O&P, soft goods prepare for break out role

After existing for years on the margins of home medical equipment, the orthotics and prosthetics (O&P) segment is now front and center, thanks to the U.S. Congress.

The Prosthetic and Custom Orthotic Parity Act of 2009 (H.R. 2575), introduced by Rep. Robert Andrews, D-N.J., in May is intended to elevate custom O&P coverage with other basic medical services. Groups such as the Amputee Coalition of America have been pushing for greater orthotic and prosthetic recognition from the payer community for its constituents, an estimated 2 million amputees nationwide.

If the bill becomes law, it could have a rejuvenating effect on the O&P market, say representatives from Charlotte, N.C.-based BSN Medical.

“It would be a tremendous benefit if legislation passes for coverage of custom orthotics and prosthetics and mandates that insurers include this under major medical,” said Pattie Kaczala, BSN senior medical education adviser. “Presently, there is minimal reimbursement, if any, for a custom-made compression garment. The few insurance providers that offer reimbursement will barely cover the dealer's costs.”

As it stands now, payment inequities make the O&P category a hardscrabble business, observers say. Providers who work in this domain, as well as soft goods like compression garments, must pay close attention to the types of products and services they furnish to clients, said Tom Musone, marketing director for Cuyahoga Falls, Ohio-based Julius Zorn.

“Most fitters will try to fit a patient into a standard garment due to cost - we see our dealers looking for a product that will keep the patient compliant and keeps the referral source happy,” he said. “Because patients wear these products every day, they need a product that is aesthetically pleasing, comfortable and breathable, and durable enough so that it won't tear or get a hole. It also has to be machine washable.”

In the absence of greater coverage for custom-made products, Kaczala says there has been steady growth for cost-effective ready-to-wear products.

“A well-experienced fitter knows that custom-made can be the best choice for many patients,” she said. “But in these economic times, the money and costs associated with a compression garment plays a bigger role in the patient's decision to purchase. At the same time, a fitter working in a busy showroom may not have the time to fully explain the benefits of a custom-made garment versus ready-to-wear. It is one thing to sell socks - we are selling compression according to a patient's lifestyle, diagnosis and therapeutic needs.”

Lisa Wells, North America marketing communications manager for Peachtree City, Ga.-based Sigvaris, says the company has seen the number of providers of compression garments climb.

“There is a growing interest among providers for the revenue opportunities that compression therapy sales provide, as many are cash sales,” she said. “We certified more than 600 fitters last year. As patient awareness increases along with skilled retailers who know how to properly fit compression therapy garments, we believe providers that emphasize the fashionable options available in today's compression therapy lines will receive increasing, ongoing revenue opportunities in cash and reimbursement sales from a growing number of repeat purchases by existing and new customers.”

awareness grows

Just as greater awareness of sleep apnea has benefited the sleep market, heightened public recognition of deep vein thrombosis (DVT) can do the same for compression hosiery, Musone said.

“The compression field is expanding as baby boomers age and awareness of venous disease and lymphedema become more familiar to medical professionals and patients,” he said. “HME companies are also more inclined to sell compression now as they look for additional revenue sources without a heavy capital cost to the bottom line. Most states and health plans differ for reimbursement, and Medicare will only pay for a knee-high, 30-plus mmHG (pressure rating) stocking after an ulcer is healed.”

Federal health officials are promoting the gravity of DVT and pulmonary embolisms in recent initiatives. In September 2008, the Surgeon General issued a “call to action” for lowering the number of DVT and PE cases, which currently affect between 350,000 and 600,000 Americans each year. Together, the Surgeon General reported that DVT and PE contribute to approximately 100,000 deaths each year.

In June, CMS announced that Medicare would no longer cover a DVT or PE complication arising from hip or knee replacement surgery as part of its new “Never Event” policy aimed at hospitals. Under the regulations passed last year, Medicare will not pay for complications deemed to be the hospital's fault.

Still, BSN officials contend that more emphasis needs to be placed on leg vein issues and recommend providers hold promotional events, such as Leg Health Day and leg screening with a photoplethysmography (PPG) machine.