Dealers Discuss: Kathy Weiher, Manager, Respiratory and Retail Services, ThedaCare At Home

What is the background of the company?
ThedaCare At Home is based in Appleton, Wis. In 1994, the company was a small independent pharmacy that started home infusion and then ventured off into the HME market. In 1995, I came onboard. Through the years we were acquired by a hospital-based system that was inclusive of HMO physician offices and an HME portion, which was inclusive of skilled care and hospice care. Our specific services are skilled nursing, hospice, HME, clinical respiratory, home infusion, residential hospice and in-patient hospice care.

How big is the HME part of it?
I believe right now, in terms of revenue, it accounts for about 50 percent of business, and we also do rehab. I am not sure there is anything we don’t do!

Who are your typical customers? How many people do you assist in a week/month?
We service about 4,000 customers a month. Our typical patient can be anyone from a neonate coming out of the hospital to a 102-year-old grandma. It’s hard to pinpoint. One area we’ve seen grow substantially has been our sleep business — which I don’t think is the typical type of patient because it’s your average 45-year-old, blue collar worker who is working in the mill and has had no health care issues. The dynamics are all over the board. I definitely feel we’ve changed more significantly regarding the “average Joe” patient.

What’s the biggest part of your HME business?
Our sleep part has almost caught up with the rest of our respiratory program revenues. The increase has been a bit more sluggish in the past 12 months than it was in the previous 24 to 36 months. We’ve seen 20-30 percent growth in back-to-back years; so, it has significantly impacted the number of customers we’re servicing. Now (the sleep portion) has really started to gain momentum with how it competes with the rest of our program.

Part of our hospital-based system has its own sleep center; so, we work intently with that lab but we also work with other labs in our community.

Are you seeing continued growth?
As a whole, we’ve seen some increases in the last year. Probably, we haven’t seen the significant growth that we had seen in the previous two years.

Why did it slow down?
We have a lot of strategy meetings about that. I think the payor market has changed significantly. We used to be in a very heavily HMO market, and I think the consumer in an HMO mindset says, ‘Well, I have an HMO. You’re supposed to cover it; so, I shall buy (what I need).’ But we have seen most of the HMOs leave our market. Now there are a lot of changes in insurance plans with reduced benefits for HME; for example, some plans in our community max out at $1,500. Then if you buy a CPAP, you’re maxed out. So, the patient may not come back for the replacement supplies like they should.

The consumer is taking much more control of (his or her) health care dollar, which isn’t such a bad idea. I think the consumer is being much more thoughtful. There are a lot of health savings accounts programs the community uses, and they are saying, ‘How do I want to use my health care dollars, and do I need that mask replaced right now?’ It’s a totally different shift in the consumers’ minds as to how they spend their money.

What steps are you taking to help your business grow and thrive in the next year?
The strategy is always to maintain quality and to make sure, as you look at your processes and programs, that you are not going to compromise that. The consumer has a lot of choices. Our strategy is to encourage consumers to spend their dollars with us. We don’t want them to base their decision only on price. We want to try to educate the community as to the value of its dollar and why (consumers) should choose us. So, quality is number one and you have to continue to look at it.

As you continue to grow you have to keep your expenses in line. Continued growth does not necessarily mean that you can grow resources. How do we work smarter rather than harder? It’s really about looking at processes. We use the same tools that Toyota has used for over 50 years for our quality improvement. There’s a whole philosophy as to how we approach change in this organization. The key points are really about driving waste out of the processes so you can increase the value-added tasks in the processes. Then, they are going to be more meaningful, not only to patients but particularly to your staff. Staff (members) don’t like doing tasks that aren’t necessary. We get staff in a room, figure out processes, figure out where the waste is and we implement new ones. It’s been a totally different shift in the way we approach change.

What are some of the other challenges you face in your day-to-day business?
Just like any other provider, it’s anything from staffing to inventory; it is about working through it. One thing we’re really good at in our industry is adapting to change and figuring how to get it done. We can’t wallow in a corner; we just have to push forward and make things happen.

What is the role of RTs in your company?
I am an RT by background, so when I came onboard I had a lot of thoughts about how an RT could support an HME business. From day one we’ve had a very strong clinical focus, making sure we’re utilizing RT skills. We do a lot of disease management. We figure out how we can get that RT and the patient to connect to create best outcomes. And that does become the challenge sometimes. We recently moved to a model where the RTs are not setting up the equipment. We finally realized we had service techs that are great at education. We put forth a lot of effort in getting them to now take over oxygen. The RT does follow-ups and looks at disease processes and how we can achieve the best outcome.

On the sleep side, there are 10 RTs employed. Half are committed to nothing but sleep therapy. This program has grown so much in the last two years. There’s a lot of education that goes on in the treatment room, a lot of troubleshooting, a lot of hand holding and a lot of psychology.

What do you think about the impact of the proposed 36-month cap on oxygen and the transfer of ownership?
When you risk cuts in reimbursement, you have to be concerned about it. We are concerned, and we’ve been studying the data. We’re trying to figure out how we can best supply these patients long term. We have to evaluate our patient base and our efforts moving forward.

Are you worried by the prospect of competitive bidding?
Absolutely. I think that you know as you go into bidding where you’re going to bid, but what’s scary is not knowing what the guy down the street is bidding and the one next to him and what they are willing to do in order to get the bid. I am hoping we’re all very thoughtful and we’re all watching each other’s back in doing the right thing and getting the best reimbursement we can.

What made you choose to get into this business?
I think part of it is my allegiance as an RT. We’re jacks-of-all-trades and we’re very adaptable people. I think part of it comes from my personality — I like change, which is essential in this business.

Where do you think the company will be in the next two to three years? What about the industry as a whole?
Hopefully, we’ll be as strong as ever. I’m hoping we’ll expand our wings and maybe tap into a few areas we haven’t been. Our mission as an organization is to improve the health of our community; so, it’s about figuring out how best to do that.

I’m hoping we’re still making a profit, and hoping as an industry that the changes we’re facing and going through will somehow make us stronger. Hopefully, we’ll learn from it, fight where we can fight, but sometimes we may just have to concede. But that doesn’t mean we won’t put up a good fight.

Contact Info: Thedacare At Home, 3000 E. College Ave., P.O. Box 469, Neenah, WI, 54947-0469, (920) 969-0919.

This article originally appeared in the Respiratory Management Jan/Feb 2007 issue of HME Business.

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