Products & Technology

The HME Online Storefront

How providers can evolve their websites to a more transactional model.

• By David Kopf
• Feb 01, 2014

What if you had a way to interact with your patients, clients and referral partners at any time you wanted? What if they could get information about your services, learn about the latest DME and interact with your business without even having to get on the road on your store? What if they could buy retail home medical products at any time they wanted? What if you could essentially set up a store in every living room in your local area? What if you could do that across the entire world?

The answer is that you can, and that you have been able to do that — online. This has been the promise of the web for more than 15 years. Almost as soon as average consumers could start searching the web, businesses have been learning how they could interact with and sell to their customers.

So how far have providers progressed with their web sites, and, more importantly how can they develop web sites that will help them effectively communicate with their patients and their partners, and possibly transact with them? In short how can their sites succeed?

It comes down to making some very basic, but very central decisionmaking, says Jeremy Kauten, general manager of VGM Forbin, a web consulting business that helps VGM members across the organization’s entire customer base create, implement and maintain their web sites and social media presences. Overall, the firm maintains roughly 1,600 web sites, 700 of which are for DME providers. Working with such a broad range of providers has helped Kauten get a bead on provider web strategies.

“What we’ve found is that providers need to decide which direction they need to go on their site,” he says. “I see that as one of the biggest failure or success points.”

Two Models

That decision ultimately comes down to choosing from two basic directions in which the provider can route its web strategy. On one hand, does the provider want to get more products for reimbursement? If so, then the provider needs to shape its web site so that it attracts more of the patients and parties involved in funded transactions, and then provide them with the information they need to help make that funded transaction happen, Kauten says.

“The alternative is more of the cash sales, transactional, Amazon.com model, or even competing with Amazon.com,” he says. “And I believe they need to select one of the two models; not try to have both. One is a high level of service with a high level of touch point. … The other is lower-cost, less service, and less overhead.”

When providers try to mix both models, pricing becomes a problem. Since Medicare doesn’t let providers selling a reimbursed product for cash at a lower price, trying to straddle both online strategies essentially undermines either business model. This can even extend to private payor reimbursement, where an insurance carrier could drop a provider for offering funded products to online retail customers at a lower price, or demand that lower price for its funded beneficiaries, Kauten explains.

In any case, these two online storefront models are seeing some change and evolution, and Kauten says providers need to be ready for those changes. Kauten says the biggest change is mobile. This is particularly important for the model that targets funded patients.

“In 2014, based on statistics, there will be more Internet usage on mobile devices than on a computer,” he says. “A lot of web sites are not mobile-responsive, where it responds to the screen size.”

And the fix from three or four years ago of having a dedicated mobile site is not ideal, because those mobile sites typically strip most of the content away. The site must leverage new technology to responsively adapt to screens of all size to ensure they are showing all the content. For nurses and case managers in the field with tablets and smart phones, the responsive design is ideal, but has its trade-offs.

“It’s all of the same content, but re-framed smaller,” Kauten says. “It costs a lot more to do that, and a lot of web designers who haven’t reinvented themselves over the past couple of years are not able to do that.”

Another important consideration is searching, and because of that social media. Providers want to be found, and increasingly that means engaging in social media.

“A lot of your Google ranking is being impacted by social media,” Kauten explains. “Where before you’d have an optimized site for Google or Yahoo, having ad words for, or paying Google or Yahoo, well they’ve added in a third component to measure popularity and site score: social media.

“Whether its YouTube videos or activity on Twitter, Pinterest, Facebook, or LinkedIn, Google is measuring that social media activity and putting that weight onto your search engine ranking,” he continues. “Where people would say social media is an up-and-coming trend, now it’s here.”

HME businesses, for the most part, are not yet leveraging social media anywhere near where they need to be, Kauten says.

For providers that are engaged in more transactional, retail salesoriented sites, perhaps the biggest elements is price. In a world where customers can cross-compare goods and prices at the click of a mouse, providers must be savvy at setting prices.

“Price is King,” Kauten says. “Google makes it very easy for you to find prices online and list the top 10.”

The second item, right behind price, he says, is having the right product mix.

“Instead of trying to be the everything in every category DME, set up a focused site on a certain product line — one example would be bath safety,” he advises, adding that focus helps draw customers. “If your site focuses on one or two categories, Google can more easily rank your site based on that. If you dilute your site with multiple categories, it’s harder for Google to tell what you’re trying to promote.”

And right behind that is the ability to easily switch those product lines. If a provider sees a category poorly performing, or if new competitors crop up in that category that begin to eat away serious market share, the provider needs to have a web model (and the business model behind it) to quickly drop that line and add new ones.

“A lot of people I’ve talked to in other industries that are successful have already gone through that,” Kauten says. “In this industry we still need to learn the behavior of online shoppers.”

Making Funded Sites More Transactional

While there might be two core models, the funded model doesn’t necessarily preclude the HME business from conducting online transactions. In fact, it might be critical to their success, says Chris Watson, chief marketing office for software maker Brightree LLC.

“Where we see most of the successful providers going today with their web site is that it is going to be a more transactional e-commerce site that will drive revenue,” she says. “And that revenue can come in two forms: it can come in the form of making it easier for patients to do business with me, or it can be from up-selling customers who are already buying from you.”

A good example of how providers could add an example of e-commerce efficiency and revenue generation to a funded relationship would be re-supply. Last year, Brightree introduced a set of tools and services that let CPAP providers more easily and efficiently notify their patients that they were able to obtain funded re-supply items, such as masks, and then conduct that transaction online via an interface that bears their branding.

“I see a lot of our consumable, re-supply-type shops going down that path,” she says.

Another example would be leveraging the web to collect patient co-pays. Thanks to its integration of patient collections firm StrategicAR, Brightree is working to give providers tools for using the web to help collect patient co-pays.

“On the invoices that are sent out, you drive that payment to a web site, and you make it very easy for the patient to pay the bill,” she says. “So as a provider, you’re making it very easy to drive those eyeballs back to your web site to collect that payment, and while you have them on that site, you could potentially up-sell them for more.”

Then, the provider can supplement those activities by giving their patients and partners useful information and resources that they’ll value. Watson calls this approach patient engagement, and it blends regularly updated content, social media and reorders.

“So for diabetic patients, if you know an item on an order is for diabetic test strips, you could provide educational information to help that patient improve their condition,” she says. “You can educate and more deeply engage with that patient based on the data that you see from them ordering. That’s really the nirvana of where we plant to go.”

Turning Toward the Future

And looking ahead, toward that nirvana, one has to wonder: will there ever come a time where providers can work with patients and referral partners to conduct funded transactions entirely online? Could a physician create an order, document medical necessity, and electronically give that to a patient who could then work with the provider to order the DME and make a claim?

It comes down to the right partnering, says Dennis Olsen, the Durable Medical Equipment Program sales manager for ARI Network Services, another company that specializes in creating web sites for the DME industry.

“Well, there are already companies out there that do the insurance billing,” he says. “If we can partner those capabilities up to an online version where a consumer or patient or referral source has the ability to log into a web site of their choice, and then place the order for the patient through a secure socket layer, that is the wave of the future.

“And when I say ‘wave of the future,’ I’m not talking 10 years from now,” he continues. “It’s probably within a couple years’ reach for us. And that is something that will make everyone’s life easier. … The referral source will be able to log in and be able to take care of it with the customer right there, and then the provider would be able to take care of getting the product to them and processing the insurance payments through the same system.”

That sooner-rather-than later scenario is tantalizing to say the least, but in the meantime, providers need to determine a web plan that is going to work for their business, and ensure that the site provides all the tools and information that is going to attract and then engage with patients. At the end of the day patient relationships remain the focal point of the business.

This article originally appeared in the February 2014 issue of HME Business.