When hospice leaders ask others in the industry, “How can we best save money on DME?”, they often receive the usual answer:

 “Renegotiate with your DME vendor.”

A responsibility that often rests on the shoulders of the financial team, renegotiation can be incredibly effective when the hospice is not already receiving the best prices from their trusted vendors. But what happens when your hospice is in fact receiving fair and competitive pricing from your DME vendor and you remain hungry for more savings?

There is a second way to find savings in DME - Utilization Management.

  • What piece of equipment was ordered?
  • When was this piece of equipment ordered?
  • Why was this equipment ordered? 
  • Is this best for the patient?
  • Is this the best for the hospice? 

These are just a few of the many questions that comprise an effective utilization management analysis.

Such analysis is usually dependent on those responsible for clinical decisions at hospices, which is why this approach is rarely employed.  However, done properly, this approach can result in substantial improvements in patient care while simultaneously decreasing DME costs – a result we can all get excited about.

What will come as a surprise to many, the DME company is not the best source for this intelligence. They are often willing to assist their hospice clients as a trusted partner of the hospice, but are simply not equipped to provide such a consultative approach as it relates to the unique needs of hospice patients.  Likewise, nurses are often trained by other nurses (and the DME providers), and not able to provide such insights either.  The answer for obtaining specific utilization management tools such as clinical decision trees, industry best practices, and physician advisory services is to engage with those who can provide such industry intel. 

Armed with the knowledge of what is being done by other leading hospices that are backed by sound clinical outcomes, hospices can then consider what is best for their individual patients.  The resulting DME savings through this approach can be staggering to say the least.  Furthermore, this approach starts with those it should start with: those directly responsible for quality of care in the hospice.  The key to triggering savings once assured of fair value pricing from their DME vendor is utilization management.  The former can assist with achieving short-term savings, while the later ensures short and long-term savings on DME, taking yet another critical step towards truly building a financially sustainable hospice practice.

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Dr. Hall Thorp

Qualis Management

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