2016 HME Handbook
How to Tap Into Orthopedic Market Opportunities
Some key considerations for providers looking to expand their revenues through orthopedics.
- By David Kopf
- Jun 01, 2016
As providers work to expand their revenues, one long-standing product
category provides a good mix of retail and funded revenue while also reaching a wide range of
patient groups. That category? Orthopedics.
When it comes to funded items, orthopedic goods often meet the criteria for reimbursement,
and are more often covered than not when prescribed as medically necessary. Also, when
orthopedics are prescribed, there are many complementary items providers can sell on a retail
basis along with the funded products to increase their profits. For instance, when a patient is
prescribed a knee brace, the provider can suggest custom orthotic shoe inserts, heating pads,
analgesics and knee wedges, and then sell those items on a cash basis.
When selling orthopedic goods on a retail basis, it’s important to keep in mind that the
demographics of people that need these offerings are considerable. Thus, the argument to offer
orthopedic products becomes even stronger. And, as that population ages and people that are older
remain active longer, an increasing number of those people require some type of supports and
braces to help maintain those active lifestyles, as well as to prevent and treat minor injuries.
Clearly, as an HME category, orthopedic products represent a revenue opportunity that providers
can’t ignore, because, in addition to its revenue potential, offering orthopedic goods lets them leverage
existing patient relationships and their ability to develop their teams’ in-depth product knowledge.
Bearing that in mind, let’s examine some key considerations when it comes to offering orthopedics:
Understand the market. There are a wide variety of patient groups that are
served by orthopedic goods: rehab patients, customers who are recovering from
injuries, people suffering from sports injuries, athletic clients that need special
support, post-surgery patients, maternity patients, and geriatric patients. Each of
these patient groups need specific items. For instance athletic patients could need
wrist, ankle, and knee braces, back supports, or, if they’ve suffered an injury, they
could need ice packs, or slings.
Understand demographics changes. A key patient segment for orthopedic
goods is the Baby Boom generation. There are 10,000 people turning 65 every day,
and those Boomers are not like the retirement age population that came before
them. They are a key group that will need orthopedic products, and perhaps not in
the ways provider might initially predict. As an age cohort, Baby Boomers are more
active and are engaged in a number athletic pursuits and recreational sports. Sports
therapy and athletic orthopedics represent a key category for this patient segment.
Moreover, the Baby Boom is an age group willing to pay for items if they can’t get
them funded. If a retail product, such as night splints, wrist splints or patellofemoral
bands, can help a patient contend with nagging pain that diminishes their quality of
life, Boomers will be willing to pay for it. Moreover, getting back to sports-related
products, Baby Boomers are willing to buy them on a cash basis, as well, especially
if that item can help them enjoying an active lifestyle. This is a patient group that is
willing to be self-funded when it comes to getting what they want or need.
Prioritize product options and knowledge. There are a wide array of
orthopedic solutions to suit various patients and conditions. The provider business
must ensure that it provides adequate inventory of key solutions for patients, and it
must also ensure that its staff is well versed on those products in terms of features and
benefits. If your vendors offer any kind of product education, take advantage of it.
In terms of stocking your shelves, it’s key to have the products arranged by
patient need and to ensure that everything is adequately stocked, not just in terms
of type, but also size, color and style where applicable. Make sure to provide
helpful signage that can help patients find what they need, and offer as much
in-store product education through displays, posters, brochures and similar
offerings. The more education you can provide, the better.
Provide consultative sales and service. Providers serving orthopedic customers
must implement consultative sales and service. The range of orthopedic options
can be staggering, and understanding their applicability to various conditions is
critical, because it is very likely that customers will be confused by the wide spectrum
of product choices. This puts providers in an excellent position to leverage their
expertise to truly help a patient and establish a solid and lasting relationship.
One of the key ways a provider can start that process is to simply listen and
ask open-ended questions that can get the patient to open up about his or her
condition and describe his or her problems in detail. Once you have a solid sense of
the situation, you can start to make recommendations.
Work to educate referrals as often as possible. When it comes to helping
orthopedic patients with funding, your physician and other healthcare partners
aren’t going to be able to come to your store, so make sure to take your product
knowledge to them. Work to meet with and educate orthopedic doctors and
surgeons and general practice and rehab facilities so that you can share your
expertise and the services and products you provide and the sorts of patients and
conditions you can help.
Consider orthotics as an on-ramp into orthopedics. As a cash sales
category, orthotics represent a solid way to increase retail revenues, since many are
sold on a retail basis, and because they appeal to a wide variety of patients. The
learning curve is also not as steep as some more complex orthopedic offerings,
and the vendors of these solutions offering good product training and information,
as well as good merchandising resources, such as displays and retail friendly
packaging. Moreover, many patients that might need orthotics also might need
other DME, related supplies, and, of course, additional orthopedic products.
Points to Remember:
- Orthopedics represent a massive market, including groups such as rehab
and post-surgery patients, sports injuries and customers who need support
for athletics, and geriatrics, to name a few.
- One key demographic that is altering orthopedic assumptions is Baby
Boomers, who are remaining much more active later in life, and are broadening
the orthopedic needs of older patients.
- Providers should strive to ensure in-depth product knowledge on the team
and foster a consultative sales and service approach. Strive to educate not
just patients, but referral partners on what’s available.
- Make sure to stock a wide range of products for the patient groups that
your orthopedic practice will serve. Selection is critical.
- Orthotics offer a good entry point for exploring the orthopedic market
since they serve so many different types of patients.
- Both the major member service organizations in the industry, VGM Group
(vgm.com) and The MED Group (medgroup.com), have resources for
providers interested in orthopedics and orthotics. The VGM Group’s Retail
Services offers expertise in the category, and the MED Group offers a
Rehab & Orthotics Network. And of course both groups offer products to
members via their buying groups.
This article originally appeared in the June 2016 issue of HME Business.
David Kopf is the Executive Editor of HME Business and DME Pharmacy magazine. Follow him on Twitter at @postacutenews.