Wound care veers toward cash market

As the reimbursement landscape becomes more difficult, HME providers committed to the wound care market are apparently turning to cash sales as a way to boost to sagging revenues.
Market specialists believe that independent HME providers are well positioned to compete against the big box stores and, in fact, many are committed to helping those same providers succeed in the space.
For instance, Raleigh, N.C.-based Domtar is committed to selling their Discreet line of incontinence briefs and other products exclusively to independent retailers, such as pharmacies and HME outlets. Brand manager Chris Lee says this strategy is critical to building a loyal customer base and strengthening the supply chain for medically oriented retailers.
“We are seeing the emergence of a cash market and we are dedicated to our independent retailers—we don't sell to big-box stores,” Lee said. “The customers for our product are very loyal and they will make a special trip to get it.”
Although not technically a “wound care” product, skin irritation from incontinence is a major cause of wounds and should be an integral part of any retailer's wound care portfolio, Lee said. Breadth of choice for styles and sizes is also paramount, he said.
“This is important because you will be able to provide products to everyone who comes in,” he said. “Independents don't have a lot of inventory space and we understand that. The national brands are in bulky packaging with large case counts—we've made the case count smaller so you can fit more within the space available. The small bag count also allows customers to try different products at a lower cost and it ensures they will be coming in more frequently.”
Indianapolis-based CMB Solutions, a patient engagement specialty firm, is counting on elevated retail sales as a springboard for HME providers to establish closer connections with customers.
“We are definitely seeing an increased trend toward cash items and HME's online storefronts for generating those cash sales,” said Nyika Wright, COO and executive director of CMB Solutions. “With our platform, HME providers can integrate even their online orders or utilize our branded patient portal for centralized order management. Then we send directly to fulfillment on their behalf.”
UPSELLING POTENTIAL
Developing an extensive knowledge about each patient's condition and product needs is essential to boosting sales, Lee said, offering this example: “We have learned that most incontinence patients use two different types of products—we recommend selling them their preferred garment with underpads for extra protection. We have a wipe display at the point of sale to raise awareness and create an 'a-ha' moment as a cross-selling item. It has a lot of potential.”
CMB calls the concept “upcaring” and feels it can be applied to myriad supplies, such as gloves, wipes, disinfectants and skin care products that are complementary to wound care items, Wright said.
Patient preferences are also trending toward quality over price, she said, enabling more revenue opportunities for providers across the category, from incontinence garments to wound dressings to support surfaces.
“When costs are cut and inferior products furnished by the provider, the patient does notice and communicates that through us,” Wright said. “Fortunately, in most instances, the providers are willing to make the change for their patients.”
To help providers assemble product bundles with complementary items, Domtar has developed the Discreet starter kit, including a four-foot planogram, shelf displays, a single SKU and box shipment.
“It can be expanded based on sales,” Lee said.
FINDING REFERRALS, CUSTOMERS
As with all HME categories, the key to growing clientele lies with finding the right referral sources and wound care has an abundance of them, sources say. Besides clinical professionals in internal medicine, urology and nephrology, there are numerous support groups and associations, such as the North American Center for Continence, American Urological Association, and the National Alliance of State Prostate Cancer Coalitions.
“There are a few independents in Florida that are partnering with mobile home communities to be their No. 1 source for referrals—they are pounding the pavement and knocking on doors,” Lee said.
Wright also recommended that providers seek out clients located in institutional settings.
“It seems the HME provider could make more use of marketing to (skilled nursing facilities, assisted living and hospice),” she said. “From what we've seen, they serve the patient source—not the facility per se—but perhaps a handful of patients at a single facility.”