2011 Big Ten

Computer Software

HME software systems and services have become essential strategic assets for competing in 2011.

• By David Kopf
• Jan 01, 2011

How times change. Just a few scant years ago, a sizeable number of providers did not consider computer software an integral business asset. Many providers regarded homemade spreadsheets and a copy of QuickBooks as a perfectly suitable system for staying on top of their finances and business operations. Not any longer. That image of cobbled-together technology workarounds has quickly faded into obscurity and now HMEs are technological savvy businesses that are constantly on the hunt to maximize their technology to gain the biggest business benefit they can.

Why? Because Medicare’s funding and regulatory environment has demanded they do so. Given the 9.5 percent funding cut providers had to accept, the 36-month oxygen rental cap, accreditation requirements, pre- and post-payment audits, as well as the recent removal of the first month purchase option for standard power mobility and the implementation of Round One of competitive bidding, HME businesses have been forced to pursue cost-cutting business efficiencies with an almost maniacal monomania.

No business asset helps providers do that better than their HME software systems. HME software has gone beyond simple billing and claims processing to a strategic tool that can give a provider the edge in just about every aspect of its business. The past two or three years have demonstrated this conclusively, and with the tough funding landscape laid out before providers for 2011, they will need every bit of help they can get.

Some key software benefits that should become standard operating procedure for any provider this year:

Inventory management is a critical element of provider businesses. The money they can have tied up in inventory can be monumental, and if that inventory doesn’t move, that is capital that leeches off the bottom line each and every month. Inventory management capabilities can introduce cost-cutting efficiencies such as barcoding into warehouse operations, while modeling inventory to ensure providers keep the right amount of DME and supplies on-hand. Moreover, software can automate re-ordering to ensure adequate stocks.

Another aspect of HME operations that represents significant overhead is delivery management. With software, providers can optimize their routes to maximize mileage and delivery and repair call efficiency, as well as ensure the best possible emergency response. Throw GPS into the equation and providers can track their drivers in real-time right down to their speed and mileage.

And let’s not forget billing and claims. Still an essential part of HME computer systems, claims and billing functionality lowers providers’ DSOs and ensures clean claims that won’t get bounced back. Also, some systems can do batch processing so that providers don’t have to endure the frustrating process of Medicare’s dial-up billing connections.

As providers also emphasize increasing their cash fl ow due to decreasing Medicare margins, retails sales has become a key way to bring in new revenue. Here again, cash sales can help. Point of sales systems can be tied to the back office to update inventory as items are purchased, as well as track patient buying habits, and accommodate special promotions. Also, by using POS systems providers ensure quick, smooth transactions that feel like the retail shopping experiences patients are accustomed to.

One major hurdle every provider faces is Medicare audits. CMS has emphasized these nasty funding hurdles with an emphasis in 2010 and will continue to do so during 2011. Because of that providers must need to implement their own internal processes to assess claims before they are processed to see if they will pass muster. Software can automate this process for them.

In that vein, document imaging and management have also become essential software tools. They help providers quickly store, file, share and retrieve any important documents related to a specific claim or patient.

Also important is how providers leverage the information they amass through all these processes. Many HME software systems now feature special “executive views” or “dashboards” that digest a profound amount of data to give HME business owners and operators a bottom-line view of how their business is performing based on a set of metrics they define. Furthermore, they can drill as deep into that data as they like through reporting tools to troubleshoot why a certain aspect of their business might be performing poorly. Similarly, they can drill-down to see why another aspect of their business might be performing well, and see if that success can’t be spread to other departments.

If you have not given your software systems the attention it needs in the past, 2011 is the year in which you will. Not only will the funding environment force your hand to do so, but so will any of your competitors that already have savvy software strategies in place.

This article originally appeared in the January 2011 issue of HME Business.