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They’ve Got QuestionsYour customers need answers to health reform issues, and they’re looking to their sales reps for help.

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contents

repertoire magazine (ISSN 1520-7587) is published monthly by Medical Distribution Solutions Inc., 1735 N. Brown Rd. Ste. 140, Lawrenceville, GA 30043-8153. Copyright 2014 by Medical Distribution Solutions Inc. All rights reserved. Subscriptions: $49.00 per year for individuals; issues are sent free of charge to dealer representatives. If you would like to subscribe or notify us of address changes, please contact us at the above numbers or address. POST-MASTER: Send address changes to Repertoire, 1735 N. Brown Rd. Ste. 140, Lawrenceville, GA 30043-8153. Please note: The acceptance of advertising or products mentioned by contributing authors does not constitute endorsement by the publisher. Publisher cannot accept responsibility for the correctness of an opinion expressed by contributing authors. Periodicals Postage Paid at Lawrenceville, GA and at additional mailing offices.

in every issuePublisher’s Letter ................................................................................................................6Practice Points .....................................................................................................................8Tech Talk ...........................................................................................................................47QuickBytes ........................................................................................................................54

Windshield Time .............................................................................................................56News ..................................................................................................................................64New Products ...................................................................................................................64$128 Question ..................................................................................................................66

Contracting Executive ProfileSupply chain expert David Hargraves has paved the way for future expansion and new direction at UPMC.... ..........................................................14

idn opportunities

HIDAHIDA’s Health Reform Update................................................................................................12

Colorectal CancerEarly detection and diagnosis can often lead to a cure.. ... 42

disease states

Less Talk, More Sales

Al Frere – pg 60

Colorectal Cancer Awareness MonthMarch is the month to remind your customers of the importance of testing patients for early signs of disease. It’s also a good time to consider your own health. ............ 50

healthy reps

18pg

trendsAntibacterial Soaps and Washes Under the Microscope

But the FDA’s proposed rule is an opportunity for reps to emphasize to customers the importance of buying healthcare-grade products .........................................36

40pg

Building BlocksThe economy and healthcare reform are shaping the future of hospital and outpatient facility construction

The Affordable Care Act: A primer.. ...................................................................................10

health reform navigation

Liability Costs IncreasingRising liability costs threaten long-term-care providers in 2014. For sales reps, this is an opportunity to help customers focus on cost savings solutions. ........................ 52

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publisher’s letter

6 March 2014 • www.repertoiremag.com

The ACA Madness

Brian Taylor

editorial staffeditor

Mark [email protected]

managing editorGraham [email protected]

senior editorLaura Thill

[email protected]

art directorBrent Cashman

[email protected]

corporate vice presidentScott Adams [email protected]

(800) 536.5312 x5256

director of business development

Micah McGlinchey [email protected](800) 536.5312 x5268

Product and

Marketing Manager

Alicia O’[email protected]

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Brian Taylor [email protected]

circulation

Laura [email protected]

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Subscriptionswww.repertoiremag.com/

subscribe.aspor (800) 536-5312 x5259

2014 editorial boardTracy Howard : Cardinal Health

Bill McLaughlin Jr. : IMCO

Bob Miller : Gericare Medical Supply

Linda Rouse O’Neill : HIDA

Jim Poggi : McKesson Medical Surgical

Brad Thompson : NDC

Chris Verhulst : Henry Schein

repertoire is published monthly by mdsi 1735 N. Brown Rd., Suite 140, Lawrenceville, GA 30043, Phone: (800) 536-5312, FAX: (770) 709-5432; e-mail: [email protected]; www.medicaldistribution.com

March Madness is upon us, and this time I am not referring to my hope that the Orangemen of Syracuse will be cutting down the nets at the end of the NCAA Basketball Tourney. No, this year we are focusing on the madness that has surrounded the ACA and anxiously await the score of the numbers of “newly

insured” that will have signed up by the March 31 deadline. That is, if the deadline is not delayed or moved like the other 20+ times the “law” has been arbitrarily altered since it passed. If I sound skeptical, it’s because I am.

My doubts are grounded in my belief that the ACA is nothing more than an attempt to move the nation toward a single payer system. Though thinly disguised as a way to increase the access to insurance for those without it, curb costs and improve the quality of care, this law fails to find the mark on all accounts. First, the number of uninsured is greater today than before the law was passed. The purported cost savings are limited to a small sliver of the population, while many more face increased costs due to rising premiums and higher deductibles. The claim that healthcare costs have gone down (actually that the rate of growth in rising costs has slowed) may be true, but has done so with no help from the ACA, despite claims to the contrary. I suggest we see what the premiums are for 2015 and 2016 before anyone starts congratulating themselves on bending the healthcare cost curve.

The proof, as they say, is in the pudding. We will have to see how a number of issues play out, among them:1. Will enough people have signed up for the exchanges to be financially sustainable?2. More importantly, will the mix of insured provide financial stability to the exchanges?3. Will the networks that accept Exchange enrollees be sufficient or acceptable to the patients they will serve?4. Will the formerly uninsured population that heretofore received care free of charge (for the most part)

via the ER, be sticker-shocked when they now are asked to pay out of pocket to cover their deductible when they see a physician?

Only time will tell, but I’m not optimistic. On the positive front, our industry is preparing to deal with any and all eventualities. Check out our cover

story on selling in the era of reform. We asked a cross section of distributor veterans what they expect and how they are dealing with the changes in customer behavior resulting from reform. It is comforting to know that there are plenty of smart people on that side of the ball. I found it to be one of the most interesting and informative interviews we have done. Thanks to all of those who were good enough to participate. Look for a follow-up piece in the April issue!

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Editor’s note: Welcome to Practice Points, by physician practice management experts Capko & Morgan. It is their belief – and ours too – that the more education sales reps receive on the issues facing their customers, the better prepared they are to provide solutions. Their emphasis is on helping physicians build patient-centered strategies and valuing staff ’s contributions.

But what if your products don’t open the door on their own? There are still ways you can be indispensable to your clients, because you have access to business information and knowledge they don’t.

For example, large company sales teams are often briefed on state of the market information that includes knowledge about trends in federal, state and local regulation. Physicians are often hungry for this type of information – and find that messages from medical organizations (who are tasked with lobbying one side or the other) can be mixed. If someone in your organiza-tion is working on the business impact of regulatory change, that kind of bottom-line view can be very useful (and refreshing) for physicians trying to sustain practice profitability.

Similarly, in today’s healthcare en-vironment, payment model change is underway – and doctors are nervous. Do your internal strategists have in-sight about how health plan strate-gies are evolving? Many physicians are mulling the possibility of a switch to direct pay or concierge model. Do you know others who’ve successfully made the shift? Reps are uniquely positioned to know what works and what doesn’t. War stories are almost always welcome if they can help a physician avoid costly mistakes.

Local insightsDoctors are also often too busy to even understand their own local market posi-tion – and they may not even know why

What Do You Know That Your Clients Don’t?

It’s not hard to find doctors who value the reps who bring them the products they love – those reps have it easy. Doctors will always welcome samples of the

diabetes drug their lower-income patients need but can’t afford, or the chance to roll out a highly successful device with co-op marketing support, or even just the assurance you’ll keep them stocked with supply-room essentials they can’t do without.

By Laurie Morgan, Capko & Morgan

All of the business intelligence that

corporations take for granted – strategic planning, market

analysis, regulatory research – is either

too time-consuming for most physicians to undertake while

also practicing every day, or possibly not on their radar at all.

they should care. Many of the doctors we meet have no real idea how saturated the market is for their services – and so may go entirely ‘by the seat of the pants’ when making important decisions like adding a new provider or dropping a health plan. If you’re examining demo-graphic trends in your area to support your sales efforts, that same data could be helpful to your clients – especially if you shared not just the data, but the context and why it matters. For ex-ample, have employment shifts in your area caused a shift in local demograph-ics? Here in the San Francisco area, the last few years have brought a dramatic change in many of our neighborhoods – and that has changed the need for healthcare services. Gentrification of older neighborhoods has brought an influx of well-insured, wealthy young adults. That evolution is in the rear-view mirror now, but imagine how helpful it would have been for a geriat-ric or pediatric practice to understand the trends underway five or ten years ago. A well-staffed, well-positioned practice that made room for growth in the early 2000s would be thriving in an enviable way by now.

All of the business intelligence that corporations take for granted – strate-gic planning, market analysis, regulatory research – is either too time-consuming for most physicians to undertake while also practicing every day, or possibly not on their radar at all. And that spells op-portunity for reps – even ones whose products aren’t yet on the must-have list – to make themselves indispensable to their clients.

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health reform navigation

Enter the Patient Protection and Affordable Care Act, or ACA. The ACA was signed into law on March 23, 2010. After much debate regarding its consti-tutionality, it was upheld by the United

The Affordable Care Act: A primerSupplier success in a post-reform healthcare market depends on a lot of factors, including a fundamental and thorough understanding of the foundation of healthcare reform. This is part of an ongoing series designed to help Repertoire readers understand the implications of reform.

The current rate of healthcare spending in the United States is unsustainable. Healthcare is currently growing at a rate faster than our economy. In 2011, it account-

ed for 17.9 percent of our country’s Gross Domestic Product, equaling an annual spend of $2.7 trillion. If we stay on this cur-rent path, healthcare spending is projected to grow to over $4 trillion and will be 20 percent of the United States economy by the year 2021.

States Supreme Court on June 28, 2012. Many of the provisions for the new law began when it was passed in 2010, with more changes forthcoming.

Many viewed last year’s poorly executed rollout of the online in-surance exchanges as a failed ACA. In fact, that only affected one com-ponent of the law – the individual mandate for people to have coverage – and that was extended to the end of

March 2014. In short, the overall goals of the Affordable Care Act remain the same: To improve the quality of care in our country while reducing the waste and costs associated with that care.

Changes to health insuranceWith 50 million – or 16.3 percent – of our population uninsured or underinsured, lawmakers determined there must be significant changes to the coverage available and how we acquire health insurance as a nation.

In 2010, immediately following the ACA being signed into law, insurance providers had to begin limiting the use of annual caps for coverage, meaning they could no longer cap how much a patient can use in a given year. For patients with preexisting conditions, compa-nies could no longer turn down children, and they were required to create high-risk pools for adults, providing coverage for those who did not have access in the past.

Compensation for all caregivers is likely to change. Until now, physician compensation has been based on a fee-for-service model.

www.repertoiremag.com • January 2014 11

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The law calls for all Americans to have insur-ance or pay a fee. Small businesses were scheduled to be given tax credits to cover costs for their em-ployees, beginning in tax year 2010. Uninsured or underinsured patients were given the opportunity to purchase guaranteed coverage through exchanges, or online marketplaces. For those patients who cannot afford care, state and federal governments are work-ing together to expand Medicaid programs.

The result could be as many as 32 million newly insured patients in the healthcare system.

The physician’s roleBecause of the ACA, primary care physicians are ex-pected to become the center of care for a large num-ber of patients, helping them understand treatments, coordinate care with specialists, and ultimately man-age their local population of patients.

Compensation for all caregivers is likely to change. Until now, physician compensation has been based on a fee-for-service model. This was very test- and procedure-focused, and didn’t fo-cus on the patient getting better. Moving forward, care will be outcomes-based, meaning physicians will be reimbursed higher amounts for keeping patients healthy and out of the hospital or acute-care setting. Caregivers will receive “bundled pay-ments” for a diagnosis and treatment. And there will be a new emphasis on patient education around prevention and wellness.

Steps are being made to reduce medical mal-practice and errors, and to implement “comparative effectiveness,” a way to find the most cost-effective way to treat a patient by looking at a direct compari-son of existing treatments to determine which works best and which poses the greatest harm.

MDSI – the parent company of Repertoire – has devel-oped the Healthcare Reform Navigation Series, an online program designed to make the task of preparing your orga-nization for 2014 and beyond easier. This series will help you and your team with online courses that explain many of the key elements integral to understanding reform and the transformation from fee-for-service to fee-for-value. The program includes a 12-month schedule of topics and live sessions with industry experts.

To learn more about the Healthcare Reform Navigation Se-ries, contact Tim Brack, director of training, education and meetings, at 770.263.5270 or [email protected].

12

hida

March 2014 • www.repertoiremag.com

HIDA’s Health Reform UpdateBy Linda Rouse O’Neill, Vice President, Government Affairs, HIDA

The following update by the Health Industry Distributors Association (HIDA) is designed to keep healthcare distributors and other key stakeholders current on the latest government-affairs related topics.

SGR repeal within Congressional sightsFor more than a decade, Congress has made a habit of delaying a statutorily required reduction to the physician sustainable growth rate (SGR) payment formula that af-fects overall physician Medicare reimbursement payments. It came as little surprise that 2013 was no different when, as part of a bipartisan, bicameral budget agreement, Con-gress passed a 90-day “patch” bill in December to delay a 16.7 percent SGR reduction and a 20.1 percent reduction in total Medicare reimbursements.

While the “patch” bill temporarily extends the current formula until the spring of 2014, there is hope that a more permanent SGR alternative could be enacted before the end of the year. Lawmakers in both chambers of Con-gress are currently negotiating language for a final replace-ment compromise policy.

Agreeing on a policy is the easy part as the three committees with jurisdiction on this issue – the Senate Finance Committee, the House Energy and Commerce

Committee, and the House Ways and Means Committee – all passed similar bills in December 2013. The hard part is agreeing on the offset, which the Congressional Bud-get Office estimates will cost between $121.1 billion and $150.4 billion from 2014 to 2023.

Early indications show that Congress has its sights focused on post-acute providers for a large part of the offsets. The final policy agreement will likely include some type of increase for physicians while a value-based perfor-mance incentive and alternative payment model is imple-mented. Expect more news to develop regarding perma-nent SGR repeal in the coming months.

MedPAC issues 2015 payment recommendationsIn late 2013, the Medicare Payment Advisory Commis-sion (MedPAC) met to discuss draft recommendations regarding 2015 payment updates for Medicare providers. MedPAC recently voted in favor of approving draft rec-ommendations focused on site neutral payments. These recommendations can be found in MedPAC’s March re-port to Congress, which include:

• Aligning payment for 66 types of services, regardless of whether they’re provided in hospital outpatient departments or physician offices. This could save Medicare $1.1 billion.

• Lowering long-term care hospital payment rates for non-chronically ill patients (i.e., patients who have spent fewer than eight days in intensive care units) to the rates paid to acute care hospitals.

• Eliminating payment updates for skilled nursing facilities, inpatient rehabilitation facilities, long-term care hospitals, and hospice agencies, which are all projected to have positive margins in fiscal year 2015.

HIDA’s Government Affairs team recently consolidated MedPAC’s recommendations into a Policy Outlook brief. To access this document or for information on other GA top-ics – including SGR repeal – visit us at www.HIDA.org or contact us at [email protected].

Agreeing on a policy is the easy part as the three committees with jurisdiction on this issue – the Senate Finance Committee, the House Energy and Commerce Committee, and the House Ways and Means Committee – all passed similar bills in December 2013

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“Supply chain management rec-ognized the need to relocate and ex-pand the distribution services offered to UPMC facilities,” says Hargraves. “Despite significant gains in operating efficiency in our [old] facility, which was 51,000 square feet, hospital acquisitions as well as organic growth had stretched our internal capacity and forced us to further leverage our external distribu-tion relationships. [Relocating to the newly constructed facility] has perma-nently reduced supply costs by millions of dollars through the elimination of the external distribution markups and provided us the opportunity to opti-mize order volumes and deliveries to reduce freight and labor cost.”

Opening a larger service center cre-ated other benefits as well, including:

• Improved efficiency through reduced amount of orders and reduced cross docking.

• Reduced waste through eliminating double handling of products.

• Increased compliance with UPMC’s preferred suppliers and products, and fewer special-request orders.

Contracting Executive ProfileSupply chain expert David Hargraves has paved the way for future expansion and new direction at UPMC. By Laura Thill

David Hargraves may not have moved mountains, but he’s come close. In the last couple of years, the vice president of clinical supply chain, University of Pittsburgh Medical Center

(UPMC), Pittsburgh, Pa., and vice president operations, BioTronics, Inc., has led the design, construction and opening of a 148,000 square foot consolidated service center. And, that’s just for starters. Relocat-ing to the new facility has enabled UPMC to support internal growth and future hospital acquisitions, as well as move to a manufacturer-direct supply chain model.

A $10 billion integrated global health enterprise, University of Pittsburgh Medical Center (UPMC), Pitts-burgh, Pa., comprises more than 20 academic, community and regional hospitals. In addition, the IDN has:

• Over 4,500 licensed beds.• 400 outpatient sites, plus various rehabilitation, retirement and long-term care facilities.• Approximately $1 billion in annual spend.

UPMC: facts and figures

David Hargraves

idn opportunities

• Reduced risk exposure and complexity though a shortened supply chain.

• Improved customer satisfaction through higher fill rates and fewer stock outs.

• Increased capacity to service additional demand, and the ability to service 100 percent of UPMC acute care facilities.

Throughout the process, notes Hargraves, costs were systemically reduced or eliminated, rather than simply shifted.

BioTronicsHargraves credits UPMC chief supply chain officer, Jim Szilagy, with expanding the role of supply chain at the IDN by drawing from best practices from vari-ous industries outside of healthcare. Today, UPMC’s

supply chain provides the IDN with a variety of ser-vices, including pharmacy packaging services, spe-cialty bed and equipment distribution, and employee transportation services. In addition, the UPMC sup-ply chain has several for-profit organizations, includ-ing Prodigo Solutions, LLC (a procurement and sup-ply chain software and services company) and HC Pharmacy Central, Inc. (a group purchasing organi-zation and pharmacy distribution center).

Hargraves is focused on integrating UPMC’s wholly owned subsidiary, BioTronics Inc., into the IDN’s sup-ply chain and expanding its services. The goal is to de-liver additional value for UPMC, he points out.

BioTronics was started in 1980s in what was then Shadyside Hospital (prior to UPMC’s existence), he ex-plains. “[Today it is] a fully centralized clinical engineering department with 145 engineers servicing 140,000 pieces of medical equipment. It offers a medical equipment re-pair service, preventive maintenance and quality assurance programs to UPMC, as well as to external for-profit clients under a variety of engagement options. Engineers and technicians have specialized OEM training and hands-on experience with state-of-the-art medical equipment.”

Hargraves is focused on integrating UPMC’s wholly owned subsidiary,

BioTronics Inc., into the IDN’s supply chain and expanding its services. The goal is to deliver additional value for UPMC, he points out.

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idn opportunitiesIndeed, with the addition of Bio-Tronics, UPMC now has access to such services as:

• Medical equipment maintenance.• Imaging equipment

maintenance.• Surgical instrument repair

and refurbishment.• Sterilizer and washer

maintenance and repair.• Clinical support.• Laser and image guided

surgery support.

Additionally, BioTronics provides an equipment management system, Integrated Technology Solutions.

Hargraves says that from a supply chain perspective, develop-ing BioTronics has already led to some positive changes. With regard to UPMC’s fleet equipment initia-tive, where supply chain executives develop a five-year plan for replac-ing classes of equipment across the health system, they now can “lever-age a 30-year history of total cost ownership to predict when devices will reach their economic end of use-ful life,” he explains. As a result, he and his team can initiate bulk purchases, which should help lower their acquisition costs.

Hargraves anticipates that bring-ing BioTronics under the same roof as UPMC’s supply chain will help im-prove management and oversight of external equipment service contracts, as well as lead to additional career paths and advancement opportuni-ties for supply chain professionals and clinical engineers across the IDN.

Just as UPMC has taken steps to prepare for its future, so too must the industry at large, notes Hargraves. In the next several years, one of the greatest changes he foresees in healthcare contracting is “the adop-tion of contractual commitments by more medical device manufacturers to go at risk for patient outcomes.

“Increased consolidation among providers, coupled with a nationwide increase in sophistication in hospital supply chain managers and the imple-mentation of the Affordable Care Act, will help end the era of suppliers being able to push price increases on provid-ers with no corresponding increase in clinical efficacy,” he says. “Suppliers who truly believe their products de-liver increased performance and effec-tiveness will be required to contractu-

ally guarantee this performance in order to receive any form of price premium.”

When he joined University of Pittsburgh Medical Center (UPMC), David Hargraves, C.P.M., M.B.A., brought a repertoire of experiences. He had worked in supply chain leadership positions with Alcoa and Ariba, and was a biomedical equipment technician with the U.S. Navy. A certified purchasing manager, he received his MBA from Waynesburg University, a B.S. in organizational leadership from Duquesne Univer-sity, and an A.S. degree in biomedical engineering technology from Penn State University.

More recently, Hargraves served as president of the Large Hospital Consortium, an organization of healthcare teaching institutions. Today, he is an adjunct lecturer with Chatham University, where he teaches a graduate course in sustainable supply chain management. Hargraves is also an active mem-ber of AHRMM and the Institute of Supply Management, and recently presented “Pursuit of Total Care Cost: Elusive or Obtainable,” at the AHRMM 2013 Conference & Exhibition in San Diego, Calif.

As vice president of clinical supply chain at UPMC, Hargraves is responsible for the following:• Clinical engineering (BioTronics, Inc.) • Strategic sourcing• Procurement operations • Value analysis

When teaming up with his supplier partners, David Hargraves, C.P.M., M.B.A., vice president of clinical supply chain, University of Pittsburgh Medical Center (UPMC), Pitts-burgh, Pa. and vice president operations BioTronics, expects them to demonstrate integrity. “Integrity describes a supplier that does business honestly and morally,” he says. “By ap-plication, this means a supplier that does not hide quality issues when they arise, and does not try to push through price increases when they are not warranted or justified.” Nor does an honest and ethical supplier try to backdoor sell to clinicians around a provider’s value analysis process, he con-tinues. “Integrity breeds trust, and trust is an enabler to future business and collaboration in my organization.”

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www.repertoiremag.com • March 2014 19

After a rocky rollout, the Affordable Care Act – healthcare reform – has put the wheels of change

in motion. Just as reform is affecting healthcare providers, so too is it affecting the sales reps who call on them.

Repertoire asked a number of sales professionals to talk about how reform is affecting their customers and how they are responding. We collected their responses and present them here as a virtual roundtable. Our participants in this month’s roundtable are:

• Alan Grogan, president, Grogan’s Healthcare Supply.• Gina Marchese, senior vice president, sales and

marketing, MMS – A Medical Supply Company.• Patrick Balistreri, field sales consultant; and

Ty Ford, general manager, Healthcare Services, Henry Schein Medical.

• Bob Ortiz, vice president, sales, physician office division, Medline Industries.

Look to our April issue for Part 2.

Your customers need answers to health reform issues, and they’re looking to their sales reps for help.

They’ve Got Questions


selling amidst healthcare reform

Grogan: Yes. [This] would be a continuation of the trend over the last several years, along with other forms of con-solidation, such as combinations and mergers between large practices, and perhaps even franchising activity.

Marchese: Absolutely. From MMS’ perspective, this means opportunity either way. For over 40 years we have serviced both classes of trade. Because of our strong relationship with

acute care facilities, we expect to pick up business. We have a track record of delivering more than just products; we proac-tively work with our customers in supply chain logistics, de-tailed reporting by location, and contract management. A lot of the metrics previously used only in hospitals are now being required by all provider sites, so for those practices remaining independent, MMS offers a unique value.

Balistreri: As healthcare reform takes hold, I continue to see that happening, particularly among primary care, OB/GYN, and internal medicine practices. Among the spe-cialty areas, such as plastic surgery or orthopedics, I see more of a hybrid model emerging rather than the hospital or IDN outright buying the group. In that model, the IDN and orthopedic group, for example, might jointly own a surgery center. These are very specialized, talented doctors

to whom the hospital wants their patients to have access. So they’re working together.

Ford: I think it will continue to increase. Some IDNs have a far more aggressive ambulatory strat-egy than others. It depends on the part of the country they’re in, and their ambulatory strategy. I see

more strategic partnerships taking place today than in the ’90s. A lot of lessons were learned then. Today, hospitals and IDNs have a clearer understanding of their expectations.

Ortiz: We believe this trend will continue for at least the near future.

“ Today, hospitals and IDNs have a clearer understanding of their expectations.”

–Ty Ford

Repertoire: As you look to the year ahead, do you foresee some of your physician practice customers getting acquired by hospital systems?

Repertoire: Judging from your conversations with customers, what are the 1-2 most important factors driving physician customers to sell their practice to a hospital or IDN?

Grogan: Being overwhelmed by the emerging complexi-ties and fearful of the ACA and the many other unknowns, and wanting to get back to the reasons they went into med-icine in the first place – to focus on their patients and leave the business side and increasing reimbursement hassles to someone else. It will not likely be a formula for prosperity when what you do for a living is being considered by many as a human right whose costs must fit somehow within a woefully unbalanced budget.

Marchese: Almost universally, what’s driving the move to corporate ownership is frustration. More and more of what physicians went into medicine for (healing patients) is being subjugated to paperwork, bureaucracy and defen-

sive medicine. If they are going to have their patient care monitored and second-guessed, they’d rather be on a pay-roll, get benefits and regular hours than do the same thing for themselves with the responsibility, time and costs of being both business owners and providers.

Balistreri: Some doctors who have had their own practices for a long time may find it difficult to master EMRs or the new coding that’s coming up. To understand everything that’s going on, they may need a larger staff. IDNs are set up for that, but smaller practices often aren’t. In those cases where physicians aren’t embracing these changes, they may want to retire and work out a deal with the IDN. But many physicians are independent and doing quite well; they understand EMRs,

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selling amidst healthcare reformcoding and reimbursement changes. They have good staffs, and they will remain independent.

Ford: I think it’s being driven by three trends. The first is economic pressure. All of us are having to do more with less; the healthcare world is no exception. Economic pressures are causing physicians to transform the way they have historically prac-ticed medicine, and they are chang-ing their focus to outcomes. The second trend is the political land-scape. As healthcare reform unfolds, we see that the entire reimbursement

structure for physicians is changing. The third trend is demographics. Down the road, we’ll reach a point where the shortage of primary care physicians will catch up to us.

Ortiz: First, the feedback we are getting [indicates] there seems to be some confusion about the new healthcare reimbursement model driving fiscal challenges to the prac-tice. Also, the physician’s ability to align with a larger group and focus on the practice of medicine vs. the business side of medicine is appeal-ing to many.

“Almost universally,

what’s driving the move to

corporate ownership is frustration.”

– Gina Marchese

Repertoire: In your experience, after a physician practice is acquired by a hospital or hospital system, does its influence over purchasing decisions increase, decrease, stay the same? How does it change your selling approach to these customers?

Grogan: In most acquisitions things are not supposed to change, but inevitably they do in significant ways once the honeymoon ends. Influence over the product selection decisions stays about the same for a while but then gener-ally declines, though influence about where to purchase is lost very quickly. Health systems do seem to realize they have many unanswered issues related to serving their staff physicians, but those issues are further down the list of priorities, so the path of least resistance tends to win out temporarily. We have a message for them with some sup-ply chain solutions, but grabbing their attention is diffi-cult when they perceive their survival is at stake related to reimbursement and outcomes measures and the rest that must come first.

Marchese: It usually decreases. In most cases, once the practice’s transition to the new corporate structure is com-pleted, we are NOT selling to the practice. Purchasing is going through a central point, which often specifically precludes contact with the physician’s office. If allowed, the distributor can facilitate brand selection through a clinical advisory committee or by helping manufacturers access physicians. The role of a distributor rep in sup-plying physician groups or networks is to create value at the corporate level by assisting materials management in defining and driving the efficiencies and standardization that the organization bought the practices to acquire. A distributor rep needs to be able to generate and interpret

timely usage data and translate it into actionable strate-gies. The rep needs to be proactive in suggesting product savings, operational efficiencies (delivery/storage/inven-tory), and contract management. A distributor’s unique value in a corporate healthcare purchasing structure is to bring logistics expertise to the supply chain. This is a far more sophisticated and focused service value than the distributor rep has traditionally needed to support individual practices.

Balistreri: Every situation is different. In a straight IDN buyout, purchasing responsibilities often move away from the office manager or nurse practitioner, to a purchasing group. Usually, many committees are involved. If it’s not a straight buyout, but rather, some kind of alliance or hybrid structure, this may not be the case.

Ford: It depends on whether the IDN is fully integrated, or more loosely integrated. If the IDN has a “cradle-to-grave” focus, initiatives will be pushed from the top down. [Administration] will provide direction, but in either case, the landscape changes. We always ask our-selves, “How does this change our approach?” We have to align ourselves with the strategy that’s in place, or what will be in place.

Ortiz: While not immediately, but over time, the acquisition causes a major change in the behavior. We believe that for



Repertoire: After a physician practice is acquired by a hospital or hospital system, does the practice become more price-sensitive, less price-sensitive, or neither?

Medline, this is one of our areas of strength, where we can help the acquired physician practice. Because of our pres-ence and visibility in the acute space, we are able to offer a one-stop solution to the customer. Our approach is simple: Our call point is focused on the mix of the acute care side and the non-acute side combined. We are able to offer the

solution of one manufacturer, distributor and prime vendor for all of the classes of trade the system manages. We call this ONE Medline. This strategy helps to ensure the same contract pricing is provided to all facilities across the con-tinuum of care, as well as help drive standardization and formulary compliance among all facilities in a health system.

“Grabbing [providers’] attention is difficult when they perceive their survival is at stake.”

– Alan Grogan

Grogan: Whether acquired or not, everyone gets more price-sensitive anytime they see their own survival as threatened. Driving revenue while also reducing expenses is what fuels the acquisitions in the first place.

Marchese: Mostly, once a practice is acquired, purchasing usually de-faults to the acquirer. So the prac-tice doesn’t have to be as concerned about price as much as they did pre-viously. [But] if they feel that they

are being forced into using an infe-rior product because of a perceived savings by a non-clinical decision-maker, they will fight for a product that they prefer.

Ortiz: The practices become more aligned with their acute care partner and are able to access the hospital contracts. In most cases, that means a significant reduction in cost and the ability to achieve the lowest possible acquisition costs.

Repertoire: In light of healthcare reform, do the majority of your physician practice customers anticipate an influx of patients in the year(s) ahead? Decrease? No big change? What can you as a sales rep do to help them respond?

“If [physician practices] feel that they are being

forced into using an inferior product because of a perceived savings by a non-clinical decision-

maker, they will fight for a product that they prefer.”

– Gina Marchese

Grogan: I think physicians still don’t quite know what to expect at this point. They hear both sides of the cur-rent debate, neither of which can be fully trusted. Com-mon sense says they should expect they will be asked to do more – see more patients – with less – lower re-imbursement – along with everyone else in the system. Medicaid is already the predominant payer in parts of our market, and nearly 80 percent of the early ACA enrollees in Kentucky went on Medicaid, so that system will be under greater pressure. As suppliers, we have

to figure out ways to help them do more for less, with greater efficiency internally, and with products focused on outcomes but not with premium price tags, none of which are that easy.

Balistreri: One community health center in my territory is expecting an influx of patients, and they are respond-ing by building a new, larger facility and adding staff. My primary care and internal medicine customers are also looking at an influx of patients, though it depends on

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selling amidst healthcare reformlocation. Some practices in the city are expecting more newly insured patients because of the Affordable Care Act, but others, such as those in the suburbs, are not so sure, because many of their patients al-ready have insurance. Those health centers and practices that are an-ticipating more patients are either adding physician partners, or they are bringing on more physician as-sistants and nurse practitioners.

Ford: The anticipation of more patients is another factor driving acquisitions, strategic partnerships and strategies at the IDN level.

They’re looking at it from a cost-to-serve perspective, and are ask-ing themselves, “How can we see more patients without increasing our top line?” In the past, they assumed the primary care setting would accommodate growth; to-day, they’re adding new special-ties and getting into markets they weren’t in before, such as free-standing ERs.

Ortiz: Most of our customers are expecting a significant increase in patient traffic. Our sales force must respond to this with technology so-lutions and operational efficiencies.

Repertoire: The Affordable Care Act attempts to reduce healthcare costs by encouraging doctors, hos-pitals and other healthcare providers to form networks – or accountable care organizations (ACOs) – to coordinate care. How would you characterize your customers’ interest and/or participation in ACOs? Has that changed their expectations of sales reps? If so, how? And how have you responded?

“Health centers and practices that are anticipating more patients are either adding physician partners, or they are bringing on more physician assistants and

nurse practitioners.” –Patrick Balistreri

“ Selling solely on reimbursements will be less impactful in an ACO environment that is more focused on patient outcomes and satisfaction.”

– Bob Ortiz

Grogan: It is still pretty early to tell how ACO develop-ment here will progress, particularly in our smaller and more rural markets. Timing is everything, and neither ACO participants nor distributors should be too early or too late in assessing all the moving targets. At this point, we are trying to educate our team on the changes that are coming and not be too quick to assume we have much really figured out. Like many times before, there

will much kicking and screaming, but then things will settle down to the new realities as everyone manages some needed adaptation.

Marchese: Whether it is being acquired by another health-care entity or affiliating with an ACO, the net effect is going to be the centralization of common processes and services to reduce operational costs and therefore, a distancing be-tween our traditional customer and purchasing decisions. As

always, the only way to assure doing business with the new decision-maker is to make sure that the customer under-stands the distributor’s value. Our value proposition needs to shift from product transactions and expertise to what our core charter really is – supply chain management.

At MMS, we are not yet seeing a large share of business coming from ACOs, but we do see customers across ALL of our markets, (acute, physician, long term care, home

care, hospice, etc.) re-evaluating how they approach purchasing. They are worried about where revenue will be allocated as patient care plans cross traditional boundaries. They are look-ing for leadership. They know that the days of negotiating over the price of each product are over.

MMS reps have been trained to be business advisors and partners. However, with our new customer being a purchasing/materials management professional, the selling model for supplying products in the physician market is go-ing to more closely resemble the sales process in the acute care market. MMS recognized this shift some time ago and has been cross-training market-specific reps, into “consul-tants,” who understand and can proactively contribute to a customer’s “business” objectives (vs. just product features


and price). Our goal at MMS is to have our field representa-tives capable of assessing, quantifying and recommending supply chain strategies that reflect the unique requirements of each customer, even it that customer is servicing multiple markets or is part of a larger organization.

In addition, MMS is working with manufacturers to help in the new paradigm. MMS wants to partner with key manu-factures who offer category solutions that are supported by end-user education and the efficiencies of consolidation.

Balistreri: Over the past three to four years, Henry Schein has put together teams, whether it’s the Healthcare Servic-es team or others, to help our customers navigate through things such as ACO setups. When we start seeing ACOs develop [in the field], we can get in touch with people like Ty [Ford] (part of the Healthcare Services team), or our regional or zone managers, set up meetings with these groups, and ultimately answer their questions. We put on our consultative hat, and our customers feel comfortable knowing we’re looking out for their best interests.

Ford: We’ve seen more and more ACOs emerge in the past 12 to 18 months. We believe that this is where the

coordination of care will take place. This is a new cus-tomer for us, and we have to speak a new language to them. At the same time, we have to be able to negotiate at the same level we always have. That is to say, I think the ACOs – if they’re connected with an IDN – will con-tinue to look to the [supply chain] teams that are in place to help drive contract compliance and standardization. At this time, however, we do not see new materials managers in the ACO. We believe they will emerge in the future. To Patrick’s point, we have to rely on team selling, maintain-ing multiple relationships with the customer – especially the customer we’ve never met before.

Ortiz: While some customers remain resistant, most of our customers are facing this industry change head-on and moving in the direction of ACO or ACO-like orga-nizations. This has resulted in changes to selling strat-egies as well. Our sales force must be educated in the ACO marketplace and learn to leverage the ACO model to their value and the customers. Selling solely on re-imbursements, for example, will be less impactful in an ACO environment that is more focused on patient out-comes and satisfaction.

Repertoire: Comparative effectiveness research is designed to provide evidence on the effectiveness, benefits, and harms of treatment options, medical devices, tests, drugs, etc. Have your customers ex-pressed an interest in comparative effectiveness (whether they call it by that name or another, such as “outcomes”)? Have they discussed it with you? If so, how has this changed your approach to sales?

Grogan: Intuitively, everyone has always wanted effective-ness, of course. But it has always been much easier to beat down suppliers that are desperate to hold market share than to objectively validate spending more on a given product. The problems come with the sheer complexity of measur-ing real effectiveness per dollar spent, and the expertise required to do it. Effectiveness presumes a consideration of the underlying economics, but such measures always include trade-offs. As a sales organization, our job has al-ways been to understand and help clarify those trade-offs for our customers. Reimbursement based on “outcomes” will bring new urgency, but our job has always been to simplify the complex rather than complicating the simple, which tends to be more common today.

Marchese: I don’t think most providers are looking to distribution for assistance in outcomes management. However, a distributor rep can assist physicians concerned with outcomes by serving as the source of hard data,

comparative usage, and feedback from other practices. In addition to presenting “the facts,” the distributor rep can advise physicians on reducing cost-in-use by accessing a manufacturer’s support services to assure that the product is used correctly. Probably, the single most valuable thing that a distributor rep can do for an office trying to track comparative effectiveness, is making sure that the cus-tomer understands how much quantitative data is available through the distributor and how they can access, interpret and use it.

Balistreri: Over the past two years, as EHR systems have made their way down to the smaller physician offices, prac-tices are trying to connect multiple offices or entire systems. They are moving toward more outcomes-based medicine in-stead of traditional, basic reimbursement. They are re-tooling some of their offices; they want to be prepared with the right types of diagnostic equipment, so that when the client comes in, he or she has a good experience. By doing this, everyone



Grogan: With the demands on our selling resources in-creasing related to understanding and adapting to reform, we have to be much more selective about where we spend our selling time. Some traditional distribution activities, such as moving market share from one brand to another to gain a bit of margin, will have to be pushed back. Vendors with products that are only marginally less expensive than their competition will need to re-think their approach and cre-ate their own marketing programs to drive demand without direct involvement of our reps. We will have to jump on the “more with less” bandwagon related to our own operations, and help our customers do the same in theirs. We need to understand the reform process to anticipate where new de-mand and customers might be emerging. And work a bit harder but a lot smarter, which is nothing new.

Marchese: Healthcare reform is and will have a dramatic impact on sales. It is totally changing the role definition of distributor rep in the “office-based-practitioner” world. Today’s reps don’t just have to change, they need to be agents and advocates of change, and be open to the fact that change is going to be ongoing for some time. Ev-ery aspect of our physician customer’s business model is changing fast and radically.

Reps who have built careers on product knowledge and relationships have got to step up to also being savvy busi-ness people, conversant and current with healthcare trends and legislation. Critically, they must be technology-friendly;

they need to use and understand the newest communication devices and the data management and access tools that now are at their fingertips.

Balistreri: Our mission at Henry Schein is to speak with our physician customers and find their or their group’s pain points. We are trusted advisors or consultants, and we work to help our customers achieve their goals on a day-to-day basis. Doctors want to provide great patient care. They want a healthy practice and happy staff. We help them navigate through these tough times, so they can go home and get a good night’s sleep, knowing that Henry Schein is helping them be successful.

Ford: Flexibility is important. We can’t approach things as we did five years ago, or even 12 months ago. We have to continue to rely on each other. We employ a team-selling concept that includes multiple levels of expertise, which we feel is the best way to approach our customers.

Ortiz: As a manufacturer and distributor of healthcare products that services all classes of trade, we believe we are well-positioned for the future of healthcare. We have sales teams in all aspects in the continuum of care, includ-ing acute and post-acute, including extended care facilities and home care, ASCs and PO. We believe that the One Medline model is the right choice for our customers in today’s rapidly changing healthcare environment.

Repertoire: How has – or how will – healthcare reform affect your approach to sales?

wins. Larger groups have been on top of this for awhile; now, the smaller ones are seeing the same thing.

Ford: As we continue to see proce-dures pushed into the ambulatory space, we are changing the way we engage our customers. As health-care reform takes shape, their com-petition is being driven by different metrics. We’re seeing our manufac-turer partners tailor their communi-cations toward procedures that drive these quality outcomes. There’s still some catch-up in the industry as to how our customers respond. But the great news is that care is being

driven to the ambulatory care set-ting; that creates opportunities for organizations like Henry Schein to sell deeper and broader into the am-bulatory care setting.

Ortiz: Yes, I think that physicians realize that their roles are chang-ing. Prevention, predictive values and quick results are essential to success in our marketplace. The goal of healthcare today is to keep patients healthy and out of the hospital. Providing diagnostic test-ing that is easy to use and provides both immediate results is more im-portant than ever.

“Effectiveness presumes a consideration of the underlying economics,

but such measures always include trade-offs.

As a sales organization, our job has always been to understand and help

clarify those trade-offs for our customers.”

– Alan Grogan

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4 of 7

7. In light of healthcare reform, do the majority of your physician practice customers:

Anticipate an influx of patients in the year ahead

Anticipate a decrease of patients in the year ahead

Not anticipating any big changes in patient volume in the

year ahead

8. How would you characterize your physician practice customers’ interest in accountable care organizations, or ACOs?

High degree of interest

Low interest

ResponsePercent

39.2%

15.7%

45.1%

ResponsePercent

37.3%

62.7%

4 of 7

7. In light of healthcare reform, do the majority of your physician practice customers:

Anticipate an influx of patients in the year ahead

Anticipate a decrease of patients in the year ahead

Not anticipating any big changes in patient volume in the

year ahead

8. How would you characterize your physician practice customers’ interest in accountable care organizations, or ACOs?

High degree of interest

Low interest

ResponsePercent

39.2%

15.7%

45.1%

ResponsePercent

37.3%

62.7%

What Reps are SeeingEditor’s note: The following responses regarding healthcare reform and its impact on the marketplace are from a Repertoire magazine reader survey.

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Healthcare reform or not, it’s a sure thing that tomorrow’s sales reps will use technology to stay in touch with their customers. Among the start-up firms that are attempting to help them do that are SpotOn Surgical and Nurep.

The mad dashSituations in the OR can get heated pretty quickly. “The minute equipment malfunctions, or a nurse is not well-enough trained to per-form a task or get a setup correct, you have an event on your hands, especially when a patient is on the table under anesthesia,” says Glenn Mills, president, SpotOn Surgical. The doctor screams, “Get the sales rep on the phone,” and the mad dash begins.

Mills is a former Medtronic rep and director of sales and services, who, along with medical services entrepreneur Tom Pfleider and neurosurgeon Dr. Michael Sheinberg, founded SpotOn Surgical in 2011. The company provides perioperative areas with an iPad that acts as a digital reference library for devices and equipment from multiple suppliers, and allows the OR staff to request immediate live assistance from the appropriate sales rep or customer support team.

In May 2013, Veran Medical Technologies – a St. Louis, Mo.-based soft-tissue navigation com-pany – signed on with SpotOn to offer virtual customer support during navigation procedures for the lung, liver and kidneys. SpotOn hopes to be installed in more than 100 hospitals by the end of the first quarter 2014, says Mills.

SpotOn “fulfills a true need in a perioperative environment that has limited in-person support

from representatives while using the most ad-vanced medical technology in the world,” says Mills, citing a study in The British Medical Journal showing that technology mishaps account for one in four operating room errors. “We believe we can improve on this with better organized training materials and immediate remote support when necessary.”

A tactic, not a processIn today’s OR, when circulating nurses have a question for the sales rep, they typically get on the phone. If the rep doesn’t pick up, the nurse might call the rep’s company and hope someone at head-quarters can answer the question. Last resort? The nurse takes a photo with his or her cellphone and sends it to the rep, who picks it up later and gets

back to the nurse. “It’s really not a process,” says Paul Schultz, co-founder, Nurep. “It’s a tactic.” It’s not secure, nor does it help the nurse and surgical team who need an answer on the spot during a procedure.

Palo Alto, Calif.-based Nurep has developed a mo-bile health platform for medi-

cal device companies, which allows on-demand virtual support to the operating room staff. The application, initially developed for iOS devices, is being pilot-tested with several medical device companies and hospitals in the United States, though Schultz did not name them. The ap-plication will initially be sold to manufacturers through software-as-a-service-based contracts.

Nurep is marketing its application for on-demand remote medical device support to healthcare providers, but at some point, manufacturers could use it to remotely detail new technologies, Schultz says.

“We are transforming the medical device support model from a one-to-one to a one-to-many relationship, building a connected network of healthcare providers and medical device representatives,” says Schultz.

Tomorrow’s rep: Staying in touch

Nurep is marketing its application for on-demand remote medical device support to healthcare providers, but at some point, manufacturers could use it to remotely detail new technologies.



Alan Grogan, president, Grogan’s Health-

care Supply, Lexington, Ky.: “Previous policy

and guidelines with respect to entertainment,

dinners, gifts etc. had already reduced if not

yet eliminated the sorts of payments or gifts

that will now need to be reported. So, no, our

interaction hasn’t really changed as a result,

though the burden of reporting will make us

even more cautious about actions that will

require reporting.”

Gina Marchese, senior vice president, sales and

marketing, MMS – A Medical Supply Company:

MMS has really seen minimal impact. The Sun-

shine Act is really more tailored to manufactur-

ers than distributors. Frankly, our margins have

never allowed MMS, or most distributors, to

employ this practice.

Ty Ford, general manager, Healthcare Servic-

es, Henry Schein Medical: From a sales perspec-

tive, we believe it will have an impact on the

market, but to what extent remains to be seen.

Henry Schein has always focused on the custom-

er, and this is just another dynamic to which we

are adjusting. When we engage customers, we

typically find they’re unsure of how it will impact

them. As we get more into it, we will take on the

responsibility of educating our customers, just as

we do with anything else.

Bob Ortiz, vice president, sales, physician

office division, Medline Industries: We at Medline are very serious about adherence to the Sunshine Act and all healthcare regulatory poli-cies. We have a detailed compliance program that we closely follow. We are regularly train-ing via webinars, sales meetings, sales training classes, etc. We also closely monitor and track expenses and interactions in this area in accor-dance with the regulations.

Alexandra Caldwell, director of sales and

marketing, Claflin Company: Our reps are definitely aware of it. But it is more for manu-facturers, and more for companies that pay physicians for something, e.g., to act as a spokesperson for a product. If we do bring food in for a breakfast meeting with the doc-tor and staff, so we can educate staff members about a product, our reps know where the line is drawn, and that’s really all we ask. If they are trying to do something along these lines, we have them run it through management.

John Rademacher, president, ambulatory

care, Cardinal Health: We did go through a significant amount of training around the Sun-shine Act – what it means, and what our sales team’s responsibility is – to ensure they are in compliance. We feel we’re in a good position. But we continue to reinforce the training, and put systems in place to ensure our teams are working to the highest standards.

Sunshine Act: No big deal for distributors

The Physician Payments Sunshine Act requires manufacturers of drugs, medical devices and biologi-

cals to collect, track and report certain payments and items of value given to physicians and teaching

hospitals. But Repertoire readers say it really hasn’t affected their sales approach.

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Sysmex XS-1000i We round out our family with a compact 5-part diff analyzer that measures a mere 12.6” x 15.9” x 16.3” and weighs only 52.8 pounds. This closed-tube analyzer runs up to 60 samples per hour and requires just 20 µL of whole blood to deliver a 5-part WBC differential (NEUT + LYMPH + MONO + EO + BASO) with 21 testing parameters in all. It also records the last 10,000 samples performed, making look-ups a breeze. What’s more, it offers an optional autoloader for true walkaway capability.

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You can view videos of our growing family at www.youtube.com/user/SysmexAmericaInc/videos. To find out more about any of our Sysmex point-of-care analyzers, please contact Michelle Job at 224.543.9342.

© Sysmex America, Inc. All rights reserved.

Sysmex XP-300 Automated Hematology AnalyzerThis talented addition to our family weighs just 62 pounds and measures a compact 16.5” x 19” x 14”. It analyzes up to 60 open-tube samples per hour with the included barcode reader and graphic printer. Our new analyzer delivers an impressive 17 parameter CBC, including a 3-part WBC differential with an absolute neutrophil count (ANC) using an intuitive color touch screen.


trends

Antibacterial Soaps and Washes Under the MicroscopeBut the FDA’s proposed rule is an opportunity for reps to emphasize to customers the importance of buying healthcare-grade products

In December, the FDA issued a proposed rule to require manufacturers of antibacterial hand soaps and body washes to demonstrate that their products are safe for long-term daily use and more effective than plain soap and water in preventing illness and the spread of certain infections. Under the proposal, if companies fail to demonstrate such safety and effectiveness, these products would need to be reformulated or relabeled to remain on the market.

The important point for Reper-toire readers is this: The proposed rule does not affect hand sanitizers, wipes, or antibacterial products used in healthcare settings.

FDA’s rationaleAlthough consumers generally view

antibacterial hand soaps and body washes as effec-tive tools to help prevent the spread of germs, no evidence exists that they are any more effective at preventing illness than washing with plain soap and water, according to the agency. Further, some data suggest that long-term exposure to certain active ingredients used in antibacterial products – for ex-ample, triclosan (liquid soaps) and triclocarban (bar soaps) – could pose health risks, such as bacterial

resistance or hormonal effects.Under the proposed rule, man-

ufacturers who want to continue marketing antibacterial products in the consumer market will be re-quired to provide the agency with additional data on the products’ safety and effectiveness, includ-ing data from clinical studies to demonstrate that these products are superior to non-antibacterial soaps in preventing human illness or reducing infection.

Repertoire asked several manu-facturers of professional hand hygiene products to talk about the impact of the proposed rule – and attendant publicity – on their manufacturing or market-ing strategies, and how distributor sales reps should approach their healthcare customers.

The U.S. Food and Drug Administration’s proposed rule on consumer-oriented antibacterial hand soaps and body washes gives medical products sales reps one

more reason to urge customers to avoid running to the local Target or Costco for a deal on hand hygiene products.

Alcohol-based hand sanitizers have always been required to justify their efficacy prior to received approval from the U.S. Food and Drug Administration as a healthcare hand antiseptic.

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trends

A myriad of pathogens“The use of antibacterial and alcohol-based products in healthcare settings is appropriate given the inherent risk for highly virulent pathogen transmission,” says J. Hudson Garrett, PhD, vice president of clinical affairs, PDI. “Both the U.S. Centers for Disease Control and Prevention and The World Health Organization continue to recommend the use of an alcohol-based hand sanitizer with an alcohol concentration between 60 percent and 90 percent for use in healthcare settings when hands are not visibly soiled.

“Every day, healthcare providers are exposed to a myriad of dangerous pathogens including bacteria, vi-ruses, spores, and bloodborne pathogens. Because of the high-risk environment, a healthcare-grade hand antiseptic

should be used to protect the provider from this occupa-tional exposure. Alcohol-based hand sanitizers have always been required to justify their efficacy prior to received ap-proval from the U.S. Food and Drug Administration as a healthcare hand antiseptic. The FDA’s recent announce-ment is in alignment with requiring such efficacy data for soaps and body washes.”

Sales reps should carry this message to their custom-ers, continues Garrett. “Hand hygiene continues to be recognized as the single most important intervention in the reduction of healthcare-associated infections. This can be accomplished through traditional soap and water or an alcohol-based hand sanitizer when appropriate.

“Soap and water create a friction that removes pathogens from the hand, and the actual active ingredi-ent is a secondary effect. Alcohol-based wipes also create this friction, and therefore are used in healthcare settings when hands are not visibly soiled. The CDC continues to

recommend the use of an alcohol-based hand sanitizer with alcohol concentrations between 60 percent and 90 percent, and this recommendation is in alignment with the current evidence-based practices that exist for hand hygiene in healthcare settings.”

Rigorous demands of healthcare professionals“Clorox manufactures antimicrobial soaps under the HealthLink® and Aplicare® brands, used in both inpa-tient and outpatient healthcare settings,” says Lynda Lu-rie, healthcare marketing manager, The Clorox Company. “Although the current FDA Notice of Proposed Rule of consumer antimicrobial hand soaps does not affect prod-ucts used in the healthcare setting, it is our understanding

that the FDA intends to also study other consumer anti-microbial hand rubs and healthcare hand hygiene products in the future. Clorox will continue to meet the rigorous de-mands of healthcare professionals and fully comply with FDA rulings.”

Sales reps need to continue to stress to their custom-ers the importance of using products designed for the healthcare professional, says Lurie.

“It is important for healthcare professionals to use hand hygiene products that are manufactured for the healthcare professional and avoid consumer hand hygiene products in the healthcare setting.

“Many physician offices purchase consumer products out of convenience and/or lack of understanding of the differences between consumer and healthcare products,” she says. “Distributors can focus their customer conversa-tions on using hand hygiene products specifically designed for the healthcare professional.”

“ It is important for healthcare professionals to use hand hygiene products that are manufactured for the healthcare professional and avoid consumer hand hygiene products in the healthcare setting.”– Lynda Lurie, healthcare marketing manager, The Clorox Company

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trends

Historically, management of construction was left in the hands of local teams – comprising architects, contrac-tors and engineers – at the individual campuses, says Celeste West, vice president, supply chain. Without a standard pro-cess, the results were predictable: frequent contract discrep-ancies, inconsistent and unsatisfactory construction out-comes, missed delivery dates, owner-furnished-equipment (OFE) planning inadequacies, and missed opportunities.

Adventist contracted with a construction program management firm to introduce discipline and structure throughout its system. The firm was charged with assist-ing with contract management, developing and maintain-ing corporate qualification standards for design and con-tracting teams, and maintaining consistency throughout the system.

West saw an opportunity for the supply chain to help.

“Corporate Supply Chain integrat-ed into the process, initially focusing on partnering with the construction pro-gram management firm to help man-age the core construction teams, ensur-ing that preferred partner relationships were protected, working in tandem with third-party equipment planners

for medical equipment planning, developing initial processes with owner involvement, and building relationships,” she says. But she saw some further opportunities for supply chain.

“I envisioned the opportunity for someone on my team with construction-related experience to integrate into the ‘secret society of construction,’” she says. “Vision became reality, and the procurement manager position was created.” In 2008, Cheryl Smith was hired as procurement manager, construction management.

Smith has more than 25 years of construction indus-try experience, having worked in administration, account-ing and operational/project management at a general con-tracting firm, specializing in commercial construction; and a small custom residential design firm.

With the support of executive leadership, Smith has de-veloped Adventist Health System Supply Chain Construction

In 2006/2007, executives at Adventist Health System fore-casted over $1 billion for near-term future construction. The number wasn’t surprising, given that Altamonte

Springs, Fla.-based Adventist supports 44 campuses, from Florida to Wisconsin to Colorado; and employs close to 80,000 people.

Building BlocksThe economy and healthcare reform are shaping the future of hospital and outpatient facility construction


trends

Services. Her team – which also includes an equipment plan-ner and facilities technology architect – is responsible for overall management of in-house planning for all owner-furnished equipment, including medical equipment, IT/telecommunications, furniture, artwork, etc.

The marketManaging big construction and renovation projects is more important than ever, given tightening money sup-plies, questions surrounding the impact of healthcare re-form, and the complexities of mergers and acquisitions, according to those who spoke with the Journal of Healthcare Contracting, a sister publication to Repertoire.

Healthcare construction has slowed down in the recent past, says Jeff Stouffer, principal and senior vice president, HKS Architects, Dallas, Texas. “There are fewer large-scale projects than we saw a couple of years ago, and we definitely notice more renovation.” The economy is partly to blame, and access to money is tight. What’s more, questions about the impact of healthcare reform are giving healthcare executives pause.

The economy has definitely cut back construction projects, adds Chad Beebe, direc-tor of codes and standards for the American Society for Healthcare Engineering, a personal membership group of the American Hospital Association. But activity has been climbing steadily – if slowly – for the past couple of years. Much of that activity is renovation. “That’s because the cost of infrastructure is so high,” says Beebe. At anywhere from $300 to $1,000 a square foot, building on a hospital campus is expensive. “So you try to stay within your exist-ing footprint and maximize your space.”

“There is a lot of discussion – and a lot of uncertainty – about what healthcare reform might do,” says Beebe. Some designers are guessing that one immediate impact of reform might be an influx of patients into the emergency depart-ment. “We may see an initial surge, as more people become insured,” he says. But presumably, those patients will learn that routine medical services are best provided in non-ER settings, such as community centers and doctors’ offices.

Planning aheadGiven questions surrounding the economy, healthcare reform and market dynamics, healthcare executives and architects are trying to maximize the adaptability of the structures they build or renovate, says Stouffer.

Designing for maximum flexibility might mean antici-pating changes in the OR, he says. “Just a few years ago, you

would never have heard of an MRI in an operating room. Now it’s common practice.” If the movement toward out-patient care continues, it’s reasonable to assume that patients in inpatient facilities will be more critical than those in years past. “So when designing a facility, you may need to design all the rooms to accommodate critical care.” Designers face another challenge – creating facilities whose infrastructure can accommodate tomorrow’s IT technologies.

“The key is designing the future state before you de-sign the building,” says Stouffer.

One more change Stouffer notes is that toward lean project delivery. “The construction and design industry, which hadn’t done much innovating in 50 years, is start-ing to create a more efficient way to design and deliver the project.” General contractors, subcontractors, design teams, architects, engineers and others are collaborating to deliver

projects better, quicker and less expensive. Prefabrication can help save money, improve quality, and speed up projects.

Three strategies for supply chainSupply chain executives can play a key role in pre-con-struction and pre-renovation activities.

“Many of the standard divisions of construction spec-ifications include areas of work in which Adventist Health System contracts directly with manufacturers/vendors,” says Smith. Examples include ceiling tile, drywall, paint, elevators, roofing, building environmental systems, floor-ing, lamps and ballasts, to name a few. These are typically included in the scope of work carried by the construction manager/general contractor.

Adds West, “Prior to AHS oversight, our experience was that design teams often did not specify appropriate products or manufacturers/vendors as contracted by AHS. [As a result], we were not able to validate that pricing was accurate per contracts, or that appropriate contracts were being honored; and it was difficult to capture the spend of material, particularly in these categories, which was creat-ing missed opportunities for reported sales to Premier.”

“AHS involvement has ensured preferred partner par-ticipation and monthly tracking of construction manager/general contractor procurement and reporting of material bought, and cost,” says Smith.

“ There are fewer large-scale projects than we saw a couple of years ago, and we definitely notice more renovation.”

– Jeff Stouffer


disease states

Colorectal Cancer

Although colorectal cancer

– or colon carcinoma – is

one of the leading causes of

cancer-related deaths in the United

States, early diagnosis can often

lead to a complete cure, according

to the National Institutes of Health

(NIH). The disease originates in

the large intestine – or colon –

or in the rectum (the end of

the colon), and nearly all

incidents begin as benign

polyps, which slowly de-

velop into cancer.

Early detection and diagnosis can often lead to a cure.

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disease states

There is no single cause of colorectal cancer, although the NIH notes that people run a higher risk of developing the disease if they:

• Are older than 60.• Are African American, or of Eastern European descent.• Eat a lot of red or processed meats.• Have colorectal polyps.• Have inflammatory bowel disease, such as Crohn’s disease or ulcerative colitis.• Have a family history of colorectal cancer.• Have a personal history of breast cancer.• Smoke or drink excessively.

Sometimes inherited diseases, such as familial adenomatous polyps or hereditary nonpolyposis colorectal cancer (Lynch disease) can also increase one’s risk of developing colorectal cancer. And, some studies suggest that high-fat, low-fiber diets play a role, although this link is less clear.

The disease progresses through five stages:• Stage 0: Very early cancer appears on the

innermost layer of the intestine.• Stage I: The cancer is in the inner layers of the colon.• Stage II: The cancer spreads through the muscle

wall of the colon.• Stage III: The cancer spreads to the lymph nodes.• Stage IV: The cancer spreads to other organs

outside the colon.

Depending on how far the cancer has progressed, it may be treated with surgery, chemotherapy, radiation or a combination of treatments. When the cancer is caught in stage 0, the cancer cells often can be removed using a colo-noscopy. Once the disease has progressed, a colectomy is required to remove the cancer cells, along with chemother-apy and/or radiation. Blood tests often are used to detect tumor markers during and after treatment.

Testing for colon cancerToday, physicians can catch early signs of colorectal can-cer using an immunochemical fecal occult test (iFOBT)

– or fecal immunochemical test (FIT) – to detect small amounts of blood in the stool, along with a colonoscopy. In some cases, physicians opt to perform a sigmoidoscopy to screen for colorectal cancer or polyps. Blood tests, such as a complete blood count to detect anemia and liver func-tion tests, may also be used.

Distributor sales reps can service their physician customers by ensuring they are equipped with the right tools to test their patients regularly for colorectal cancer. Fecal immunochemical tests are antibody-based tests designed to screen for blood in the stool. Primary care physicians (e.g., internists, general practitioners and family physicians), gastroenterologists and OB/GYNs usually perform FITs as an annual screening in their offices, however the test also is used in laborato-ries and hospitals. Patients generally are screened begin-ning at age 50, unless they have a family history of a gastrointestinal disorder. The American Cancer Society Guidelines for the Early Detection of Colorectal Can-cer recommends that patients also use the multiple-day stool take-home test, as one test performed in the phy-sician’s office is not adequate.

For more information on FITs, read this month’s Tech Talk on colorectal cancer screening.

Causes

Primary care physicians (e.g., internists, general practitioners and family physicians), gastroenterologists and OB/GYNs usually perform

FITs as an annual screening in their offices, however the test also is used in laboratories and hospitals.

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disease states

Patients in Oklahoma City and environs can secure upfront, bundled pricing for colonosco-pies following an agreement signed in De-cember between Digestive Disease Specialists Inc. – a large physician practice in Oklahoma City – and MDSave, a healthcare e-commerce company based in Brentwood, Tenn.

The bundled price includes all costs associat-ed the colonoscopy, including facility fee, physi-cian fee, lab fee and anesthesia fee. MDSave says the price is as much as 60 percent less than what the procedure would cost if billed traditionally.

The MDSave and DDSI partnership en-compasses DDSI’s two ambulatory endoscopy centers and six other locations in Oklahoma City,

Yukon, Northwest Oklahoma City, Edmond and Midwest City. In addition to colonoscopies, pa-tients can use MDSave to lock in on new-patient office visits, endoscopies, flexible sigmoidosco-pies and a hemorrhoid banding procedure.

“Our focus is not just on uninsured patients, but any patient who has a high deductible, but has not yet met it,” or who pays in cash, says MDSave CEO Paul Ketchel, who co-founded MDSave in the fall of 2012.

MDSave is able to secure good pricing from providers for a couple of reasons, he says. “Because we’re taking an upfront payment and helping bundle it, we take cost out of the sys-tem [in terms of ] debt collection, lab fees, claims processing fees. We think 30 to 40 percent of healthcare charges are tied up in billings, claims and collections. When you get through all that,

we pass those savings on to patients. It makes the whole process faster, cleaner.”

The advantage for patients isn’t just a lower price, but convenience and predictability, adds Ketchel. “Knowing what a procedure will cost gives patients certainty. For a lot of patients, the fear of never-ending bills coming a year after a procedure causes anxiety.”

Something new for providersFor providers, negotiating upfront, bundled payments is something new, says Ketchel. “It’s just changing the traditional way of thinking about things.

“Many believe that pricing transparency will precipitate a race to the bottom in pricing,” he says. But in fact, after they look closely at their current costs, time and reimbursement, “most providers find they end up making as much or more with a bundling approach, and they get paid faster. MDSave

itself collects payment from the patients, then seg-ments it among the providers and facilities, based on pre-agreed parameters. “That’s the key – using technology to take out a lot of these processes and lower costs,” says Ketchel.

Launched in the fall of 2012, MDSave has already signed an agreement with SSM Health Care Oklahoma, encompassing more than 225 health-care providers across 20 locations, and more than 200 procedures and services, including mammo-grams, flu shots, strep tests and wellness visits.

Prior to co-founding MDSave, Ketchel was chief operating officer of Diagnostix Network Alliance, a molecular testing company. Before that, he served as Southeast director for Ameri-can Capital Group, a government relations and federal affairs firm representing healthcare and pharmaceutical clients.

Upfront price for colonoscopies

The advantage for patients isn’t just a lower price, but convenience and predictability.


tech talk

Screening for Colorectal CancerColorectal cancer is one of the most commonly diagnosed diseases, but also one of the easiest to prevent.

One of the early warning signs of the disease is hid-den (or occult) blood in the stool, which can be detected by a fecal occult blood test. For over 40 years, guaiac fecal occult blood tests (gFOBTs) have been available, which are based on the oxidation of guaiac by hydrogen peroxide to a blue-colored compound. A positive gFOBT may be due to bleeding in the upper and/or lower gastro-intestinal tract and does not necessarily indicate colon

cancer. In addition, gFOBT is not specific for human hemoglobin. Certain foods and medications can interfere with the accuracy of the test results.

Immunochemical fecal occult tests (IFOBT) – also called fecal immunochemical tests (FIT) – have

been available for the last 14 years. They are said to be more sensitive and specific to human hemoglobin and do not involve the dietary or medicine restrictions indicated by guaiac tests. Although FITs do not detect upper gastro-intestinal bleeding, they can be used to determine lower gastrointestinal bleeding indicative of colorectal cancer. FITs can also be used to screen for polyps, diverticulitis and colitis.

Colorectal cancer is one of the most commonly diag-

nosed cancers and the third leading cause of cancer

death for all Americans, according to the Centers for

Disease Control and Prevention. And yet, a simple screening

test is often all it takes to prevent the disease from developing.


tech talk

In spite of the benefits of FITs, some physicians continue to rely on digital rectal exams (DRE) to screen for colorectal cancer. However, medical guidelines warn against us-ing DREs, as they tend to generate negative results, and some studies suggest these patients have nearly the same likelihood of having ad-vanced neoplasia as patients who do not undergo any stool testing.

How the test worksFecal immunochemical tests are antibody-based tests designed to screen for blood in the stool. They may be used to determine gastro-intestinal bleeding found in sev-eral gastrointestinal disorders, in-cluding colorectal cancer, polyps, diverticulitis and colitis. Primary care physicians (e.g., internists, general practitioners and family physicians), gastroenterologists and OB/GYNs usually perform FITs as an annual screening in their of-fices. The test also is used in labo-ratories and hospitals. Patients generally are screened beginning at age 50, unless they have a family history of a gastrointestinal disorder. The American Cancer Soci-ety Guidelines for the Early Detection of Colorectal Cancer recommends that patients also use the multiple-day stool take-home test, as one test performed in the physician’s office is not adequate.

The fecal immunochemical test is a one-step lateral flow chromatographic immunoassay test. Depending on the test, the patient generally takes a collection de-vice home to collect his or her stool, and then returns the device to the physician’s office. The fecal sample is applied to a dry sample collection card, or it is sus-pended in a liquid and placed into a cassette for testing and results.

How to sellA good number of physicians today continue to rely on traditional guaiac tests, and convincing them to switch to fecal immunochemical tests can sometimes present a challenge. True, FITs cost the physician more money upfront, but they offer greater clinical sensitivity and

specificity and, as such, a valuable service to patients. In order for physicians to be reimbursed for either test, the patient must return the collection device with his or her stool sample. However, guaiac tests are associated with low reimburse-ment rates, and some doctors do not bother to file.

To successfully convert ac-counts from guaiac to FITs, sales reps should be prepared to discuss technology and performance, as well as reimbursement and costs. They should separate the patient take-home collection cost from the total cost of the test. In spite of the higher cost of FITs, reimbursement is sig-nificantly higher, making this option economically feasible. (Again, physi-cians are reimbursed only when the patient returns his or her sample and the development portion of the test is completed.)

Sales reps should approach their physician customers with the fol-lowing questions:

• “How many patients at risk for colorectal cancer do you see each year?”

• “How do you currently address colorectal cancer with these patients?”

• “Are you interested in expanding your use of rapid tests?”• “Do you currently use guaiac tests or fecal

immunochemical tests for colorectal cancer screening?”• “Are you aware of the benefits of fecal

immunochemical tests?”

In addition, they should educate their customers on variations in manufacturer recommendations, as well as the American Cancer Society colorectal cancer screening guidelines. (In the past, some FITs have been FDA-cleared without indicating the number of samples required in the 510(k) documents.)

In some cases physicians are under contract to refer their patients to a lab for fecal immunochemical testing. In general, however, many doctors can test in-house.

FITs have been reimbursable by Medicare since 2003. Reimbursement rates may vary by region or insurer.

To successfully convert accounts

from guaiac to FITs, sales reps should

be prepared to discuss technology and performance,

as well as reimbursement

and costs.

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healthy reps

As a distributor sales rep, you are always ready to help your physician customers find the

best solutions to ensure the health of their patients. But, when did you last take time to consider your own health? March is Colorectal Cancer Awareness Month – an opportunity to initiate a discussion with your customers of the importance of educating and test-ing patients – including yourself – for early signs of the disease.

Colorectal cancer is the second most common cancer in the United States, according to the American So-ciety of Colon and Rectal Surgeons (ASCRS). One of every 20 individu-als is at risk of developing the disease. The earlier it’s detected, the greater the odds of being cured.

The risk of developing colorectal cancer increases if there is a family history of colorectal polyps or cancer. For those with a personal history of breast cancer, uterine cancer, ovar-ian cancer, or extensive inflamma-tory bowel disease, the odds are even greater. Indeed, of the 140,000 new cases of colorectal cancer diagnosed each year, about 56,000 people die of the disease.

Between 80 and 90 percent of patients can be restored to normal health when colorectal cancer is detected in its earliest stages, notes the ASCRS. This rate drops to 50 percent or less once the cancer has progressed.

Colorectal Cancer Awareness MonthMarch is the month to remind your customers of the importance of testing patients for early signs of disease. It’s also a good time to consider your own health.


healthy reps

The ASCRS recommends several prevention techniques, including regular screenings, a healthy diet and regular exercise. If detected, colorectal cancer requires surgery in nearly all cases for a complete cure, sometimes in conjunc-tion with chemotherapy and radiation. However, between 80 and 90 percent of patients can be restored to normal health when the cancer is detected in its earliest stages, notes the ASCRS. This rate drops to 50 percent or less once the cancer has progressed.

ASCRS recommends that physicians begin by screening patients with an iFOBT test. However, the society is clear that, while an iFOBT is a good starting point, it does not always detect cancer, and most polyps do not bleed enough to be detected by this test. Follow-up flexible sigmoidoscopy testing permits the physician to look directly at the lining of the colon and rectum.

Or, a colonoscopy – which the society considers a more accurate follow-up than flexible sigmoidoscopy – can be used to diagnose colon and rectal prob-lems and to perform biopsies and remove colon polyps.

The ASCRS recommends non-high-risk patients receive an annual digi-tal rectal examination and iFOBT test, beginning at age 40. Beginning at 50 years of age, they should also have a flexible sigmoidoscopy test every five years or a colonoscopy every 10 years. Patients at higher risk require more frequent surveillance per their physician’s recommendation.

Lowering one’s risk It’s never too late to take a healthy outlook. The ASCRS recommends six steps to lowering one’s risk of developing colorectal cancer:

• Get regular colorectal cancer screenings beginning at age 50. (If you have a personal or family history of colorectal cancer or colorectal polyps, or a personal history of another cancer or inflammatory bowel disease, talk to your doctor about earlier screening.)

• Eat between 25 to 30 grams of fiber each day, including fruits, vegetables, whole grain bread and cereals, nuts and beans.

• Eat a low-fat diet.• Eat foods with folate, such as leafy green vegetables.• Drink in moderation. (Alcohol and tobacco in combination are linked

to colorectal cancer and other gastrointestinal cancers.)• Exercise. Even moderate exercise, such as walking, gardening or

climbing steps may help reduce one’s risk.

Colorectal cancer can affect anyone, and the odds increase with age. However, some people are at great risk, according to the American Society of Colon and Rectal Surgeons, including people with a personal or family history of:• Benign colorectal polyps

or colorectal cancer.• Inflammatory bowel

disease, such as ulcerative colitis or Crohn’s.

• Ovarian, endometrial or breast cancer.

People of African American and Hispanic descent, who often are diagnosed at a later stage of the disease, are considered at higher risk, as are people over age 50. When detected early, however, the disease is easier to treat and often curable.

Are you at risk?

The ASCRS recommends non-high- risk patients have an annual digital rectal examination and iFOBT test, beginning at age 40. Beginning at

50 years, they should also have a flexible sigmoidoscopy test every five years or

a colonoscopy every 10 years.


long-term care trends

Liability Costs IncreasingRising liability costs threaten long-term-care providers in 2014. For sales reps, this is an opportunity to help customers focus on cost savings solutions.

According to the 2013 Long Term Care General Li-ability and Professional Liability Actuarial Analysis, the projected national 2014 loss rate (a combination of claim severity and frequency) is $1,940 per occupied bed. This means a provider with 100 beds can expect as much as $194,000 in liability expenses in 2014.

Loss rates reportedly will vary from one state to the next. For instance, Kentucky’s loss rate reportedly has been rising since 2008 and is projected to reach $8,090 in 2014 – among the highest loss for states profiled in the study. Texas reports some of the lowest loss rates – about $300 per occupied bed.

Key findingsBased on the actuarial analysis of general liability and professional lia-bility claims data from long-term-care providers across the country, AHCA reports the following:

• In addition to long-term-care loss rates increasing by 5 percent annually, long-term care frequency is increasing by 2 percent each year.

• Overall long-term care severity (that is, average size of claims) is increasing by 3 percent each year.

• The forecasted 2014 accident year long-term-care general liability/professional liability severity is $213,000 per claim limited to $1 million per occurrence.

• Claims resolved with arbitration agreements in place are 16 percent less costly than claims resolved without arbitration agreements in place.

• Claims from Medicaid residents are less frequent and with lower severity than claims from other types of residents.

Not only are liability costs for long-term-care providers expected to in-

crease by as much as 5 percent this year, the frequency of claims may

rise as well, according to a report by the American Health Care Associa-

tion (AHCA) and Aon Global Risk consulting. This could drive up the costs of doing

business for long-term-care and post-acute care centers, which provide care for

roughly 1.1 million frail and elderly and employ over 1.5 million people across the

country, says AHCA. The more distributor sales reps can do to provide value-added

service and cost-saving solutions, the greater chance their long-term-care custom-

ers stand of weathering the financial storm.

A AHCA report, A Report on Shortfalls in Medicaid funding for Nursing Center Care, estimates the 2013 Medicaid shortfall will exceed $7.7 billion nationally, or $24.26 per Medicaid patient. That’s an 8.6 percent increase over the previous year. In fact, for every dollar of allowable cost incurred for a Medicaid patient in 2013, Medicaid programs reimbursed, on average, about 88 cents, the report states. In addition, with recent Medicare rate reductions, Medicare no longer fully subsidizes increasing Medicaid shortfalls.

For a typical 100-bed facility in which 63 percent of residents rely on Medicaid for coverage, this shortfall would mean a loss of more than $550,000 annually, according to the report.

For more information visit http://www.ahcancal.org/News/news_releases/Pages/ Medicaid-Underfunds-Nursing-Care-to-its-Highest-Deficit-Ever-.aspx.

For more information visit http://www.ahcancal.org/News/news_releases/Pages/ Liability-costs-on-the-rise-for-long-term-care-facilities,-finds-AHCA-and-Aon.aspx.

Medicaid shortfall higher than ever


SmartwatchFor those who would like to have the world at their fingertips – or at least their wrist – Martian Watches™ has introduced its Martian Notifier™ line of smartwatches. The $129 Mar-tian Notifier line features an analog design, customizable vibration patterns and an integrated OLED readout said to

deliver real-time alerts and notifications, including caller ID, calendar, weather, texts, email (POP or IMAP), Facebook, Twitter, Instagram, games, bank alerts, fitness stats, news headlines and other alerts permitted by users’ smartphones. Vibration patterns for each type of alert are set using the free Martian App on users’ smartphones, alerting them of new emails, text messages or news alerts. A Martian Noti-fier App reportedly can filter the types of notifications they receive, as well as recall past notifications for a quick review.

In addition, Martian Notifier features a notifier but-ton, which activates users’ smartphone speakerphone, en-abling voice commands to control music, check a sports score, get directions, search the web, create a reminder or appointment, and more. The Martian Notifier features anti-scratch acrylic crystal and accurate quartz movement and is reportedly splash-resistant.

Wearable technology Are consumers taking note of the growing wearable technology market? According to the NPD Group’s new Wearable Technology Study, they are indeed. About 52 percent of consumers say they’ve heard of wearable technology devices such as smart glasses, smart watch-es, and wearable fitness tracking devices, the study re-ports. Among those aware of the devices, one-in-three say they are likely to buy one of them. Wearable fitness devices, such as the Fitbit and Jawbone UP, have gained the highest level of awareness among consumers.

According to the study, one in three consumers say they have heard of wearable fitness trackers; among those consumers, 28 percent say they are likely to buy a de-vice. Features such as calorie counting and step tracking appear to be highest in demand. Despite being newer to the wearables market, smartwatches have gained greater attention than other categories. Thirty-six percent of those polled say they are aware of the devices; how-ever, given the limited number of products currently available, only 23 percent say they are likely to buy one. Among those who intend to purchase one, the ability to make and receive phone calls is most important. Lis-tening to music and fitness tracking also appear to be priorities. When polled about factors that would pre-vent them from buying a smartwatch, participants in the study most commonly cited the bulk or size of the device, short battery life, and an easily-damaged screen. On average, consumers who intend to buy a smartwatch say they expect to spend just under $300. Finally, al-though smartglasses are not yet available to consumers, they already are on their radar. Twenty-nine percent of consumers report to be aware of smartglasses, and one in five expect to buy the device. They are interested in devices that permit them to make and receive calls, browse the web, and take photos and videos. Finally, among consumers aware of smartglasses, 50 percent say the look/design of the device is an important factor in their decision to buy the device. Design appears to be slightly less important for consumers of smartwatches, and much lower for fitness trackers.

Come in out of the rain. Or not. MarBlue has introduced the Dry-suit Convertible, a waterproof case for the iPhone 5/5s. The patent-pending case, designed for easy re-moval, reportedly protects against a variety of factors, including water, shock, dust and snow. It is said to be fully functional with the Touch ID fingerprint sensor, even with the waterproof case.

Editor’s note: Technology is playing an increasing role in the day-to-day business of sales reps. In this department, Repertoire will profile the latest developments in software and gadgets that reps can use for work and play.

Quick Bytes

www.repertoiremag.com • February 2014 55

Quick Bytes

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Easy listening Sennheiser has introduced its MM 30G in-ear head-set, compatible with the latest generation of Samsung Galaxy smartphones. The MM 30G’s three-button in-line remote control features play and pause tracks, and reportedly permits users to take calls on their Samsung mobile phone, without having to physically answer it. The in-line remote control also permits us-ers to remotely set or change the volume level. Phone conversations can take place without having to turn off the music.

Heart healthySalutron Inc. has introduced its LifeTrak series, a line of waterproof physiological monitoring devices that reportedly do not require charging. LifeTrak devices en-able users to check their resting heart rate and calculate their fitness age. The newest addition to the series, the Zone R415, is said to be the only waterproof activity tracker on the market that features smartphone notifica-tions and heart rate monitoring. Data may be stored on the LifeTrak device, as well as be synced to apps such as MapMyFitness, Argus, AnD Wellness Connected (ex-pected in April 2014) and others. Other features include:• Automatic sleep monitoring.• Intelligent wakeup vibration alarm.• Bluetooth® connectivity.• OPEN API development platform.• Calorie tracking.• Step counting that reportedly distinguishes walking,

running and other activity.• Distance calibration.• Time, day and date settings with AM/PM

or 24-hour time format.

Smartphone lensesSchneider Optics, makers of the iPro Lenses for smart-phones, announced that the system now is compatible with more devices, including iPhone 5, 5S, and 4/4S, Samsung Galaxy S4, and the iPad Mini. The iPro Lens System is designed to facilitate professional quality pho-tographic and video imagery with smartphones and iPads by adding interchangeable Macro, Wide Angle, Super Wide, Fisheye, and Telephoto lenses. Custom-de-signed cases for the Galaxy S4, and the iPhone 5, 5S, and 4/4S, are available. In addition, the new iPro Lens Mini Clip is designed to securely fit the iPad Mini, reportedly enabling interchangeable use of the same iPro lenses on either the iSight Camera or the Facetime camera.


WindshieldtimeChances are you spend a lot of time in your car.

Here’s some automotive-related news that might help you appreciate your home-away-from-home a little more.

Staying connectedBy 2020, Visteon anticipates that over 50 billion devices will be connected to a multi-disciplinary ecosystem. The company is readying itself to meet the demand with its OpenAir™ brand of connected audio and infotainment products, developed in partnership with Compuware. Designed with open architecture, human-machine in-teraction (HMI) command and controls, and off-board wireless data connections, OpenAir™ is said to deliver flexible multi-device connectivity and advanced infotain-ment solutions. The OpenAir™ A1.0 connected audio solution, recently launched for a global vehicle manufac-ture, reportedly delivers Bluetooth®, voice control and integrated smartphone connection to Cloud applications, for multiple, high-volume vehicle platforms. In addition, in collaboration with Cisco, Visteon has introduced OA-SIS (optimized, adaptable, secure, intelligent and seamless connectivity), designed to protect the vehicle communica-tion network by ensuring vehicle connectivity to the user and Cloud computing. A secure data pipe actively switches methods (modem, phone tether or Wi-Fi®) to maintain a seamless connected experience to the Cloud. The cockpit is adaptable through personalization options, off-board computing and over-the-air updates.

Plug-in’s take the roadThe Electric Drive Transportation Association (EDTA) recently released 2013 year-end sales data for

the electric drive industry, including numbers for hy-brid, plug-in hybrid, extended range and battery elec-tric vehicle sales. Results show that hybrid sales totaled 495,530, a 14 percent increase over the 2012 sales. At the same time, 9,790 plug-in vehicles (including plug-in hybrid, extended range and battery electric vehicles) were sold in December, bringing 2013 total sales to 96,702 – an 83 percent jump over the 2012 sales. Since the market rollout at the close of 2010, there have been 167,617 plug-in vehicles sold across the nation, EDTA reports.

Driverless shuttleInduct has announced the U.S. launch of Navia, an intelligent, electric and driverless shuttle. Already de-ployed in Switzerland, the UK and Singapore, the Navia self-driving shuttle is designed to safely navigate con-gested streets without the use of a rail or designated path. By utilizing advanced robotics, laser mapping technology and sensors that detect the vehicle’s accel-eration and rotation, Navia reportedly can calculate its position, nearby obstacles, route and distance traveled in real time, enabling it to carry its passengers quickly, safely and efficiently. Navia can be set per a specific schedule and route, or users can select their stop from a touch screen.

Designed to produce zero emissions, the Navia shut-tle has seating for eight and reportedly can travel up to

Green Hybrid sales increased 14 percent over 2012 sales. Plug-in vehicles

saw an 83 percent increase.

HOSPITALS

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Welch Allyn and you. One team. One goal.Improving outcomes across the continuum of care.

With the broadest range of connected devices and EMR partners and our extensive support teams, together we can help to improve the patient care experience for everyone.

Visit the Vitals for Success Portal to access your tools atwelchallyn.com/distributor.

©2013 Welch Allyn MC10789


12.5 mph. Fully electric, the vehicle is recharged by induction (using mag-netic fields), and does not require cables or human intervention.

Safe travelsVOXX Accessories corp., a wholly-owned subsidiary of VOXX In-ternational Corp., has launched its Champ line of Emergency-Pre-paredness Gear for drivers, with the introduction of three products: the Survival Sidekick with integrated Weather Radio, the Bodyguard Bat-tery Backup and the Survival Skybox Portable AM/FM/NOAA Weather Radio with Bluetooth Speakers. The Champ Survival Sidekick 10-in-1 multi-tool features a distress light and magnetic base to serve as a bea-con on the roadside; a seatbelt cutter and glass breaker for escaping a ve-hicle; and a mobile device charging outlet for emergency power when one’s cell phone is running low.

The Survival Sidekick report-edly will be available in April 2014, at a suggested price of $49.99. The Champ Bodyguard Battery Backup, also expected to be available in April, features a built-in flashlight and personal alarm, with a 90db siren to signal for help. It will retail for a sug-gested price of $34.99. Finally, the Champ Survival Skybox Por-table AM/FM/Weather Radio with Bluetooth speakers features alert capability, as well as allows users to wirelessly stream music or other audio from their smartphone. The Survival Skybox, also available in April, will reportedly deliver weather and news updates, even when other sources are down, mobile device charging, a built-in flashlight with emergency beacon, and time/date and temperature info. It will retail for a suggested price of $99.99.

Not only should drivers carry these items, they need to check periodically that their supplies are working. Thirty-one percent of drivers say they only check once a year, and 32 percent say they have never checked at all.

• Jumper cables

• Spare tire

• Hazard triangle/road flares

• Flashlight

• First aid kid

• Windshield scraper.

• Water and non-perishable food

• Blanket

• Cell phone and charger

• Road salt

• A tarp for kneeling in snow

Only 5 percent of drivers carry a full range of recommended emergency items, such as:

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Connected car solutionsAT&T has announced two initiatives in the connected car market: a connected car center in Atlanta, called the AT&T Drive Studio, and a modular, global automotive platform, called AT&T Drive. The 5,000+-square foot AT&T Drive Studio, designed to integrate solutions across multiple companies, reportedly features work-ing garage bays, a speech lab, a full showroom, con-ference facilities, and more. The company’s connected car platform, AT&T Drive, is a modular, global solu-tion designed to allow automakers to pick and choose what services and capabilities are important to them, in order to differentiate their solutions in the market-place. The platform is said to offer such solutions as connectivity, billing, data analytics, safety, diagnostics, infotainment and more.

Don’t get caught withoutA recent survey by State Farm and KRC Research shows 67 percent of drivers keep non-emergency items in their trunk, including car detailing equipment, toys

and used food or drink containers. (The report also mentions an old gorilla costume, an inflatable sheep, and a wedding dress, among other unconventional items.) State Farm recommends purging the non-es-sentials and adding the emergency supplies that can help drivers safely and efficiently deal with the un-expected. Indeed, when it comes to being prepared for roadside emergencies, men are more likely than women to have at least one of the essential supplies in their trunk, according to the survey. Essentials in-clude jumper cables (64 percent of men vs. 53 per-cent of women), a flashlight (62 percent of men vs. 48 percent of women), and a first aid kit (47 percent of men vs. 40 percent of women). Men also appear to be more likely than women to check their vehicle’s emergency supplies (81 percent of men vs. 53 per-cent of women). And, when it comes to hoarding junk, the survey suggests that parents (77 percent), younger drivers (79 percent) and middle aged drivers (73 percent) rank higher than non-parents (62 per-cent) and older drivers (58 percent).


repcornerLess Talk, More SalesFrom kitchen design to medical products, Al Frere knows successful selling is about letting the customer close the deal.

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Al Frere, Henry Schein Medical FSC and wife, Shirley and children Maya, Henry and Sunny.

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Al Frere is a salesman, as was his father before him. But, despite all he learned from

his father, little could have prepared the Henry Schein Medical field sales consultant for his early experience selling kitchens. “The way I looked at it, I wasn’t a designer but a salesper-son,” he says. “By 7:00 a.m., I would have a list of leads, [some of them] three hours away.” In the kitchen de-sign business, “once you meet with a lead, you need to close on the spot,” he explains, and that means creat-ing a sense of urgency.

“The key was to make the sale so appealing that the customer wanted it,” he continues. After all, it wasn’t unheard of for customers to rethink their or-der and cancel it the following day. “This was a one-call-close business.” Challenging as that sounds, he was successful. “This was a tough business, but I was a 20 percent closer. One of every five people I met with, I was able to close on the spot.”

95 percent listeningFrere attributes part of his success in sales to his father, Al Frere Sr. “My father, who is now 85 years old, was a life insurance salesman,” he says. “When I was six or seven, I would join him on his sales calls.” Frere says his father’s “love of people” really stood out. Whether Frere Sr. was calling on customers in poor neighborhoods or wealthy ones, “he treated everyone the same: with respect.

“[My father] did not go far with his formal education, but he was a mesmerizing speaker,” Frere continues. “He knew how to listen to his customers. This business is 95 percent listen-ing. If you talk all of the time, you won’t sell


repcorner : Al Frere

“I may not be the guy who knows everything about everything. But, I do know how to listen to

my customers and understand their needs. I know how to follow through and take care of them.”

a thing.” Particularly with kitchen design sales, where customers can easily change their minds about their purchase, “you essentially want your customer to close the deal himself.”

Frere also found it helpful that he worked for a com-pany with a good name, a good product and a lot of in-tegrity. In fact, “it makes a huge difference when people don’t have to worry about the integrity of the product,” he says – something that attracted him to Henry Schein five years ago. Still, selling kitchen designs wasn’t only men-tally strenuous, but physically exhausting, he says. “[On any given day], I may have had leads at 10, 3 and 7 that evening. If I had a 7:00 p.m. meeting that was three hours away, I some-times didn’t get home until 2:00 in the morning. Then I had to start again at 7:00.

“It got to be very challeng-ing,” he continues. “The job was a lot of pressure and a lot of miles. I think I added about 45,000 miles a year on my car!” Add to this his young family – his wife, Shirley and children Maya, Henry and Sunny – and he knew he wouldn’t be able to keep up the pace forever.

All about the peopleDespite the grueling pace, the time Frere spent with his cus-tomers was energizing. “What turned me on the most about this experience (and later in-fluenced him to join Henry

Schein) was the people,” he says. “You can imagine how many different people I met, and I learned that you truly cannot judge anyone.

“I remember one lead I had in Ocala, Fla.,” he contin-ues. “It was a 3 ½-hour drive to the middle of nowhere.” It was horse country, he adds. “I ended up at a trailer on a horse farm. My car was worth more than this trailer, which had a plywood floor that wasn’t even nailed down. And, I had spent all day trying to find this place!”

As it turned out, however, his customer was one of the nicest people Frere came across in his years in sales. “He had brought his mother to live with him, and she wanted a new kitchen,” he recalls. “He was will-ing to do anything to take care of his mom. In the end, they pur-chased a new kitchen and an air conditioning unit. And, he count-ed out his [deposit] in cash!”

Switching gearsAs the economy began to lag and the housing crisis loomed, Frere knew a change was imminent. “I stayed with that company for five years,” he says. “But, as we entered the housing crisis, I went from having three good leads each day to one [not so good] lead. Clearly, he no longer could depend on his job to support a family of five, he points out.

“My brother-in-law, Troy Gale, had been a sales con-sultant with Henry Schein for many years, and he was able to

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can learn to do better in my

position.”


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introduce me to the right people.” As luck would have it, there was an opening in a local territory. Frere went from a job where he never knew where he’d be from one hour to the next, and where he might easily go for three weeks at a time without making any money, to a stable career, he recalls.

Joining Henry Schein has more than paid off, says Frere, noting he continues to enjoy working in a relation-ship-based business. His background has prepared him well, he says. “I graduated from college with a degree in psychology and worked in a home for at-risk youth in Denver, Colo., for five years,” he says, explaining that part of his job involved talking kids out of “bad situations,” which was very much like sales. On weekends, to help pay his bills, he sold cars. “I was great at this and knew back then that sales was for me.”

After car sales, he briefly sold life insurance be-fore joining the kitchen design industry. “I miss the excitement and unpredictability of my past experi-ences,” he says. Still, he values the stability of his current role as a medical products sales rep, particu-larly for a company that has “a great name and in-tegrity,” he points out. He continues to thrive on his customer relationships.

“I may not be the guy who knows everything about the industry,” he says. “But, I do know how to listen to my customers and understand their needs. I know how to follow through and take care of them.

“My dad taught me how not to be a know-it-all,” Frere continues. “There’s always opportunity to learn more. There’s always something I can learn to do better in my position.”

“If you talk all of the time, you won’t sell anything.”


newsHealth o meter® Professional Scales honors lifetime employee

Pelstar LLC, manufacturer of Health o meter Professional scales, honored lifetime employ-ee Bob Hoffman for his 43 years of service to the company. Hoffman started his career as a warehouse employee, when the company was owned by Continental Scale. Throughout his 43-year career, he was promoted mul-tiple times, traveled worldwide for overseas operations, and forged many longstanding

friendships. Hoffman’s retirement as Vice President of Opera-tions was celebrated at the company’s holiday party on Jan. 4, 2014. Following a slideshow highlighting Mr. Hoffman’s career achievements, he was presented with a crystal service award and an antique Health o meter Professional scale.

Medline acquires Professional Hospital Supply (PHS)Medline Industries Inc (Mundelein, Ill.) acquired Professional Hospital Supply (PHS) (Temecula, Calif.) and all of its related facilities. PHS, a distributor of medical and surgical supplies including sterile procedure trays, will continue to operate in

Temecula, California under the PHS name as a Medline sub-sidiary. “PHS is a successful business with talented employees which, like us, is family owned, privately held, and shares a passion for customer satisfaction,” said Charlie Mills, CEO of Medline. “Combining Medline’s strong and growing portfolio of products and distribution network with PHS’ superior customer relationships allows us to establish a new industry benchmark for superior quality, service, and value.” The combined com-panies will now have more than 12,000 employees worldwide, 1,200 sales representatives, 40 distribution centers, 19 manu-facturing facilities, and 350,000 medical and surgical products. Financial terms of the agreement were not disclosed.

Med World Live announces partnership with MDSIMDSI (Lawrenceville, Ga.), parent company of Repertoire, formed a partnership with Med World Live (Charlotte, N.C.). Med World Live offers video technology using multi-camera views, which reduces travel and overall training costs for medical device companies. MDSI customers now have the ability to pro-vide customized videos of their in-service protocols or product demos to the end users. The interactive videos, combined with the MDSI customized training curriculum, creates an all-in-one virtual learning experience that is new to the industry.

Sempermed introduces new and improved GripStrong® Nitrile Gloves Sempermed USA announced the introduction of a new and improve GripStrong® Nitrile glove. GripStrong® Nitrile gloves have been redesigned to provide additional durability and even more protection in an array of environments. GripStrong® Nitrile by Sempermed is now manufactured with state-of-the-

art technology offering a perfect balance of comfort and peace of mind. Addition-ally, the glove’s surface and textured fingertips allow the glove wearer to have com-plete control with improved tactile sensitivity. GripStrong® Nitrile by Sempermed will continue to be supplied in sizes small through extra-

large with one hundred gloves per box for all sizes. And to further eliminate any hassle within the distribution channel, GripStrong Nitrile reorder numbers will go unchanged; the product reorder numbers are GSNF102 (size small), GSNF103 (size medium), GSNF104 (size large), and GSNF105 (size x-large). Additionally, the dispenser boxes will remain color code by size; green (size small), red (size medium), blue (size large) and gray (size x-large). Sempermed encourages an open dialogue with Territory Managers. If you have any questions or concerns, contact a Sempermed representative at (800) 366-9545 or email, [email protected]. Visit www.SempermedUSA.com for more information.

Midmark launches “More” Power Procedures Table promotionMidmark Corp launched its “More” power procedures table promotion. The promotion order period is Feb. 3, 2014 – May 30, 2014. The last date to take shipment of products is June 30, 2014, and invoices must be dated Feb. 3, 2014 – June 30, 2014. The last date to claim incentives is July 31, 2014. The following incentives are available for each eligible product purchase during the promotion:

• Purchase a Midmark 630 HUMANFORM™ Procedures Table and receive one of the following offers:

• Articulating armboard and choice of any two headrests for the 630• Articulating knee crutches and choice of any two headrests for the 630• Midmark IQvitals Touchscreen with Blood Pressure, Alaris

Turbo Temp Thermometer and SpO2• $1,000 rebate

Purchase a Midmark 641 Procedures Table and receive one of the following offers:

• Articulating armboard and choice of any two headrests for the 641

• Chair arms and choice of any two headrests for the 641• Midmark IQvitals Touchscreen with Blood Pressure, Alaris

Turbo Temp Thermometer and SpO2• $1,000 rebate

Purchase a Midmark 647 or Midmark 646 Procedures Table and receive one of the following offers:

• Ritter 276 Air Lift Stool and Vision Block Screen• $400 (647) or $300 (646) rebate• Purchase a Ritter 230 Procedures Table and receive a $400 rebate• Purchase a Ritter 244 Procedures Tables and receive a $300 rebate

Bob Hoffman

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No Need to ReINVeNt tHe WHeeL

For 20 years MdSI has been helping manufacturers move market share.

Micah Mcglinchey770-263-5268 • e-mail: [email protected]


Are you LinkedIn?Join Repertoire’s LinkedIn page for the latest news,

commentary and industry networking.

Search “Repertoire – by MDSI” in the LinkedIn group pages.

$128 QuestionRepertoire’s $128 Question for each month is available on

our Facebook page, Twitter, and Blog.RepertoireMag.com. In January we asked:

What event did newspaper owner Adolph Ochs organize in 1907 that we still celebrate today?Answer: The New Years’ Eve Times Square Ball Drop

CongrAtulAtIons to Ben sAur, uMF MedICAl

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When you need a table that does more, where will you look?Improve efficiency, reduce costs and deliver better outcomes with a precise combination of technology and design, starting with the right table for the types of procedures you perform. Midmark can help.

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Visit welchallyn.com/pointsofcare for full promotion details.

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When your customers purchase select Welch Allyn devices, they’ll earn points redeemable for FREE Welch Allyn products, rebates or service agreements. Or, if they choose, Welch Allyn will donate their rebate to Heart to Heart International—a non-profit organization committed to connecting people and medical resources to a world in need.

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