Software Update: Creating Internet Solutions for HME

In an emerging world of everything .com, it is only a matter of time before the home medical equipment (HME) industry recognizes the value of the Internet. Hewlett Packard has already begun its movement toward direct med-surg supplies sales on the Internet, not waiting to get "Amazon-ed" by its competitors. As managed care continues to scrutinize every dollar spent on health care, the need for the HME industry to search for greater efficiencies in delivering patient supplies does not go unnoticed. Furthermore, with the surge in patients requiring some form of HME and the reduction of coverage by many payor sources for such services, the retails segment in HME grows. E-commerce of HME products has begun. Certainly, as the Internet generation gets older, the shift in paradigm to utilizing cyber-space for product fulfillment will drive the numbers up.

Going On-Line

The best way to demonstrate the value of the Internet is not to present an article that is based upon theory or abstract ideas. Instead, it is a step-by-step process of how one manufacturer/distributor/retailer of a specialty bed-rail system has created a web site that caters not only to the retail sector, but to distribution channels as well. The textbook that is required for this journey will be your Internet browser and a connection to the World Wide Web. Point your browser to Uneek Concepts and follow along as we review the process of transforming a traditional HME business to an e-commerce one.

The process of developing a web presence typically begins by selecting a technology partner. Uneek Concepts chose Automated Design Concepts. The technology partner must have a good basis in web development skills as well as e-commerce capabilities. However, it is equally important for the technology vendor to understand the industry associated with the business. As will be apparent later in the article, this relationship between web developer and medical manufacturer/distributor/retailer proves invaluable to the success of the site.

Getting Started

From the home page or initial point of reference to the web site, Uneek Concepts has many of the standard options that should be included in any web development. This includes a product overview, company information and a method for an interested party to contact Uneek Concepts. By selecting the "Mailing List" option from the home page, the user has the ability to enter information about themselves and request more information. This information is then transferred to a data records which is attached to an email and forwarded to the sales and marketing department at Uneek Concepts. This creates the basis for lead generation and further follow up. The lead information currently emailed to Uneek Concepts may be translated (imported) automatically into the various lead management systems, allowing data imports. The company has selected ACT from Symantec as their contact manager for managing lead contact and follow up, which includes a data import feature.

Product information and content is extremely critical for a web site. This information should be treated just like any other advertising medium utilized by the medical supplier. Web development companies have the ability to scan in photographs of the products. In some cases, video clips may be utilized to demonstrate product usage. Even Microsoft PowerPoint presentation with audio clips may be included in web sites to offer a "walking tour" of products, their features and benefits. The real trick is to insure that the volume of graphics and special effects do not become so large that they distract the person visiting the site or take too long to load into the browser.

Purchasing and Paying

To address retail orders of the bed-rail products offered by Uneek, a separate option is available from the home page (your browser will read http://mall.automateddc.com/uneekconcepts/ListItems.asp). When ordering products, a shopping cart arrangement is typically involved for the selection of various items desired. This shopping cart is nothing more than an order form which tracks the various items selected until it is time to pay for the products. Once the items have been selected, the method of payment needs to be entered. (If you are following along on your browser, it is okay to enter the payment page - you can still cancel your order). It should be noted that upon entering the payment-processing screen, which will ask for the appropriate credit card information, a secured symbol was presented on the web browser. This secured symbol indicates that you have entered a secured socket layer (SSL). An SSL site simply means that all information that is transferred over the Internet has been encrypted so that no other person can see the data being entered at that moment and time. SSL is widely used in retail web sites and is recognized by the federal government as an accepted encryption methodology for the movement of sensitive patient health care information as well as financial transactions.

At this point, the web development process for e-commerce may take two forms. First, technology is available to check a consumer's credit card during the actual transaction process (known as real-time transactions). This is accomplished by contracting with one of several vendors capable of on-line credit card transactions. Vendors such as VeriSign and CyberCash are two such vendors. Employing these vendors requires a special merchant account with a MasterCard banking institution. This account is separate from the traditional credit card account that would be recognized by a credit card swipe machine at a retail store. The advantage of a merchant account is the credit card transaction is directly processed and credit card eligibility verified electronically without human intervention. When the product is actually shipped, the owner of the web site simply "releases" the actual transaction processing from a special screen provided by the merchant account vendor.

An alternative method for online credit card transaction, and the one selected by Uneek Concepts, is to allow a traditional credit card transaction to take place. In this process, credit card orders placed online are stored in a secured "back office" database. This database is only accessible by the owner of the web site on an SSL connection. When an order is placed at the web site, a simple email is sent to the owner of the web site indicating that orders are pending in the back office. Once Uneek Concepts is notified of pending order, they can access the secured, password-protected site and review the orders for processing. These orders can be translated into a database which will eventually be electronically imported into Uneek Concepts' order entry process (just as leads will be into ACT). Many accounting and order entry vendors are now developing systems that allow electronic orders to be imported directly into their information systems. Again, this is a critical component in reducing costs in the overall process of e-commerce. The goal is not to type the information twice if at all possible. If the information needs to be typed twice, there is less cost savings than e-commerce transactions which can be transferred from the web to the inventory control and billing systems electronically.

Managing Distribution

Even more important to Uneek Concepts was the ability to manage distributor orders via the web. An option from the home page was added to a password-protected site for distributors (the web site is not available to view for the general public). Uneek Concepts has the ability to manage each distributor with unique wholesale pricing the products. Payment terms and shipping options are also available once the distributor has entered the secured site. Depending upon the payment method, a credit card transaction may occur or an order is generated invoicing at a later date. Again, an email message is sent to Uneek Concepts indicating that distributor orders exist in the "back office" database, pending fulfillment.

Promoting the Site

The real trick to a successful site is in the promotion that is done to drive traffic. Certainly the site needs to be registered with the various search engines such a Yahoo and Lycos, but that is not enough to ensure success. Automated Design Concepts assisted Uneek Concepts in developing a print and email advertising campaign that included referencing the web site and special promotional discounts for products during an introductory phase. Bottom line to the overall development was that Uneek Concepts now processes approximately five orders a day for products and spent less than $5,000 to develop the entire site including the first year's hosting fees.

Uneek Concepts' web site is a practical example of how the Internet can provide an extension to a traditional medical sales operation. There are many other uses for medical product sales on the Internet. For example, special secure order sheets can be developed to be seen by case managers or managed care networks only. These order sheets can translate into deliverables that can be processed at third party insurance carriers via the Internet. Customer service can be expedited by use of the Internet. By connecting fulfillment status reports to the web page, the medical equipment supplier can afford his customers up to the minute information regarding when a delivery will be or has been made. The possibilities are endless, which should make the web a high priority for your business as well. Remember - don't get Amazon-ed.

This article originally appeared in the November 1999 issue of HME Business.

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