From outside and far away the German homecare market seems to be very attractive. Biggest country in EU, strong economic basis and a long time established and accepted social system. As a result of this view nearly all producers of homecare products are trying to in the one way or the other to get a part of the cake.

But the results are quite sobering for the most of the companies including those who are German. So what could be the reasons for this disappointment?

At first, Germany is not one market. It consists in some respect of 16-30 markets. You say that platitude is true for every market? Yes, but here are the facts:

180 public health insurances using 4 different ways of buying and if they use the same way the use different prices, equipment or added services. Where in the world a wheelchair can be bought, leased, or only paid for use by the public health insurance? Where in the world would you find that there are > 25 contractual prices for one incontinence products by public health insurances? And where would you find >15 contractually defined standards for the equipment of one type of wheelchair?
[Read more →]

Experts Spot New Form of Sleep Apnea

(HealthDay News) — Mayo Clinic researchers say they’ve identified a new type of sleep apnea called “complex sleep apnea” that may be resistant to standard treatment such as continuous positive airway pressure (CPAP).

I am confused. Is the fact that 4000 items of homecare products from Invacare, Pride and Sunrise are being auctioned by NJ an indication of an efficient or inefficient DME supply system?

Source: State of New Jersey Holds Mega Durable Medical Equipment Auction on Bid4Assets: Financial News - Yahoo! Finance

Perhaps learning from recent experience in the homecare mobility (and oxygen) business the Sleep Manufacturers Alliance has been formed. More details at RTmagazine

When arch rivals such as Embla, Fisher & Paykel, Invacare, Pro-Tech, Puritan Bennett, ResMed, Respironics, Sunrise Medical, and VIASYS get together you have to believe that there are huge industry challenges on the way.

Perhaps a group like this can help provide the balance in providing great affordable healthcare in an environment where politicians are perhaps more interested in their next election results than in the health of their constituents.

The American Association For Homecare published results of a study demonstrating that about 75% of the cost of treating CMS patients at home is related to services, delivery and operating expenses. The study comes in the wake of the attempted capping of reimbursement for oxygen equipment delivered to the home. See recent related market commentary.

This post a few days ago refers to the impact of Asian sourcing on both large traditional homecare manufacturers and the smaller “importer” - fast brand developing companies in Europe and in Germany in particular.

The announcement (see Reuters article) today of the Yuan revaluation is probably going to remove a point or two of margin from both company types as the customer downstream is still not willing to accept a price increase.

Few, if any homecare companies are making a lot of money in Germany. This does not help.

The writer is going to be in Shanghai next week. It will be interesting to hear the Chinese perspective. More to come…

This article from HME News may be of particular interest to the homecare industry in Europe and especially Germany where there are distinct similarities with the US concerning issues of pricing pressure, reimbursement and costs which have become increasingly important.

Adding fuel to the fire the classical �importers� into Germany (3rd biggest world homecare market) have been gaining share in certain categories as a result of low prices coming out of Asia � helped in addition by a strong Euro versus the US Dollar. Due to fierce competition in a reimbursement declining environment much of the lower cost benefits have had to be passed on to their customers. This has allowed some of these �lower profile� importers to assume a much bigger role and attract the attention of the bigger buying groups. At the same time they are improving quality, getting their product specifications right � and yes � building their company image and brand � and doing it well.

[Read more →]