Products & Technology

Point of Sales

Why point of sales systems are critical to a successful retail strategy, and how providers can implement them.

• By David Kopf
• Aug 01, 2010

The tip of he spear can be a difficult place to find oneself, but it’s exactly where providers stand these days. HMEs must find ways to increase their cash flow in order to survive a hard Medicare funding environment, which is why many providers have turned to cash sales as a way to spark a retail revenue revolution, and the point of that particular spear is aimed right at the register. The point where cash transactions occur is the point where long-term customers relationships can be won, or lost. Process transactions in an easy, fast method and customers will keep coming back. Take too long and they’re gone.

To keep retail customers smiling, many providers with cash sales businesses are installing point of sales systems. In general, a point of sales system offers a basic hardware and software platform for processing cash register-type transactions. It includes a PC, usually a touch-screen monitor, a cash drawer, a receipt printer, and a credit/debit card swiper. Some systems also include a customer-facing display pole that shows the customer the transaction totals as it is being rung up. This latter feature can be a legal requirement in some states, in fact.

In terms of availability, Many makers of HME billing and management systems offer POS systems, but providers can also implement third-party offerings.

Fast Cash

Like a Top Gun pilot, effective retailing has a need for speed. Customers want to get in, get what they want and get out. The one key asset that can make sure they get that fast, easy shopping experience is a point of sale system. Likewise, the provider benefits from retail automation in that it drives costly inefficiencies out of the process, it ensures products are properly priced, and inventory is instantly updated. In short, POS systems offer a triple-threat of upsides.

“It’s efficiency, it’s cost, it’s accuracy,” says Gail Zainfeld , Director of Implementation and Training for HME software company Fastrack Healthcare Systems Inc., which offers a point of sale software and hardware module for its HME billing and management system.

What clients are looking for, in a retail sales situation, is a process that is exactly like the cash sales process they are familiar with when dealing with any large box retailer or corner shop: a simple, familiar transaction. HME providers must leverage POS systems to duplicate that experience in their stores.

“The metaphor that we keep hearing is someone is standing in line and wants to buy something like a pack of gum, not a CPAP with insurance,” says Adam Brannon, director of software development for HME software maker Brightree LLC. “They don’t want to wait. Buying that pack of gum should be much easier than an insurance sale. Providers want to make that transaction quickly and securely.”

Also, as part of the speedy retail experience, a POS system should support a variety of payment types, such as cash, check, multiple credits and debit cards, says Jerry Lippincott, director of product management for Brightree.

“A typical DME product has a patient intake process that is wrapped around billing, insurance information and clinical information, which isn’t relevant in a purely cash sale” Brannon explains. “And the other priority is that there has to be loss control.”

In addition to the speed of transaction and enhanced efficiency, another key benefit POS systems offer to providers is security. Now that the HME is going to be handling money and credit card information, it must emphasize protecting its revenue and customers’ financial information, as well as ensuring accountability for both purely accidental errors, and graver circumstances in which an employee might have stolen from the till.

Preventing and controlling loss starts with a locked cash drawer, but quickly scales up. POS systems offer security features such as controlling which members of the team can void transactions, or open the cash drawer even when a sale has not been made. Also, the can require register operators to login and log out in order to authenticate who is using the register and when. Some even include biometric login information, such as fingerprint readers, to make that process fool-proof, as well as faster.

“With a POS system, you’re going to be able to track who is doing what in the cash drawer and when they are doing it,” Lippincott says. “That is going to help you manage the security around your cash intake.” Moreover, these layers of security and accountability could possibly benefit providers in terms of generating documentation that could help them adhere to their accreditation requirements, Zainfeld notes.

That speed and ability to support different payment types means that a point of sales system also can help in billing, says Ron Street, CEO of HME provider Street Home Medical Inc. (Warner Robins, Ga.), which has been conducting a significant retail business for more than 15 years.

“If someone calls in and wants to pay on their bill, it can be automatically posted to their account,” he says. “It doesn’t have to go through three people to get posted. So it saves us some steps and cuts out paper work and people work.”

Systems Integration

A key element in a successful POS implementation is smooth integration. The POS system should “talk” to all the other elements of a HME provider’s technology. For instance, when a sale is processed, inventory should be updated for the sold items. Or, if an existing patient purchased a retail item, then his or records should be updated. Or, if an item that is sold as retail when it can also be funded by private or public payor insurance, that the retail item price is charged to the cash sales customer, as opposed to the funded amount.

Those sorts of functions either require painstaking integration work in order to seamlessly mesh a third-party POS system into the provider’s existing technology infrastructure, or providers can purchase a system that is supported by their existing HME software vendor.

That painstaking integration, can be quite painful indeed given that it requires a considerable bit of duplicate product pricing information entry — once in the HME management system, and then another time in the POS system, Brannon notes. “One of the advantages we hear back is that all of the data is in one place,” he says.

Street advises providers use a POS that is intended for their HME billing and management software if possible. Street recalls after consulting with his IT manager on which telephone carrier to go with, his IT manager advised to go with the company that owned the actually telecommunications infrastructure. Street took the same approach with his POS system.

“I was with Fastrack with my billing, so I went with Fastrack for my point of sale,” he says. “You go with the company that owns the wires.”

That integration also typically fosters enhanced capabilities within the HME management system to support other, special capabilities pertinent to the retail business. For example, a POS system could now mean that the provider is able to stage special promotions for its cash sales business, such as a discount on certain items timed with a particular holiday (“20 percent off aids to daily living during Labor Day weekend,” for example).

Also, another benefit with some POS systems that are part of an HME software system, is that those systems can also function like a regular workstation, Zainfeld notes. “At any time, you can fl ip back and forth from the point of sale to the main HME system,” she says. “So the file maintenance, patient database, product database — everything is totally integrated. So even though you might be in the point of sale, you’re still using all the data fields from the main application.”

Connecting With Inventory

A key element in integrating POS systems is connecting them with the inventory management system. The POS system must be able to deduct or add items from the inventory, so that an accurate count is maintained.

To that end, barcoding is a lynchpin technology in a successful POS implementation. Inventory must be coded and the POS system needs to incorporate a barcode reader that can scan the items so that they are instantly rung up. The POS system will then instantly update the inventory management system when the items are sold to retail customers.

Tying a POS system to inventory management can be particularly effective if the retail floor can be treated as an individual warehouse with the inventory system so that when an item is pulled and sold, it is removed from the retail “warehouse” as opposed to any other location, Zainfeld says.

“The point of sale is great, because it ties in with our inventory,” Street explains. “We’re more efficient with our inventory and it shows the products we need to carry. It tells me the inventory we’re moving so that I can keep it in stock.

“[Linking POS and inventory control] works out perfect, because we’re not in the medical equipment storage business,” he continues. “We’re in the medical equipment rental and sales business. We don’t have to a lot of extra stock. Let your vendors store your extra inventory and keep up with just what you need.”

Also, the scanning of items can be used not just for DME items, but for items have UPC codes if they are tied to the provider’s product database. So, for instance, a pharmacy that sells DME, but also sells all sorts of other items, such as bottled water or OTC health items can ring up those items simply by scanning their UPC, Zainfeld explains.

“It’s simple,” Street says. “With the labeling and barcoding, it’s point-and-click. You just enter in the method of payment.”

Of course, this all requires set up, Zainfeld explains. But in that regard, many vendors will offer installation services to help the provider integrate their POS system into not only their existing technology infrastructure, but also with their business practices. So, providers must consider how they want their inventory set up in relation to retail, or how they want to handle special promotions and sales. That up-front work will make the difference between an easy and a difficult integration, she says.

Likewise, providers implementing POS systems must get employees on board and trained on the systems, but that learning curve is extremely gentle, Zainfeld notes. “It’s pretty simplistic,” she says. “It’s basically pushing buttons. ... Basically, if the database is set up correctly before, then the system is a breeze to use. So as far as getting people up and running, it’s a very simple process.”

Just the same, software vendors typically provide training services for their POS systems. For example, in Fastrack’s case, the company provides on-site training, as well as internet training with live trainers. HMEs are trained on set-up, how to process transactions, and administrative activities, such as setting up employee accounts.

Street Home Medical didn’t require much training to get staff ramped up on its POS system, according to Street. “It’s very easy and very user friendly,” he says. “I came in on a Sunday, and not knowing how to operate the system, I was able to ring up a sale. I don’t want to use a cliché, but it’s so easy a manager can use it.”

This article originally appeared in the August 2010 issue of HME Business.