Current Situation
Company ABC in the Durable Medical Equipment (DME) industry is current facing a decrease insales and profitability. The situation is focused around recent and governmental proposed regulationssurrounding Medicare reimbursement rates on reimbursable products, which offers less of a reimbursement payment to our current customers and requires bidding contracts on the business segment, defined as Group 2 products within the industry (Mobility Management, 2015). The symptoms of the problem include past fraudulent activity carried out by the Scooter Store and other companies within the industry, which has resulted in changes within the organization to help meet the needs of our current customers (Washington Post, 2014). The scam conducted by the scooter store has led to billions of dollars in payments being paid out by the government for fraudulent claims. The second symptom is that new regulations have resulted in less of our customers order power chairs through patient prescriptions in fear of being audited or not being reimbursed by the government for the product provided to the customer.
Problem Statement
It is unknown if the reduced Medicare funding and new regulations is resulting in a decrease of sales and profitability for company ABC.
Research Objective
The research objective would be to generate quantitative data by identifying customer accounts that are currently down in sales after the new regulations have went into place and to determine what if any price reductions were giving to the account to help cope with the new mandates. Furthermore, the gathering of qualitative data on the down accounts determined above in regards to how the newregulations have impacted each identified account. Through the use of this research information a hypothesis can be formulated and tested to help provide insight to the actual reason why company ABC is experiencing declining sales and profits. Thus, the research objective would be to determine what has caused the decline in sales and profitability at Company ABC?
Research Questions
The following research questions will need to be addressed.
What accounts are currently down after the new regulations were passed?
Were any price reductions given to these accounts?
How did the new regulations impact these accounts?