Select and Implement the Proper HME Software Program: Part 2

• By Bob Radvanovsky, Deborah V. DiBenedetto
• Sep 01, 2004

This is part two of a three part series on how to select and implement the proper HME software program for your business. In part one, see the March 2004 issue, we covered reasons that companies were looking for new HME software, what basic features a good HME software program should provide and asked you to develop a list of features that you believe are important for your business.

When someone is looking to purchase a new HME billing program for their business, they typically ask four basic questions:

1. Who are you?

2. Tell me about your training and how many people do you have in support?

3. What makes your HME program better than your competitors HME program?

4. What does it cost?

In this article we will conquer the first three questions. The fourth question?cost?will be answered in the third article of this computer software series in October's issue of Home Health Products.

1. Who are you?

The first basic question you should ask a prospective software vendor is who are you? You need to find out everything you can about the software vendor. Usually people ask the following questions:

How many total locations are actively using your HME software?

If I purchase from you, how will I know you will be in business next year, especially if competitive bidding becomes a reality and companies get out of the HME business?

People want to know if the prospective software vendor they choose will be around in the next couple of years. In the past 10 years there have been many HME software vendors who have gone out of business, sold out to a competitor or merged with another competitor. If your software vendor goes out of business and your program is discontinued, then you must go out and purchase another program to replace it. If you are lucky and the acquiring company keeps the software, that company may significantly reduce or stop enhancements except for regulatory issues.

There are some other important questions you should ask:

Are you a publicly or privately held company?

If privately held, now many major owners are there?

What were your gross revenues last year?

How many new systems did you sell last year?

How many customers did you lose last year?

How many programmers work full-time on coding new features for your HME program?

How many programmers, not included in the above, work on bug fixes or regulatory issues?

What is your commitment to the HME industry? Including questions like, Are you a member of AAHomecare, any state associations or HMESA?

Are you an approved consultant with VGM?

The answers to all of these questions will tell you a lot about the quality and the stability of the company from which you may purchase software.

2. Tell me about your training and how many people do you have in support?

This is definitely an important part of the process of purchasing software. This is definitely one place where you do not want to cut back or skimp. Good training is vital to the accurate operation of any software program. HME billing is the most complicated billing in the health care industry, so knowing how to set up your files correctly so that the ordering, claims generation and reporting are accurate is vitally important. Questions that you should ask about training should include:

What are your training methods? Do you use computer-based training? Do you use videotapes, CDs or DVDs? Do you use phone training? Do you use online training? Do you use classroom training? Do you use on-site training?

Why do you use the methods you do?

Which of these methods are included in the standard purchase price?

How many people do you train in each method?

If additional training is needed, what are your rates for each type of training?

When should you purchase additional training?

Normally, if you have one to four people needing training, that can be accomplished in the normal training that is included with a system. If you have five or more people that need training, you need to consider purchasing at least double the basic training where you learn how to enter doctors, carriers, patient, items and serialized items. That way you can have half of your staff trained while the other half holds down the fort at the store. I would recommend training half your staff in the morning on a subject and then the other half in the afternoon on the same subject. This offers you two big advantages. First, you can keep you store operating as normal. Second, with training handled in small four hour segments, your staff does not get overloaded with too much new information. This prevents the deer in the headlights look when you try to train for eight hours in a day for two or three days. A trainer I know said that people tend to get a case of the "uh'uhs," when they have too much training thrown at them all at once.

When considering who should get trained, consider the following. Train everyone who will use the system in any way. Don't train just key people and then try to have them train everyone else at your company. This type of training is like playing the gossip game, everytime someone retells the story, they can't remember it just right so they either leave out part or change part of what was said. Everyone needs to understand how each base file is set up and how it affects the order, claim and reporting process. You should always have training performed by the company where you purchased the software. Do not rely on your staff to train others. As a side note to this issue, you should always budget for additional software training each year. Even if you have the best trainer and the best trainees, no one can remember everything from a training session. Additional training is important. With continuous training you will pick up what you missed the first time. With software programs dynamic and always changing, you should be trained on the new features and procedures. You need to attend classroom training offered by your software vendor at least once or twice a year. At least every two years you need to pay to have a trainer come to your business and help you with specific issues that you might have. If your software vendor holds an annual user conference, you should always send at least two people to that event.

Many HME suppliers measure quick response from a software vendor based upon their number of software support techs. Two things you need to find out from any potential software vendor are:

What is the average response time from call to call back?

What is the ratio of support reps to active customers?

It also is vital to know how many full time support people each software vendor has dedicated solely to supporting their HME product. This means that these support reps are not also programmers or trainers. These are people who are always available to answer your call. You should also find out if you have a support rep dedicated to your account or are calls handled by the first available rep? If you have a dedicated rep, you need to know what kind of support you can expect when that rep is out sick, on vacation or no longer is employed at that company. Other questions to ask might include: Can you get the name of the support manager or supervisor? Are they available if you are not happy with the support you are receiving?

One important issue to ask about is how much will support cost? You need to know how often that support is billed?monthly, quarterly or annually. You need to know what does that support cover? Does it include software support? Is that via a toll free number? Does it include bug fixes? Does it include updates? How often updates are sent out? What method is used to update the software?diskette, CD, DVD or online? When was the last time support was increased and how much was that increase? When does the vendor anticipate that support might increase again?

3.What makes your HME software program better than your competitors HME software program?

You should consider asking each potential software vendor to give you their three strongest features and their three weakest features. All vendors have strong points and weak points. It also is important to remember that all HME businesses are not the same, so their needs are not the same. Due to your product mix, insurance mix, size of your business, ownership or location, your software needs can be different from someone else's.

Back in Part 1 of this series, I asked you to create a list of other features that you feel are important. This list should be made up of general features and must do features. It is important to remember that the must do features should not exceed 5 percent of your total features. A good program should handle 80 percent of the general features on your list and 90 percent to 95 percent of the must do features. Pull that list of features out and let's add some things to it.

First, you need to ask your employees what areas of your business are hard to manage on a manual basis and that should be improved with the addition of HME software. If you are looking to replace your existing software, you should ask employees to point out the features and functions of your current software that does not meet your expectations.

Here are some software issues and questions you should consider when creating your feature and function list for prospective software vendors?

You should take into account the product mix you currently have and what areas you might want to grow into over the next three to five years. Are you a full line HME business? Or do you specialize in respiratory, rehab / mobility, infusion, nebulizer medications, diabetic supplies, disposable / consumable supplies like enteral, ostomy, urologicals? Add specific questions to address these product specific needs of your business. For example, if you handle oxygen, you need to see how the system handles serial numbers and lot number for oxygen cylinders.

What is the current mix of your customer base?

What percent is Medicare, Medicaid or commercial insurance? How many insurance plans does your average patient have at any one time? How many insurance plans can the vendor's software have on a patient at the same time? How many of those insurance plans can be billed on the same order without any additional input from a user? Does that maximum number include billing the patient?

Can the program do direct electronic claims to the DMERCs / Medicare?

How many DMERCs do you need to bill electronically? Is there an extra purchase cost to bill DMERCs outside my current region? Are there additional support fees for billing additional direct electronic DMERC claims?

Can the program do direct electronic claims to Medicaid for your state? Is this included in the purchase price or is it an additional option that costs more? Are there additional support fees if you use this program? Can your program do direct electronic claims to other state Medicaids? If so, which ones? Do these cost extra to purchase? What about additional support fees?

Can your program process direct electronic claims to BC/BS for your state? Is this included in the purchase price or is it an additional option that costs more? Are there additional support fees if you use this program? Can your program do direct electronic claims to other BC/BS? If so, which one? If so, which ones? Do these cost extra to purchase? What about additional support fees?

Do you offer an option for a clearinghouse for claims to other commercial insurance carriers? Is this included in the purchase price or is it an additional option that costs more? Are there additional support fees if you use this program? Are there any annual or per claim charges? If yes, what are these charges?

Do you deal with any capitated insurance? If so, can the program handle this?

Do you deal with any hospices? If so, what are their special billing needs? Can the program handle these special needs?

Do you have a need to provide product to one party, but then bill the patient portion to a different third party? If you do this, does the history stay with party one or do the charges move to party number two?

Can multiple patient accounts be billed to a single third party account? Can you see the patient's purchases and rentals separately, but the accounts receivable is only listed under the responsible third party with the charges separated and totaled by patient?

Do you have a need to track referrals? If so, can the program handle this. Is this feature standard or does it cost extra?

Do you have a need to track sales reps? If so, can the program handle this. Can it track and calculate commissions? Is this feature standard or does it cost extra?

Are you doing mail order? If so, does the software offer an optional interface with UPS, FedEx and/or USPS?

If you are dealing in consumable supplies such as diabetic supplies, ostomy, urological or wound care, does the vendor offer an IVR (Interactive Voice Response) system? This would allow your patients to call in refills just like they do in a pharmacy. If so, how much does this cost?

How much walk in retail business do you have? Does the software have POS solution that is in the basic package or is their an optional POS module? Can the purchases of cash customers be stored in some type of patient purchase history? Can your POS system handle items that are covered by insurance and not charge the patient for portions that are covered by insurance?

Do you need bar coding for items? What about bar coding for serial numbers, asset control numbers and lot numbers?

Have any of your doctor's shown interest in doing eCMNs? If so, does the program you are looking at have this capability? Many doctors are beginning to do electronic prescribing with area pharmacies, so they may be more willing to look at doing eCMNs.

What about PDAs for deliveries? Do you need to download orders to PDA so that the drivers can take these into the field? Do you need to capture delivery signatures? What about scanning bar codes on serialized or lot numbered items? What about swiping credit cards for patient co-pay amounts?

What is the current operating system in your store?Windows, Unix / Linux, Mac? Are you willing to change operating systems? Most HME billing systems are now Windows based, so if you are still on an old MS-DOS based program, Unix or a Mac, then you will need to spend additional money upgrading your hardware.

If you need to upgrade your hardware, see if your proposed software vendor also supplies and services hardware? There is a real advantage to purchasing all your hardware and software from one place. When something goes wrong the software vendor can?t blame the hardware and the hardware vendor can?t blame the software. You just have to place one call and say fix my problem

If you are purchasing hardware also from the vendor, find out how much hardware maintenance is? Otherwise, you have to decided how long your system can be down before it is fixed.

Is the system you are looking at a 32 bit GUI Windows application?

Do you have a need for ODBC, SQL, or data accessibility? Is a data export module available if the system is not ODBC or SQL? This allows you to extract the data you need.

Can you modify the standard reports that come with the system? If not does the program include a customer report writer of some type? Is this feature standard or is their an additional cost?

Can you can in pictures or documents to the patient, order or item records? Is this feature standard or is their an additional cost?

With the new HIPAA security regulations required by April 2005, what features does your program have to address these regulations? Are there additional software purchase and maintenance fees associated with this feature?

Do you offer integrated accounting modules for purchase orders, accounts payable, general ledger, payroll, depreciation and check book reconciliation? If these modules are not integrated, do you interface directly to an external accounting package? If so, which packages?

Do you need to integrate your HME system with other programs? Home health, hospital systems, infusion/IV, or pharmacy? How much do these other programs run?

If you need an integrated system, what data do the programs share? Doctor information, patient information, inventory, accounts receivable?

Next month, in the third and final article of this series, we will answer question number four: What does it cost? We also will take a look at the issues surrounding data conversion and outline the implementation of your new system.

This article originally appeared in the September 2004 issue of HME Business.