Diabetes provider gambles on growth

Wednesday, May 25, 2011

CHATTANOOGA, Tenn. - While competitive bidding has many providers hesitant to make plans, Mike Eberly is rolling the dice.

The CEO of Care 1st Medical Solutions, a mail order provider of diabetes supplies, in May secured a credit line of up $1.6 million to grow the company.

"We think competitive bidding is going to be significantly changed or delayed," said Eberly. "We are taking advantage of the opportunity to grow while others are sitting on the sidelines."

To do that, the provider plans to double its marketing efforts including TV advertising, direct mail campaigns and lead generation. It is also seeking to contract with private insurers--it currently bills 100% Medicare.

The five-year-old Care 1st serves about 13,000 active patients nationally and will do "whatever it takes" to separate itself from the competition when it comes to customer service, said Eberly.

"If they are looking for a recipe, we will look it up, print it and mail it to them," he said. "It takes an extra five minutes but it makes them a customer for life."

While the provider dodged Round 1 of competitive bidding, about 10% of its patients are in Round 2 bid areas.

"We will submit a bid that we know will allow us to stay in business," said Eberly. "We know what the numbers are so that's what we'll submit and hope for the best."

In order to comply with Medicare's rule that bids must be based on offering brands with at least 50% market share, Care 1st is looking to expand its line of meters. To keep costs down, the provider had focused on a few core brands.

"It makes us highly efficient," said Eberly. "We do sometimes lose patients because of that, but it makes the process simpler for us."

Other product lines the provider is looking at adding include catheters and retail products that are a good fit with its customer base.