Prevention, Wellness Bring Growth
- By Craig Firl, Ben Vincent
- May 01, 1999
The health care consumer may be the "forgotten" component of the changing health care environment. During previous decades of generous reimbursements and fee-for-service plans, the health care consumer moved swiftly through life and paid little attention to health care except when he or she got sick. When patients were sick, they went to their doctors, followed their advice and left health care thoughts behind after being cured.
The 1990s brought many health care changes, not the least of which are the demographics and the attitudes of the health care consumer. Today's health care consumers are active participants in health care both before and after problems arise. They not only follow the care plan after diagnosis, but unlike their counterparts 20 years ago, today's health care consumers seek preventative medicine and means to monitor their health to get the earliest possible warning of a potential problem.
Manufacturers of home medical equipment (HME) have responded by giving consumers a range of products to monitor their health and to diagnose some conditions, and consumers are responding.
"(The home diagnostic market) is growing by double-digits each year, and in the past three years we have seen more than double-digit growth," said Tim Sheehan, general manager for consumer and health care divisions at Omron Healthcare Inc., Vernon Hills, Ill.
Not only are today's consumers' attitudes different from their parents', but their demographics have little in common. The 1990s health care consumers are children of post-World War II prosperity unlike their parents, who shopped with Depression-era conservatism. Aging baby boomers created the "material world," and they will spend their high disposable incomes on products that offer benefits and convenience. Reimbursement generally is an issue for high-end products, but boomers are more likely than their parents to spend money on products that will improve their health.
Why the Interest?
Despite the lack of Medicare reimbursement for some products, the home diagnostics market is growing. Manufacturers are answering consumers' and the health care system's demands by offering blood glucose monitors, blood pressure monitors and other diagnostic products. Consumers want to track their conditions to avoid serious problems, and the cost-conscious, managed-care-driven health care system applauds home diagnostics as a means to reduce complications due to delayed diagnoses and doctor and hospital costs from extended stays and frequent visits.
"Home health care seems to be a big market because a lot of people are worried about their health," said Dick Stark, vice president of Medisana USA Inc., Charlotte, N.C.
Home diagnostic products give patients some control over their conditions. By using blood pressure monitors, patients not only will realize as early as possible when they may have a problem, but taking the readings makes them participants in their treatment. Daily blood pressure readings are also a constant reminder to patients to take prescribed blood pressure medications and to follow doctors' orders for reducing their hypertension.
Payers support home blood pressure monitoring because it reduces costs. Patients who regularly monitor at home do not need to go to the doctor's office as often for routine checks. Taking readings from their homes also reduces patients' white coat syndrome, which occurs when blood pressure rises because of anxiety from being at the doctor's office. Sheehan said studies have shown doctors have prescribed unnecessary blood pressure medications after high readings due to white coat syndrome. Home monitoring can produce more accurate, normal readings and can perhaps eliminate some pharmaceutical expenses.
What's Available
Omron's Intellisense blood pressure monitors feature a microchip, designed to provide more accurate and faster readings than traditional blood pressure monitors, Sheehan said. Omron also markets it as easier to use with less user error and discomfort from over-inflation. Its simplicity and comfort increases patient compliance, Sheehan said, and compliant patients are healthier and cheaper.
"We have clinical data that support the accuracy claim," Sheehan said.
Omron soon will release a portable, upper arm auto-inflate blood pressure unit. The one-piece monitor can be attached in one step and is easier for patients to use, Sheehan said.
Medisana USA offers economical wrist-type blood pressure monitors and table-top units. They feature memory, single-button automatic and fuzzy-logic technology.
Blood glucose monitors are also popular home diagnostic products. Chronimed Inc., Minnetonka, Minn. offers several blood glucose monitors for people with diabetes.
"The market is growing with the changes in reimbursement policies for type 2 diabetes," said Angie Howe, product manager with Chronimed. "HMEs and retail pharmacies are purchasing more home diagnostic products."
As technology improves, manufacturers will develop additional home diagnostic products for other conditions. Stark said that later this year Medisana will release the Cardiocheck, which will allow patients to produce an electrocardiogram from their homes. The patient will put a liquid on his or her thumbs, and the machine will give a reading of the patient's cardiac impulses.
In addition to developing new types of monitoring products, technology generally will focus on improving accuracy and convenience of existing products and increasing communication capability between patients and physicians. Internet-based technology is providing communication capabilities that ultimately should blur the distinction between monitoring in physicians' offices and the home. Home Diagnostics Inc.'s Prestige IQ Blood Glucose Monitor adds a software package, more memory and a larger screen to its Prestige model, said Lynne Brown, director of sales and marketing for the Ft. Lauderdale, Fla.-based company. The memory and software package allows readings to be stored and physicians to download readings into a computer. Most manufacturers have and are perfecting modem-based communication whereby the home diagnostic product transmits data to a computer at the physician's office. Physicians can view their patients' latest readings or examine reading patterns over time. If the physician sees a problem, he or she can call the patient and schedule an appointment.
Stark said the Cardiocheck will allow patients to print out their own EKGs at home and take them to their doctors. Omron's IC unit lets patients download their readings onto a computer disk, which can be taken to their physicians' offices and kept in their medical records.
How to Market
The key to successful marketing of home diagnostic products is customer education. The money and desire to purchase products often exist, but most consumers are unaware products exist. Sheehan said less than 20 percent of hypertension patients monitor their blood pressure from home. HME providers should use advertising,
direct mail, store displays and other promotional material to market directly to
consumers and to referral sources.
The challenge for HME providers is not only to educate consumers that products exist but to make their stores the destination for those products. HME providers face direct competition in the home diagnostic market from both discount and specialty retailers.
"Right now the destination for blood pressure (monitors) in the U.S. seems to be with the consumer chain drug store and mass merchants," said Bill Brantman, regional sales manager, home health care division, Omron Healthcare. "But we are spending quite a bit of time developing the HME channel, and it is quickly becoming a improved destination as well."
Howe said Chronimed is marketing Medicare-reimbursable blood glucose monitors to HME providers because they are the most effective for the company. And Home Diagnostics targets HME providers, said Brown because providers must understand both diabetes and glucose monitors. Providers need to give often-anxious patients some comfort with the products because comfortable patients are compliant.
However, sources said Medisana and Omron are targeting mass retail channels in addition to HME providers for their non-reimbursable products.
"Our goal is to offer HMEs higher margin products," Howe said. "HME providers can successfully market and sell home diagnostic products by placing products with Medicare/Medicaid patients and within managed care formularies."
Stark said HME providers are facing increasing competition from upscale department stores. He said affluent baby boomers are getting some diagnostic products from "health care corners" in department stores such as Macy's. Many European specialty stores are stocking more diagnostic products, and Stark predicted that trend will move to the United States.
Although there is more mass-retail competition in the home diagnostic market than with wheelchairs or oxygen systems, HME providers should still seek out cash sales in diagnostics. Middle-aged affluent consumers who come into HME stores for a product for themselves or a parent or relative are potential home diagnostic customers, and providers should attempt to cross sell diagnostic products with other items. For example, when a person with diabetes comes into the store shopping for socks, he or she should be educated about and sold a glucose monitor and vice versa.
"In DME and some home health care arenas, the cutbacks in reimbursement have really played havoc on your local home health care store, so we are trying to get them to think like a retailer and go after cash sale business. If they want to survive in this arena they have to start developing cash sales," Sheehan said.
The home diagnostic market offers possibilities for the HME provider. The market exists and consumers are willing to spend money. In addition, the money-saving products are attractive to payers, which means more payers and clinicians will be encouraging patients and physicians to utilize home diagnostics. To take advantage of this growing opportunity, HME providers must educate a largely ignorant public that products exist and the HME provider is the best place to purchase home diagnostic equipment.
This article originally appeared in the May 1999 issue of HME Business.