The Federal Government has reduced expenditures in a move that negatively impacts DME productsLOS ANGELES, CA (DeciBio – April 1st, 2011) – Today, DeciBio published the second edition of its “Durable medical equipment (DME): U.S. market size, segments, growth and trends” report. DME is defined as instruments and products used for medical purposes and that can withstand repeated usage.This report segments the DME market in six therapeutic segments: Home respiratory therapy, Home infusions, Diabetes supplies, Patient positioning, Patient mobility, and Other equipment. Using this segmentation, DeciBio estimates the U.S. DME market reached ~$26B in 2010, and expect this market to grow 6% per year to reach $31B by 2013. Growth is expected to be driven in part by demographic trends, patient preference, cost benefits, hospital logistics, and gated by continued reimbursement pressure, nurse shortage and international imports. Growth is expected to slow down significantly in 2013, with the implementation of the Round 2 of Medicare DMEPOS competitive bidding program.This report provides an analysis of six key events expected to reshape the industry:

1. Round 2 of the Medicare DMEPOS competitive bidding program aimed at replacing the existing fee schedule amounts with more market-based prices.
2. Entry of large players in new therapeutic segments
3. Industry consolidation triggered by increased reimbursement pressure and Round 1 of DEMPOS competitive bidding.
4. Levers used by private payors, given their increased scrutiny in this industry, and to control costs
5. Value chain disintermediation.
6. Patient discharge and referral laws.

The DME market is highly fragmented, and counts more than 100,000 providers. Key providers includeApria, Lincare, Rotech, Praxair and American Homepatient. On the manufacturing side, main players include Invacare, Respironics, Sunrise Medical, Baxter, Lifescan, Hill-Rom, Gaymar and KCI.“In this report, we take a closer look at two specific segments: respiratory therapy and patient mobility” said Stephane Budel, a partner at DeciBio. “We took a deep dive in these two segments. In addition to additional market information and manufacturer and provider economics, we provide an analysis of the value chain, as well as distributions of equipment spend among manufacturer and provider.”

Authors: Stephane Budel, Partner at DeciBio, LLCConnect with Stephane Budel on Google+https://plus.google.com/+StephaneBudel