Computer Software Update
The purchase of software can be a difficult task, especially because it is one of the most significant business decisions that you will make. The right software or technology solution can lower DSO, improve productivity, reduce costs and boost morale playing a significant part in driving your business. The wrong decision can be a disaster.
Major considerations should revolve around the functionality of the application, the operating system and database software, the stability of the software vendor, support, the vendor's long-term plans, training and implementation services, the level of satisfaction of their clients, and availability of technologies such as document imaging and bar coding. Although all of these factors might not be important today, as your business grows, they will be.
The following are some of the issues that should be taken into consideration in evaluating the software and vendor to hopefully avoid making the wrong choice.
What is the difference between a billing system and a management solution?
Many software packages being sold into HME and the infusion pharmacy market are no more than glorified billing systems with some additional features the vendor treats as secondary in importance, like "inventory control." In most cases, the software vendor has determined that the core business of an HME or infusion provider is to bill. We all know that this is not just incorrect, it is insulting. Billing is the end result of what we all must do, and providing quality patient care by supplying products and services is the reason the business exists.
Despite the focus on billing, vendors need to understand the entire operational needs of a provider, and this can result in a situation where whether or not you get paid the first time a claim is submitted can be hit or miss. A true management solution will have built in checks and balances to ensure that all departments are completing required tasks so that only ?valid? orders are shipped and the claims submitted will be paid. From patient intake, to order entry, to billing, nothing should fall between the cracks that is necessary to provide the patient with the required products and services, and ultimately allow you to get paid.
A management solution will go beyond billing and will impact virtually every aspect of your business including; managing the clinical record, providing access to management and marketing data for better decision making, inventory and purchasing, dispatching, customer service, accounts receivable and collections, equipment maintenance, pharmacy operations and your retail store, if applicable.
A true management solution incorporates the latest technology; document imaging, point of care, bar coding, electronic interfaces for connecting to third party products, and is provided by a company committed to keeping abreast of and making the best use of technology changes.
Why is there usually a significant difference in pricing between systems?
Much of the price differences relate to the billing vs. management solution discussion outlined above. To develop a sophisticated system that encompasses all of the many aspects of the total operation, a provider may require the vendor, to invest millions of dollars every year verses thousands of dollars for a typical billing package. When it comes to pricing, most of the time you get what you pay for, not just in terms of functionality and benefits of the product, but also from the vendor in terms of support, training and other services. One of the concerns a user needs to understand is that low-end systems simply do not justify a high enough price to provide the vendor with the resources to hire the best employees. Throughout the software industry there is a trend in which companies with low end products are not surviving, as they cannot build up the revenue base to make it work. The failure rate among software vendors in this market over the years is significant because on top of all the other challenges, the number of potential HME or infusion clients is limited, therefore the strategy of going after market share (volume) does not apply. Hence their clients are placed at a serious risk.
The difference in software for this market is similar to comparing a Hyundai to a Lexus. Both will get you to work every morning but there is a significant difference in the level of comfort, safety and features. Since there is a significant cost difference to manufacture a Lexus, it is sold at a higher price. In regards to pricing, software is no different than the car, truck, copier, or the equipment you resell. The better products, for good reason, come with a higher price tag. Make sure you are really comparing apples with apples because the feature set in the management system will far out weigh the billing system in terms of overall benefits for the business.
Buying the right software solution can have a major impact on your business. The low cost solution did not meet their needs, especially as the business grew. Ironically, in the long run it turned out to be more expensive due to the cost of the software, training and converting all the data over to the next new system.
Most people do not realize that the cost between the cheap solution and buying a true management solution, when leased, may not even be that significant. Just as when you lease a truck or copier, the real concern should be the monthly cash outlay. For example, the difference between a $25,000 and a $15,000 software purchase on a 60-month lease is only $200 per month! When you factor in the tax benefits that may be available to you this number can be reduced even further. When factoring the appropriate deductions, your out-of-pocket costs can be as little as 60 percent of the purchase price. Even still, is it not worth $200 a month more to have the same software and technology that some of the major providers are using to their competitive advantage?
Is there a significant difference between different vendors software support, training & implementation staff?
Getting quick and accurate assistance from the vendor is key in making the implementation of a new software management solution a success and receiving the most benefit out of the software. A key issue is whether or not the staff has worked in the industry and truly understands your needs. You do not want to be training the software vendors staff on reimbursement in order to get your problems solved. You also want a vendor that will send out people with substantial industry knowledge to help you plan the implementation. Some vendors do not even offer this service.
Access to their help desk software over the Internet, Internet-based training courses for new employees and product enhancements, advanced communication systems for routing calls to the most appropriate customer service representative, are just some examples of the things that make a difference and you should look for these services from your software vendor, before purchasing their software. Also, check to make sure the support fees you are being quoted are all inclusive. Some vendors charge extra when there is a major update.
If they advertise Windows does that mean Microsoft Windows?
No! It is not the Microsoft Windows that we are all familiar with on our personal computers. There are some companies that are using Microsoft Windows but only as a front end to a legacy DOS or UNIX system. Having a Windows front end such as order entry or patient intake talking to a UNIX based billing module means two operating systems contending for the same resources. This will tend to slow the system down, even to the point of freezing the program, and is much more difficult to support.
Should I wait for my present vendor to release their next generation of software products?
You have probably been hearing for years from your present vendor of their impending plans to release a Windows or NET system. Even if they finally do release a product, there are several very important issues to consider. Will the new product have all of the features you presently have now? What happens if they decide to stop support on your existing system or version? They are heavily advertising their new product (which is not yet available for HME and infusion). How many have they actually sold over the last few years? This same concern should hold true for many of the other vendors as well.
Lack of functionality in their new products should be one concern; the other is how well they can support their new product. Moving from a DOS or UNIX environment to supporting Windows or .NET products requires a major change and tremendous practical experience and knowledge. Will they have the expertise and experience that it takes to properly assist you in this new environment, that to date have not had to support?
Does it matter where the product is developed?
Absolutely. In an effort to bring products to market quickly, a number of vendors are outsourcing their product development efforts to countries like India, Russia and China. While they have some very talented people, they will not have the exposure to HME, infusion pharmacy, or home healthcare agency operations. As a result, they tend to copy the vendors existing DOS or UNIX product with the intent of just giving it a new Windows look and feel but fail to add new functionality and technology. However, support is handled by the U.S. staff that does not have the intricate knowledge of how the product was written, making it difficult to support.
Understanding the flow of software and its functionality to see that it meets your needs should carry significant weight in your decision.
This article originally appeared in the June 2005 issue of HME Business.