This month's headlines
 

On the brink of change. The first salvos of the debate about healthcare reform have already been sounded. How will you, your customers and your manufacturers be affected by it? How about you as a consumer of healthcare…and your family? How long before the pieces really fall into place? And how should you as a business owner, a consumer and a player in this country's healthcare system respond? Come to the Annual Conference for answers. Will you sponsor a new member? Remember when you joined IMDA? If you already knew somebody in the organization, you were in luck. But if you came in cold -- that is, without knowing anyone -- you might not have been able to maximize your membership, at least for awhile. IMDA is addressing that with a newly announced mentoring program for new members. Hot button! The photo of Adolf Hitler should have been a tip-off that this is one hot issue. What's causing all the fuss? Hospitals welcome stimulus package. The short-term prognosis for hospitals is bleak. Patient visits have dropped, so have margins. But the long-term outlook isn't so bad. Let the sun shine! Many payments made to doctors by manufacturers of medical devices, drugs or biologicals would become public knowledge, if legislation introduced in January becomes law. Excluded would be payments or transfers of value that total less than $100 over a calendar year. You want the sale? You gotta ask for it! Why is it that salespeople invest so much time, energy, preparation, and effort on the phone with prospective and existing customers during the sales cycle, only to let the sale fade away or go to the competition?

2009 IMDA Annual Conference June 14-16, 2009 Francis Marion Hotel Charleston, SC

Annual Conference On the brink of change

The first salvos of the debate about healthcare reform have already been sounded. How will you, your customers and your manufacturers be affected by it? How about you as a consumer of healthcare…and your family? How long before the pieces really fall into place? And how should you as a business owner, a consumer and a player in this country's healthcare system respond?

Nobody knows the answers for sure. But some of us spend more time than others studying the landscape and making reasonable guesses about the future. Joe Flower is one of them. And that's why he has been asked to give the keynote address at the upcoming IMDA Annual Conference and Manufacturers Forum, June 14 to June 16, in Charleston, S.C. The title of his presentation is "Selling Into a Value-Based Healthcare System: Three Hard Steps."

As a healthcare speaker, writer, and consultant, Flower has explored the future of healthcare with clients ranging from the World Health Organization, the Global Business Network, and the National Health Service of the United Kingdom. He has worked with the majority of state hospital associations in the United States as well as many provincial associations and ministries in Canada. His clients include professional associations, pharmaceutical companies, device manufacturers, health plans, physician groups, and numerous hospitals. He has been a consultant on change and the future with the U.S. Department of Defense, Airbus and ArianeSpace, and a number of governments in China.

For more than 20 years, Flower was a contributing editor and regular columnist at the Healthcare Forum Journal. For 12 years he has written a regular column for Physician Executive, the Journal of the American College of Physician Executives. He is the author, as well, of a number of pivotal articles on the Healthy Cities/Healthy Communities movement.

Flower was a contributing writer for Wired Magazine in its early years, and a columnist for the pioneering health websites DNA.com and HealthCentral.com. He was a founding member of the International Health Futures Network and the principal author of the landmark healthcare forecast, "Technological Advances and the Next 50 Years of Cardiology," which was published in the Journal of the American College of Cardiology (vol. 35, no. 4, 2000).

Flower is opinionated and guaranteed to challenge you. So come prepared for vigorous debate and insight. Check out his website at www.imaginewhatif.com for videos and articles from Joe Flower.

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Remember when you joined IMDA? If you already knew somebody in the organization, you were in luck. You had someone to call if you had questions, you knew how to tap into the network of knowledge that membership offers. But if you came in cold -- that is, without knowing anyone -- you might not have been able to maximize your membership, at least for awhile. Going to the Annual Conference helped, for sure. But after that, you might have felt a little "out of it."

IMDA Announcement Refer a member and get $50 Every time IMDA gains a member, our collective voice grows louder, our collective wisdom becomes greater, and our collective influence in the market grows. It's good for everyone. And there's no better source for new members than current ones. After all, you know the market, you know the people. That's why IMDA is offering members $50 for every new member who joins as a result of your referral. So when you're walking the floor at your next trade show, or taking a break at your next sales meeting, keep an eye out for companies that might benefit by joining IMDA. Collect business cards and send them to headquarters. Fifty bucks is nice. But the added wisdom, knowledge and camaraderie that a new member brings are even greater payoffs.

IMDA is addressing that with a newly announced mentoring program for new members. It's an idea that was advanced by members of the board, and IMDA members' services are wanted.

"We want to offer new members an opportunity to learn how to maximize the value of IMDA membership, and to offer them a reliable person they can call on to discuss their day-to-day challenges or issues," says IMDA President Shawn Walker of Bay State Anesthesia. Adds former IMDA president Duke Johns, "The sponsor is someone whom a new member can go to in order to get their questions answered and their answers questioned."

By establishing personal ties with current members, the new person will feel welcome, and the interpersonal fabric of the association will be strengthened, says Walker. The more quickly a new member can get involved, the more quickly he or she can maximize the benefits of membership and become an active, contributing member of IMDA. The program is strictly voluntary for new members, who will be asked as part of their application if they would like a sponsor.

IMDA is seeking current members to act as sponsors, preferably in the same specialty(ies) but different geographic region as the new member. The duty is pretty light, says Walker. The sponsor takes it upon himself or herself to ensure regular contact with the new member, perhaps on a monthly basis, for the first year of that person's membership in IMDA. In addition, the sponsor agrees to take the new members' calls as needed.

"Acting as a sponsor will enrich your experience as an IMDA member," promises Walker.

Members who are interested in serving as a sponsor should contact Executive Director Katie Swartz by e-mail or (866) IMDA-YES (866-463-2937).

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The photo of Adolf Hitler should have been a tip-off that this is one hot issue. That Hitler's photo was attached to a commentary about healthcare is a little surprising. That the photo and commentary appeared in the Washington Times, perhaps, is not.

In its February 11 editorial, "Health 'efficiency' can be deadly," the newspaper compared one provision of the recently signed economic stimulus plan to a program in Hitler's Germany called Aktion T-4. "Under this program," wrote the paper, "elderly people with incurable diseases, young children who were critically disabled, and others who were deemed non-productive, were euthanized. This was the Nazi version of efficiency, a pitiless expulsion of the 'unproductive' members of society in the most expeditious way possible."

Rush Limbaugh and Betsy McCaughey, adjunct senior at the Hudson Institute, voiced their strong disapproval of the comparative-effectiveness provision as well, though not in as graphic a way as the Washington newspaper. Writing in Bloomberg.com, McCaughey called the provision "hazardous to your health." Limbaugh said that, essentially, it's the government's way of telling seniors "Get out of the way and die." (His words.)

The provision of the stimulus plan that aroused such ire allocates $1.1 billion to "comparative effectiveness" research. Under the provision, a so-called Federal Coordinating Council for Comparative Effectiveness Research has been charged with "accelerat[ing] the development and dissemination of research assessing the comparative effectiveness of health care treatments and strategies." The council is also charged with "encouraging the development and use of clinical registries, clinical data networks, and other forms of electronic health data that can be used to generate or obtain outcomes data."

IMDA Announcement Looking for lines? View a list of all medical devices receiving FDA marketing clearance in January by visiting the FDA Website. You might find a company in need of your expertise.

Detractors -- including McCaughey -- fear a slippery slope, namely, that the Comparative Effectiveness Council (in conjunction with the Office of the National Coordinator for Health Information Technology) will literally monitor what your doctor is doing and intervene if his or her recommended treatment fails to follow guidelines that the feds deem appropriate and cost-effective. Supporters say that's hogwash. They maintain that the provisions of the stimulus will protect patient privacy, and that comparative effectiveness research is necessary to help contain healthcare costs.

The provision does not specifically talk about judging the cost-effectiveness of procedures. But it's not out of the realm of possibility. Indeed, even though President Obama's first HHS Secretary nominee, Tom Daschle, has been eliminated from the running, it's possible -- even likely -- that some of his ideas could influence the Obama Administration's future direction in healthcare policy.

One of those ideas was proposed by Daschle in his 2008 book Critical: What We Can Do About the Health-Care Crisis. In it, Daschle recommends formation of what he calls the Federal Health Board. Modeled after the Federal Reserve Board, the health board would be the Congressionally sanctioned "bad guy" making key healthcare decisions. It would decide which drugs, devices and medical treatments would be covered by government payers. Presumably, such decisions would be made by considering not only the effectiveness of various treatments, but their cost-effectiveness as well. Private payers would most likely follow their lead. Such a model exists in other countries, such as Great Britain's National Institute for Health and Clinical Excellence.

Some were offended by the tone taken by the Washington Times. "We are confident that the American people will see through this fear-mongering propaganda," wrote Bill Novelli, CEO of the AARP, and John Tooker, M.D., executive vice president and CEO of the American College of Physicians, in a Feb. 18 "Letter to the Editor" to the Washington Times. "Comparative effectiveness…has existed for decades and has widespread support from doctors and consumers," they wrote, adding, "Health information technology is important because it gives health providers and patients real-time information that can reduce errors, save time and improve care."

It's likely that the divisiveness over this comparative-effectiveness provision of the economic stimulus bill presages even more heated debate over the larger issue of healthcare reform.

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The short-term prognosis for hospitals is bleak. As reported in the November/December 2008 IMDA Update, many hospitals are experiencing a decline in the number of patients seeking elective procedures, and a significant percentage are reporting a drop in overall admissions. What's more, margins took a significant tumble last year, and many hospitals are delaying renovations and capital equipment purchases. But the long-term outlook doesn't look so bad.

IMDA Announcement Door Opener If your reps call on the OR, you know the drill: They have to demonstrate their knowledge of OR protocol, HIPAA, bloodborne-pathogen regulations and more. Today, with vendor credentialing in the mix, the barriers to entry into the OR are higher than ever. Help your reps pass through those barriers by enrolling them in online OR training courses from HealthStream. As an IMDA member, you'll receive a discount. Upon completing them, your reps will receive a wallet-sized card provided by AORN and HealthStream. That card is a door-opener. To learn more about the program, visit this URL today: www.healthstream.com/products/sts.htm.  To take advantage of the special IMDA discount, go to the "Members Only" portion of the IMDA Website (www.imda.org) and scroll to the box on "Surgical Environment Training."

A recent report from MDSI (publisher of Repertoire magazine), based on local news searches from around the country, painted a vivid portrait of hospitals' reactions to uncertain economic conditions:

• A total of 284 facilities reported more than 21,000 layoffs in 2008.

• The fourth quarter saw the most layoffs in 2008, more than twice of the next closest quarter (Q1).

• Reported layoffs occurred in 31 states.

• Texas, New York and New Jersey suffered the most layoffs of the hospitals and health systems who reported such numbers.

• The Northeast incurred 37 percent of the nation's reported layoffs.

• The most cited reason for layoffs was lower volume.

However, hospitals are expecting some relief from the recently signed American Recovery and Reinvestment Act, better known as the economic stimulus package. "This legislation provides immediate relief to help shore up our fragile health care system, and, at the same time, lays the foundation for more comprehensive efforts to make significant improvements and reforms to health care," said Richard Umbdenstock, president and CEO of the American Hospital Association, in a statement released Feb. 13.

"Provisions existing in these bills contain key items that are important to the patients and communities served by the nation's hospitals, ranging from ensuring the availability of health care coverage for the unemployed and providing increased support for the Medicaid program, to making a down-payment on investments to improve the quality and efficiency of care through health information technology; investing in the training of more health care professionals, and blocking several Medicare and Medicaid regulations proposed by the previous Administration that would have created barriers to serving our most vulnerable patient populations."

Longer term, healthcare spending is projected to increase 6.2 percent per year through 2018, exceeding the growth in gross domestic product, according to a study published in Health Affairs. As a result, the health share of GDP is expected to rise from 16.2 percent in 2007 to 20.3 percent in 2018.

Total hospital spending is projected to grow 7.2 percent in 2008, or 0.1 percentage points slower than in 2007, and to reach $746.5 billion, according to the report. In 2009, hospital spending growth is projected to further decelerate to 5.7 percent, largely due to an expected deceleration in private-payer hospital spending growth. Beginning in 2011, however, growth in hospital spending is projected to accelerate, reaching 7.0 percent by 2018. Private payer hospital spending growth is expected to climb to 6.4 percent by 2018 in response to the expected economic recovery, while public-payer hospital spending growth will accelerate more rapidly, as the oldest baby boomers become Medicare-eligible.

To view the Health Affairs report, to go http://content.healthaffairs.org/cgi/content/full/hlthaff.28.2.w346/DC1.

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Many payments made to doctors by manufacturers of medical devices, drugs or biologicals would become public knowledge, if legislation introduced in January becomes law. Excluded would be payments or transfers of value that total less than $100 over a calendar year.

On Jan. 22, Senator Charles Grassley (R-Iowa) re-introduced his Physician Payments Sunshine Act, along with co-sponsors Amy Klobuchar (D-Minn.) and Herb Kohl (D-Wisc.). Introduced in the Senate as S. 301, the bill is similar to a bill introduced last year by Grassley to the 110th Congress, which was never acted on.

Beginning in 2011, manufacturers would be required to electronically submit on an annual basis all information on payments or other “transfers of value” to physicians. Payment could assume a number of forms, including cash; in-kind items or services; or stock, stock options, dividends, profits or ownership interest. The nature of payments covered include consulting fees or other compensation for services, honoraria, gifts, entertainment, food, travel, education, research, charitable contributions, royalties or licenses, compensation for serving as faculty or as a speaker for a continuing medical education program, and grants.

In the case of physician ownership of vendors, the vendor will be required to electronically submit to the government the dollar amount invested by each physician, the value and terms of ownership or investment interest, and any other payment or transfer of value.

The legislation calls for the federal government to establish, no later than Sept. 30, 2011, an electronic, searchable, online database of such information “in a format that is clear and understandable.” Information would be updated on an annual basis thereafter.

The law would preempt any state law or regulation that requires manufacturers to disclose information similar to that called for by the Sunshine Act. And for that reason, the proposed federal legislation won at least the tentative support of the Advanced Medical Technology Association (AdvaMed), the Washington, DC-based association for medical products manufacturers.

"We are currently reviewing the details of this newly re-introduced legislation, but believe it is important that any federal disclosure legislation create a uniform national standard to prevent a patchwork approach by all 50 states," said AdvaMed President Stephen J. Ubl in a statement released one week after Grassley introduced his bill.

Still, Ubl was careful to hedge his bets. "Physicians play a critical role in the continued innovation and advancement of medical technology, and federal disclosure legislation should be written in a way that allows for our unique research and development process to thrive while providing meaningful information regarding payments to physicians in an appropriate context."

Text of the legislation can be found at http://thomas.loc.gov/cgi-bin/query/z?c111:S.301:.

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Part 1 You want the sale! You gotta ask for it! Help your reps get to the 'selling end zone' by sharpening their skills By Gerry Layo

Editor's Note: This month, Gerry Layo looks at reasons why some sales reps may come close to a sale, then back off at the last minute. Next month, he'll offer some suggestions as to how reps can bring it into the end zone.

Here is an interesting question: Why is it that salespeople invest so much time, energy, preparation, and effort on the phone with prospective and existing customers during the sales cycle, only to let the sale fade away or go to the competition? Why is it that reps place so much emphasis and commitment on the process of moving the ball down the field, yet design very few plays to actually take the ball into the end zone?

Salespeople need to realize that whenever they fail to create some closure--ask for the business--they literally destroy (or at least taint) all that they have worked for throughout the sales process. They give up the connection and trust that they have built, the relationships that they have developed, the enthusiasm they have created, as well as the momentum of the process. They simply let the sale wither away and die, or get taken over by another more assertive, focused salesperson who was prepared and who took the leap of faith to ASK for the business!

Do your reps feel that they offer such irrefutable evidence of value throughout their sales presentations that the customers will simply give in? Do they feel that their features, advantages, and benefits (FAB points) are so compelling that prospects don't need to be asked to buy them? Do they feel that they will offend their prospects if they were to actually ask them to buy the product or service? If the answer to any of these questions is yes, then you need to help your reps GET OVER IT (or possibly consider another career)! Here are a few very key rules to pass on to your reps who are interested in closing a sale:

• Rule #1: You MUST ask for the business!

• Rule #2: You MUST earn the right to ask for the business!

• Rule #3: The customer knows why you're there. So build the case, then ASK for it!

• Rule #4: Sometimes the answer is NO! Deal with it!

• Rule #5: If you cannot, will not, or do not ask for the business…someone else will!

Ok, so why does it happen? Why do many salespeople hesitate to ask for the business? IT IS MY BELIEF THAT MOST SALESPEOPLE DO NOT ASK FOR 'YES' BECAUSE THEY ARE AFRAID TO HEAR THE 'NO.' Here are some other reasons:

• They have little to no belief in their value proposition, their product, or their service.

• They have a lack of confidence or self-worth.

• They have no connection with the customer, thus no trust.

• The customer is in control, asking all the questions.

• The salesperson doesn't feel like he or she has yet to earn the right.

• The salesperson has not discovered any motivators to create urgency.

• The rep has failed to discuss timelines throughout the process.

• The rep lacks a defined sales process, which he or she can follow.

The good news is that ALL of these are within the control of the salesperson---the right salesperson.

One final fact: It is not the responsibility of the customers to close themselves. That is the job of the salesperson! Reps are not paid to be professional educators, professional presenters, hesitant visitors or walking-talking brochures or website. They are paid to move the ball down the field and to score.

Watch next month's IMDA Update for ideas on how to help your reps do just that.

Gerry Layo is CEO of Sales Coach International, Granite Bay, Calif., which -- through speaking engagements, workshops and extended coaching/consulting engagements -- is dedicated to helping companies in the areas of sales, sales leadership and customer service. He conducted two IMDA training seminars in 2008. He may be reached at www.gerrylayo.com.

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IMDA Update Published by IMDA 5204 Fairmount Ave., Downers Grove, IL 60515 Phone:  (630) 655-9280 (866) IMDA-YES (866-463-2937) Fax: (630) 493-0798 Website:  www.imda.org E-mail:  imda@imda.org   Staff Katie Swartz: Executive Director Judy Keel: Executive Vice President Patti Perillo:  Senior Administrator Mary Moran:  Chief Financial Officer Mark Thill, Editor & Communications Director (847) 255-0716 Mitchell Kramer, Legal Counsel (800) 451-7466 Barbara Kramer, Legal Counsel (734) 930-5452 George Ayd, Jr., Insurance Administrator (703) 652-1309         2009-2010 Directors President Kevin Trout, Grandview Medical Resources, Inc. (412) 914-0950 President-Elect Anthony Marmo, Martab Medical (201) 512-1100 Secretary/Treasurer Hal Freehling, Jr., O.E. Meyer Company (419) 609-1633 Chairman of the Board Dave Campbell, PhD, Vital/Med Systems Corporation (303) 660-0888 Directors-at-Large Tom Birmingham, Bay State Anesthesia, Inc. (978) 682-6321 George Howe, Mercury Medical (727) 573-0088 Philip M. Reilly, KOL Bio-Medical Instruments, Inc. (703) 378-8600 Don Reiter, Specialty Respiratory Care, Inc. (818) 717-8807 x19 Bill Schultz, IPV Medical, LLC (760) 212-2769 Past-President Shawn Walker, Bay State Anesthesia, Inc. (978) 682-6321 Manufacturer Representative to Board Tim Beevers, Beevers Manufacturing & Supply (503) 472-9055 The ideas presented in this newsletter may or may not be applicable to your particular situation.  Always consult your tax advisor, attorney or CPA before putting them into effect.