healthcare is only going to keep getting more expensive. Federally qualified health centers have the chance now to make a dramatic change to healthcare within the United States. These organizations are allowed to offer discounted medical care to the underserved population. The President of the United States stated "I support increasing the number of community health centers across America. Community health centers are community-owned, locally administered medical clinics where people can receive preventive care, free vaccine clinics, health alerts, disease screening, and counseling. They have become America's health care safety net. Under my plan, we would provide $3.6 billion in federal money over a five-year period to create 1, 200 new centers from coast to coast" (USA Today, 2000).

Apropo Benefits Management states that "Looking ahead, as the aging of baby boomers affect the utilization of DME benefits, it's estimated that the current $6 billion spent on this population alone for DME services will nearly double over the next three decades" (Apropo Benefits Management, n.d., para.4). This leads to the fact that baby boomers are going to need these items to function in daily living. Companies that capitalize on this market will people function as normal as possible with the use of advanced technology in the durable equipment market.

According to Joe Flower (1996), the future of healthcare around the world will be based on the following four changes. First, healthcare communications will drive future healthcare with the wide array of advances such as satellites, online forums, and medical imaging equipment. Second, outcomes management will drive healthcare. Doctors and individuals will be scanning millions of past occurrences to determine what therapies have worked in the past. The other part of this system in called "expert systems" which will help doctors diagnose and treat patients more effectively. The third change in health care will focus on the care of patients. Patients will be moved out of hospitals and back to clinics, doctors' offices, patient homes, and schools. Finally, the focus on population health will change health care. Citizens will be able to prevent a lot of medical problems by curbing environmental issues, drinking, smoking and other things that cause health related issues.

In addition, there are two major trends in the United States that are changing the healthcare system: restructuring and reform. Restructuring is where hospitals will be closing as patient care moves to clinics and other doctors. The reform trend is where government will step in to help control healthcare costs. At the present time, the reform movement is on the local and state level where research is being conducted to determine if they can reduce healthcare cost and help the patients maintain a healthy lifestyle (Flower, 1996).

What has been done in similar situations?

A company located in Ohio called Progressive Medical, Inc. started out in 1986 offering electromedical equipment and medical supplies. In 1990 they saw the need to expand services and started offering durable medical equipment. In 1996 they expanded again by opening a pharmacy that offered home delivery service to its patient base. The company is considered a managed care cost containment company where they provide services to the community in which they live (Progressive Medical, 2006).

According to Pharmacy Times (2005), pharmacy services and home health care work well together. Pharmacists know their patients better than most other healthcare providers and can help decide what equipment they might need. This service offers the patient the convenience of simple billing, one-stop shopping, and a friendly face. Pharmacy Times states that "DME sales will grow between 18-21 billion by 2008" (Wertheimer, Chaney, Santella, Popomaronis, & Mick, 2005).

The trend of combining pharmacy services with home health care products is growing. Companies are seeing that people are getting older and that they need products that help them function throughout the day. Implementing durable medical equipment as an add-on service offers companies an opportunity to create additional revenue sources with out much overhead by combining these services. Durable medical equipment is going to become a big business as more and more technology advances occur to help people function better in their daily lives.

Walgreens Pharmacy is seeing the future of home health care products and has expanded its services to offer respiratory services, home infusion services, and home medical equipment. By providing these services it allows the pharmacist to offer better patient monitoring and education about the products that the company provides to customers. The overall goal of Walgreens is to offer cost-containment solutions, benefit coordination, and account management for their customers (Walgreens Pharmacy, 2006).

According to Mickey Plunkett, a sales representative for Physician Sales & Service that sells medical supplies and equipment, more and more clinics are implementing the selling of durable medical equipment and supplies as an extra revenue source that requires little overhead. He mentioned that he can wholesale all the types of supplies required for this business. By adding durable medical equipment the company's providers can write the prescription for the patient to receive the product and they can obtain it immediately within the clinic's location. By already operating a free standing clinic the paperwork to get started for this business is minimal and can be implemented within a matter of days (Personal interview, June 10, 2006).

The trend seems to be that more and more major retailers are combining the add-on service of Durable Medical Equipment (DME). According to Smith, "by providing DME to patients, hospital pharmacies can realize substantial net income while improving continuity of patient care" (Smith and Popilarski, n.d., para. 1). This reduces overhead and is easily implemented with services already being offered to patients.

Clearly, the research shows that combining durable medical equipment with existing services is very beneficial for the company and patients. Patients' care can be better managed by their healthcare provider if everything can be controlled within one location. The major drawback of implementing this service is the strict guidelines that most insurance carriers require. However, the overall benefits outweigh the negatives and help the patient live a comfortable life.

Organizational Buy-In

The management team of Community Health Systems, Inc. wants to see the financial projections of the revenue potential of this type of business. Given the financial impact of such an expansion, they are committed to the research. Employees of the organization are committed to providing quality healthcare to the patients of southern West Virginia. The board of directors of Community Health Systems, Inc. is very interested in offering this type of service because they know that the majority of patients are elderly and need durable medical equipment to function. The community as a stakeholder would benefit because the company helps lower healthcare costs and provides services that are needed within the area.

Making this type of business a success requires leadership that has a vision of where they want to go and a mission to create customer value. Strategic Leadership is essential because it allows people to demonstrate the potential of something and create a learning environment. This would be a great opportunity for the organization to allow people within the organization to step up and take a leadership role in operating a business such as the durable medical equipment. If the organization decides to operate this type of business they need to make sure it balances with the goals of the organization. Businesses are designed for one thing and that is to impact the bottom line and operating without a clear focus will end in failure.

Methodology

Methodological Assumptions

Based upon the researcher's experience, a number of assumptions made in regard to this project. First, the researcher assumed that a lot of policies would have to be reviewed to make sure the key components of opening this type of business were examined. Second, the researcher assumed that the durable medical equipment field is heavily saturated. However, the researcher believed that this type of business could be a success for the organization as long as the management team has committed to providing the necessary funds to implement this business model. Finally, the researcher understood that researching this type of business field would be cumbersome. A number of challenges were met in preparing a document that is comprehensive and beneficial to the management team of Community Health System, Inc.

The action research process of this project was identifying the problem which consisted of determining the feasibility of adding a durable medical equipment business to existing services. The second step was taking a course of action that consists of researching what others have done and the potential benefits of such a business. The third step of action was taking action on the purpose which was determining the feasibility of the durable medical equipment market. This step determines how to start the business and what is needed to get the business opened. The fourth step of action was evaluating the steps of action the researcher implemented previously to determine if he/she is on the right path. Finally, the last steps of action was identifying the findings and reflecting on each section of the project to learn and determine if something could be done a different way.

The facilitator chose action research to use because it involves participatory hands-on learning. According to R. O'Brien (1998), "Action research is used in real situations, rather than in contrived, experimental studies, since its primary focus is on solving real problems (para. 14). This method of research provided the researcher with valuable information by working with the management team, employees, customers, and state agencies in finding information about the durable medical equipment market. Coghlan and Brannick (2005) states that "Action research has been traditionally defined as an approach to research which is based on a collaborative problem-solving relationship between researcher and client which aims at both solving a problem and generating new knowledge" (p. 9).

This method worked well for the facilitator in working with the management team in learning about the subject of this project. Literature information was reviewed and analyzed, so that it could be interpreted into actual facts and presented within this report. Action research allowed the facilitator to put the findings into action and learn from each step within the action research model.

Research Processes

The first step of action was gathering information from the meeting with the management team to determine what products they wanted the facilitator to explore. Second, after gathering the information, the researcher prepared the surveys. One survey was designed for the patients and the other was designed for the providers of Community Health System, Inc. The patient survey was distributed among the nine locations that the organization operates. The receptionists at these locations had instructed the patients to fill out the brief survey. The survey was given to all patients for a one week period. The researcher hand delivered the provider surveys and asked them to fill it out and send it to the administrative offices after completion to keep them separate from the patient survey.

When this information was gathered the researcher prepared a graph of the findings and presented the findings to the management team of the organization. At this point, the researcher asked the company to purchase CPT and ICD-9 coding books, so that the researcher could find the billing codes for durable medical equipment to move the project ahead. CPT stands for current procedural terminology and each service has a five digit billing code used by insurance companies to determine what the patient had performed by the physician and what services the insurance is being billed. This list of numbers is maintained by the American Medical Association and is used for billing codes for services rendered (http://en.wikipedia.org/wiki/Current_Procedural_Terminology). The ICD-9 coding book stands for International Statistical Classification of Diseases and Related Health Problems. It is published by the World Health Organization and is used world-wide for morbidity and mortality statistics, reimbursement systems, and automated decision support in medicine (http://en.wikipedia.org/wiki/ICD-9). These two books gave the researcher the information to start looking for payment rates established by the health care insurances to determine their rate of payment for services related to the durable medical equipment market. The researcher had built the financial section of the project using the most common durable medical equipment used. Those items were calculated to determine the potential profit. The researcher used the following insurances as guidelines when calculating potential revenue from durable medical equipment: Medicare, Medicaid, Blue Cross/BlueShield, Benefit Plan Administrators, Accordia, and Aetna. These insurances make up most of Community Health Systems patient base. For patients that don't have insurance, the researcher established pricing schedules based on the sliding scale fee established by Community Health Systems, Inc. The rate is broken down into the following five categories 20%, 40%, 60%, 80%, and 100% based on household income. If the price required is less than what the organization pays for the product, then a markup of 10% was added to the item and was considered a cash only sale for the product. The next step in the research involved contacting vendors and gathering information on the wholesale price of the equipment and supplies that make up the durable equipment business. Based on this information the researcher prepared financial data that was relevant to the purpose of the project. Microsoft Excel sheets were used for formulating the financial projections.

Rigor

The researcher was presented with a number of challenges. First, it was difficult to find accurate payment rates from insurances in relation to the durable equipment market. The researcher was interacting with employees and patients to find information that was useful for the management team and the research project of durable medical equipment. Second, gathering the surveys from the receptionist at all nine locations was challenging. It was important for the receptionist to understand that each patient checking in must be given a survey and that the surveys must be returned once they left. The patient survey captured only a weeks worth of patients and did not reach the entire patient base of the organization. Putting all the findings into a report that is useful and beneficial was challenging and required the researcher to spend a lot of time researching, writing, and constructing each section of the project. Presenting the findings to the management team required a lot of leadership in conveying the evidence of the project.

Ethical Issues

The first ethical issue that the researcher was faced with was keeping all information confidential until time to release the financial projections to the management team. The second ethical issue was assuring all participants that their names will not be included in the research and that their confidentiality was protected. The third issue was preparing financial projections that were accurate and presenting them to the management team. Finally, the researcher was prepared to take criticism on the findings and was prepared to back up findings with data.

Constructing Accounts

Setting the Scene

Community Health Systems, Inc was looking for revenue projections and the feasibility of the Durable Medical Equipment market. The facilitator provided financial analysis and it showed the potential reimbursement rate of the business opportunity. The facilitator guided members of the organization in formulating a plan of action that is consistent with the business scope of the organization.

Constructing Accounts

The facilitator provide two surveys, one for the patients and one to the providers of Community Health Systems, Inc. The patient's surveys shown that they would like to purchase Durable Medical Equipment as they see their provider for an office visit. This eliminates the worry for them about having to deal with paperwork and more than one provider. The providers expressed interest in how much time would be saved by offering Durable Medical Equipment with current services. The provider's survey showed that they average about five patients a week for referral services to other Durable Medical Equipment businesses. The facilitator translates that information into fifty-five patients a week getting referred to other organizations that provide this type of service. The surveys showed that the time required for paperwork referrals would be decreased and allow the nursing and provider staff more time to see other patients. The patient buy-in was exceptional from the sixty-three surveys returned because they want to purchase low-cost products. Community Health Systems, Inc. can offer the items at a low-cost because of the purchasing contracts that in place with the federal government. The sliding scale financials for people that do not have insurance showed that the company can still make a profit by providing these types of products.

The facilitator gathered statistics on the state of West Virginia and it showed that West Virginia is an older generation of citizens. According to West Virginia Health Statistics Center (2003), "The Graying of America has begun in West Virginia. Compared to 343, 156 people aged 45-64 in 1950, there were 455, 282 in 2000. The population of residents aged 65-74 increased from 94, 833 to 148, 463. However, the number of people aged 75 and older has nearly tripled, from 42, 896 to 128, 432" (para. 4). This is strategic opportunity for the organization to capitalize on and provide products to the patients.

In the survey process, the facilitator used the servant leadership style model of leadership to allow others to voice their ideas and suggestions in relation to the durable medical equipment market. The facilitator provided guidance and worked as a team member with other employees in determining the scope of the durable medical equipment market. This was how the facilitator built relationships with the participants, so that the strategic plans of the organization can be achieved by having energized leaders to carry out the potential of an idea or suggestion.

The personal interviews related to the project provided a great deal of information about the durable medical equipment market. Charles Hunt, CEO of Community Health Systems, Inc provided the guidance in what the organization was wanting out of the research in previous communications. The facilitator then contacted patients and providers using a survey. From the information received the facilitator recognized that there was organizational buy-in.

The main portion of the project was establishing Microsoft Excel spreadsheets of the potential profit of each item. The first projection was established for people that had insurance coverage. It showed the potential reimbursement rate that the insurance carriers would reimburse an organization for in regard to a certain product. The second set of financial projections was established for people that had no insurance coverage, but based on the sliding scale fee structure. This was the key part that the management team of Community Health Systems, Inc. was looking for to see what type of products offered the biggest return on investment.

Epiphanies

The facilitator special moment in the project came at the beginning of the research process. The facilitator was researching and finding nothing about durable medical equipment except policies. The facilitator then shifted the frame and focus and looked for trends related to durable medical equipment. The trends showed how the baby boomer generation was growing and the needs that were going to be needed in relation to the healthcare field. The statistics for this generation show that the needs for durable medical equipment products are going to be at an all-time high in the future. The evidence clearly show that people are going to live longer lives, but will need products to help them function as normal as possible.

Constructing General Accounts

The researcher discovered trends that point to the future of the durable medical equipment market. The most notable trend in relation to the overall healthcare market is the aging of baby boomers. The older generation of adults is going to need products and supplies that allow them to function in society. The research show that most older citizens are going to need mobility products that allow them to use their head, arms, body, and legs to function as best as possible.

The management team was looking at profit potential of products and the facilitator provided financial projections that show what the potential is for each item. The research shows that start-up costs are minimal since the services can be added on with current pharmacy services. The main cost to the organization is initial inventory costs and this was discussed with providers in what products receive the most referrals.

Contextualizing

Summary of Outcomes

The facilitator's experience was a learning opportunity that required interaction with the employees and patients. The providers were excited that the management team wanted their input on the potential of offering durable medical equipment. The employees were excited because they felt like they were owners within the organization. Patients were very excited since they would be able to purchase items at a low cost and not have to worry about all the paperwork requirements. Just by doing the surveys the facilitator notes that a lot of time would be saved and could be used on more productive activities by not filling out referral paperwork. This would provide more time with the providers to spend with their patients. Nursing staff would not have to get everything together to send with the referral paperwork.

The evidence shows that the market potential for durable medical equipment market is there. The organization is in a position to offer the service without much up-front overhead. The statistics on West Virginia shows that the population is consisted up mostly of older people.

The stakeholders viewpoints is that there is a market for durable medical equipment within the business scope of Community Health Systems, Inc. The research shows the majority age group of West Virginias is old and need this type of service at a low cost. The personal communication that the facilitator had with the Pharmacy Director, showed that he was right in stating that adding the service with existing pharmacy services would not cost a lot and could provide an additional revenue stream for the organization. The organizations major stakeholder the United States Government would benefit the most since this is a big part of the Presidents plan to give more grant money to community health centers. The governments plan is to shift more money and resources to these types of businesses to help people save on money for doctor's visits and prescription drugs.

The implications of the study on the policies within the organization would require a step-by-step procedure to be written to show the providers how to refer the patients to the pharmacy to receive their products. The services that would be affected would be the pharmacy because they would need to be training on what requires a prescription and what does not require a prescription. The management team would have to update their strategic plan to include durable medical equipment into the company's range of services. The facilitator notes that there are no major implications by the outcomes of this research.

Plan of Action

The facilitator would recommend the organization to expand into the durable medical equipment market because of the potential and low-cost investment. The organization can test the market to see if the potential is really there as the research had shows. The facilitator would then recommend an advertising campaign in all clinics associated with the organization to inform patients of the new expansion of service. The management team should select a person that can lead this project. This step is important because he/she will build a team that has a common goal. This person would be the contact for employees and patients in determining the needs of each group. This person would then work with the pharmacy staff to determine the area in the pharmacy where the products would be carried. This team of employees then would determine inventory levels to establish before offering this service to the patients.

The facilitator's evaluation of the plan would be by monitoring products sold and analyzing financial statements monthly. The management team would meet with the leader that they selected to make sure that patients are informed of the services and that the providers are referring them to the pharmacy for services related to durable medical equipment. By doing this method of evaluation the management team would be able to determine to continue the business or eliminate it from its current operations.

The plan of action from this research would have to have detailed goals. The management team would have to establish these to the business leader that is leading the project. Brainstorming sessions could be used to formulate advertising plans to inform the community about the services that the organization is offering. The information from this project should have shown management to let the employees be creative in their jobs and allow employees to make suggestions on services and how they can be done more efficiently. The business is simple and easily implemented because of the low overhead costs. The management team should not micromanage the opportunity, but give the project leader the responsibility to make it a success.

The conclusion of the research is that the information found from all sources shows that potential of durable medical equipment is established in the trends that were discovered in the research. The patient base of the organization is older people that need these types of products now. The implementation is rather simple since it would be added onto existing services. The providers would play a key role in informing their patients that the organization offers these products and at a reduced rate than their competitors. After the implementation of the project the management team should look at more opportunities for expansion that require little overhead because it adds to the bottom line of the organization.

Evaluation of Results

The evaluation of opening this business would be to monitor the financial statements monthly. Talk with providers and discuss new products that need to be kept into inventory. The leader of the business should send out more surveys in about six months and ask how they are doing and what could be improved to meet their needs. The management team should look at the business volume on a monthly basis and look for areas of improvement.

Leadership Elements

The four key leadership elements that the facilitator used were learn, direct, analyze, and reflect. The facilitator kept an open ear and listened to what the participants had to say. The facilitator was creative in designing the project and enjoyed the relationship building that the projected allowed to form. Selling the idea and research conclusion was the most interesting part because it taught the facilitator the key to leadership. You have to sell yourself and take the stage and perform what you're required to do.

References

Apropo Benefits Management. (). Durable Medical Equipment: a tough challenge. Retrieved June 15, 2006, from http://apropobenefits.com/DMEperspective.html

(Centerfor Medicare Medicaid 20 NEW HHS REGULATION FIGHTS MEDICARE FRAUD AND ABUSE AMONG DURABLE MEDICAL EQUIPMENT SUPPLIERS)Centers for Medicare & Medicaid. (20). New HHS Regulation Fights Medicare Fraud and Abuse among Durable Medical Equipment Suppliers. Retrieved June 17, 2006, from Centers for Medicare and Medicaid Services Web Site: http://www.cms.hhs.gov/apps/media/press/release.asp?Counter=42

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Butcher, Robert. Personal Interview, June 3, 2006.

Hunt, Charles. Personal Interview, May 28, 2006.

Plunkett, Mickey. Personal Interview. June 10, 2006.

By William Bass - Entrepreneur that writes about niches subjects as well as current events going on in the world.  





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