Quick Answer: Order management in healthcare tracks medical equipment from prescription to payment. It includes insurance verification, prior authorization, delivery coordination, and billing. Valere’s Order Management solution offers centralized tracking, automated eligibility checks, and claim-ready processing to reduce errors and accelerate reimbursement.
Key Takeaways:
- Order management streamlines the entire process from prescription to payment for medical equipment providers.
- Automated systems cut processing time by 50-70% and reduce claim denials by 25-30%.
- Integration between intake, insurance verification, inventory, and billing creates a seamless workflow that improves cash flow.
Understanding Order Management in Healthcare for HME/DME Providers
What Is Order Management and Why It’s Critical for Post-Acute Care
Order management in healthcare is simply the process of handling medical equipment and supply orders from start to finish. For home medical equipment (HME) and durable medical equipment (DME) providers, it covers everything from when a doctor writes a prescription to when a patient receives their equipment and the provider gets paid.
Think of order management as the backbone of your HME/DME business. When a patient leaves the hospital needing oxygen equipment, a wheelchair, or CPAP machine, your ability to deliver that equipment quickly and correctly directly affects their recovery. Unlike retail businesses, HME/DME providers face unique challenges like getting prior authorizations from insurance companies, collecting detailed medical documentation, and managing ongoing supply deliveries for chronic conditions.
The stakes are high in post-acute care. A delayed oxygen concentrator delivery isn’t just an inconvenience—it could send a patient back to the hospital. Similarly, missing documentation for a power wheelchair doesn’t just mean a delayed order—it could mean complete claim denial and lost revenue for your business.
The Complete Order-to-Cash Lifecycle for HME/DME Businesses
The journey from receiving an order to collecting payment involves several critical steps. It starts when you receive a referral from a doctor or hospital. Your team then verifies the patient’s insurance coverage and benefits. This step alone can take hours of phone calls or portal logins.
Next comes the often-dreaded prior authorization process, where you must prove to the insurance company that the equipment is medically necessary. This requires gathering clinical documentation, checking coverage criteria, and submitting everything correctly.
Once approved, you schedule delivery, prepare the equipment, train the patient on its use, and obtain proof of delivery. Then the billing cycle begins—submitting claims, following up on unpaid claims, posting payments, and handling any denials.
Each step must flow smoothly into the next. A bottleneck anywhere—like missing physician signatures or incomplete documentation—can delay the entire process by days or weeks. For HME/DME providers operating on thin margins, these delays directly impact cash flow and growth potential.
Common Pain Points in Traditional Order Management Processes
Most HME/DME providers struggle with similar challenges in their order management workflows. Manual data entry across multiple systems leads to errors and wasted time. Staff often spend hours on the phone with insurance companies checking eligibility or authorization status. Paper-based documentation gets lost or filed incorrectly.
The lack of visibility across departments creates frustrating situations. The billing team doesn’t know why the intake team is missing documentation. The delivery team isn’t updated when authorizations are delayed. The sales team promises delivery dates that operations can’t meet.
These inefficiencies have real costs. The average HME provider spends 13-15 minutes processing each order manually. With denial rates averaging 15-20% for many providers, staff spend countless hours reworking claims. Meanwhile, the typical days sales outstanding (DSO) stretches to 45-60 days, creating cash flow challenges.
How Automated Order Management Impacts Your Bottom Line
Modernizing your order management approach can transform your financial performance. Automated order management systems can reduce processing time by 50-70%, allowing the same staff to handle more orders. By catching documentation gaps early, these systems can lower denial rates by 25-30%.
The financial benefits add up quickly. Consider a mid-sized HME provider processing 500 orders monthly. Reducing processing time by just 5 minutes per order saves 42 hours of staff time each month. Decreasing denial rates by 10% could mean thousands of dollars in previously lost revenue now flowing to your bottom line.
Beyond the numbers, automated order management creates a better experience for everyone involved. Patients receive their equipment faster. Referral sources appreciate your efficiency. Staff spend less time on paperwork and more time on patient care.
With Valere’s Order Management solution, HME/DME providers can transform their operations with centralized order tracking, automated eligibility checks, and claim-ready order flow that reduces errors and speeds up the entire process.
AI-powered automation tools like those offered through Valere’s Workflow Automation can handle routine tasks like insurance verification, documentation checks, and authorization submissions—freeing your team to focus on exceptions and patient care.
Key Components of an Effective HME/DME Order Management System
Streamlining Order Intake: From Referrals to Documentation
The journey of every medical equipment order begins with intake – capturing all the necessary patient details, doctor’s orders, and insurance information. For HME/DME providers, this first step often determines how smoothly the entire process will run.
Modern order intake solutions can transform this traditionally paper-heavy process. Instead of staff manually typing information from faxed prescriptions or referral forms, technology now exists that can “read” these documents automatically. This technology, called Optical Character Recognition (OCR), works like a super-powered scanner that not only sees the document but understands what’s on it.
These systems can pull patient names, addresses, diagnosis codes, and prescribed equipment details without human typing. The best part? They get smarter over time. Using machine learning, these systems improve their accuracy with each document they process.
For HME/DME providers working with multiple hospitals and doctor’s offices, modern intake systems can connect directly to their electronic health records through interoperability standards. This direct connection means orders flow straight from the doctor’s computer to yours without any paper changing hands.
The result is faster processing, fewer errors from manual data entry, and less time spent chasing missing information. What used to take hours now takes minutes, letting your team focus on helping patients rather than pushing paper.
Prior Authorization and Insurance Verification Automation
Getting equipment approved by insurance companies is often the biggest bottleneck in the order process. Modern order management systems tackle this challenge head-on with automated verification tools.
These systems can check a patient’s insurance coverage in seconds rather than the 15-30 minutes it might take a staff member on the phone. They connect directly to insurance company databases to verify benefits, check deductible status, and confirm coverage for specific equipment.
For items requiring prior authorization, AI-driven workflows can predict what documentation each insurance company will need based on the equipment ordered and the patient’s diagnosis. The system then automatically gathers this information from your records and submits it to the payer.
While the authorization is processing, the system tracks its status and stores all approval documentation. If there’s a problem or more information is needed, staff receive alerts to take action. This proactive approach means fewer surprises and faster approvals.
With Valere’s Workflow Automation, providers can automate these insurance verification processes and authorization workflows, dramatically reducing the time from order to approval.
Inventory Management and Order Fulfillment Integration
Once an order is approved, the focus shifts to getting the right equipment to the patient’s home. Effective order management systems connect directly with your inventory management to check if the ordered items are in stock.
This integration prevents the frustrating situation of promising equipment to a patient only to discover it’s not available. If stock is low, the system can automatically trigger reordering from suppliers to prevent shortages.
Smart systems also optimize delivery scheduling based on the patient’s location, equipment availability, and delivery staff routes. This route optimization means more deliveries per day with less driving time and fuel costs.
Mobile apps for delivery teams allow them to access order details, capture signatures, and document equipment setup all from their phones or tablets. These electronic delivery confirmations are instantly uploaded to the main system, completing the documentation chain needed for billing.
Billing, Claims Processing, and Revenue Cycle Optimization
The final piece of effective order management is turning completed orders into paid claims. Modern systems automatically generate insurance claims based on the documented order, delivery confirmation, and specific payer requirements.
Before submission, built-in claim scrubbing checks for common errors like missing modifiers, incorrect codes, or incomplete documentation. This pre-submission quality check dramatically reduces denial rates and speeds up payment.
The system matches each piece of required documentation to the claim, ensuring nothing is missing. This documentation matching process is crucial for HME/DME claims, which often require delivery tickets, detailed written orders, and proof of medical necessity.
Advanced reporting tools provide visibility into your entire revenue cycle, showing where orders get stuck, which insurance companies take longest to pay, and which products have the highest denial rates. These insights help you continuously improve your processes and focus staff attention where it’s most needed.
Valere’s Order Management solution brings these components together with centralized order tracking and claim-ready order flow that transforms the entire revenue cycle for HME/DME providers.
Implementing Modern Order Management Solutions
Evaluating Your Current Workflow and Identifying Improvement Opportunities
Before jumping into new technology, take a step back and look at how orders flow through your business today. Grab a whiteboard and map out each step from when an order arrives to when you get paid. This simple exercise often reveals surprising bottlenecks.
Walk through a typical order with your team. How many hands touch each order? How many systems does the information enter? Where do orders tend to get stuck? The answers will point to your biggest pain points.
Pay special attention to handoff points between departments. These transitions—from intake to verification, from delivery to billing—are where orders often stall. One HME provider discovered their verification team was waiting an average of two days for documentation that the intake team had already collected but stored in a different system.
Look at your denial reasons for the past few months. If you’re seeing patterns like “missing documentation” or “authorization expired,” these are clear signals of process gaps that need fixing. One medium-sized DME company found that 40% of their denials stemmed from documentation collected at delivery but not properly attached to claims.
Time your processes too. How long does each step take? Many providers are shocked to learn they spend 45-60 minutes processing a single oxygen order that could be handled in under 15 minutes with better workflows.
Choosing the Right Technology: Integration vs. Replacement Approaches
You don’t always need to throw out your entire system to improve order management. Many HME/DME providers get excellent results by adding targeted solutions that work with their existing billing or ERP systems.
Integration platforms like Valere’s Business Interoperability can connect your current systems without the disruption of a complete replacement. This approach typically costs less upfront and causes minimal disruption to your daily operations.
Cloud-based solutions offer significant advantages for most providers. They require less IT support, update automatically, and allow your team to access information from anywhere—crucial for staff who work remotely or in the field. They also tend to offer more flexible pricing models that grow with your business.
When evaluating vendors, don’t just listen to sales pitches about “seamless integration.” Ask for specific examples of how they’ve connected with systems like yours. Request references from customers using the same billing system you use. A good vendor will be honest about integration challenges and have proven solutions.
Remember that workflow automation matters more than fancy features. A simple system that truly streamlines your daily processes will deliver more value than a complex one with bells and whistles your team won’t use.
Measuring Success: KPIs That Matter for HME/DME Providers
To know if your new order management approach is working, you need to track the right numbers. Start by measuring your current performance on these key metrics:
Order processing time measures how long it takes from receiving an order to delivering equipment. Top-performing HME companies process routine orders in 1-2 days rather than the industry average of 5-7 days.
Documentation completion rate tracks the percentage of orders with all required documentation on the first submission. Leading providers achieve rates above 95%, dramatically reducing follow-up work.
Clean claim rate shows what percentage of your claims are paid on first submission without rejection or denial. The industry average hovers around 75-80%, but best-in-class providers exceed 95%.
Days sales outstanding (DSO) measures how long it takes to get paid after billing. Every day you reduce your DSO puts cash back into your business faster.
Set realistic improvement targets based on your starting point. A 10-15% improvement in the first six months is typically achievable and meaningful.
Best Practices for Training Staff and Managing the Transition
New systems only work when people use them correctly. Start by involving your team early in the process. The people doing the work every day often have the best insights into what will and won’t work.
Create a core team of super-users who receive extra training and can support their colleagues. These champions become your front-line problem solvers and enthusiasm builders.
Train in small, focused sessions rather than day-long marathons. People retain information better in shorter bursts, especially when they can immediately practice what they’ve learned.
Use real orders in training whenever possible. Abstract concepts don’t stick as well as seeing how the system handles the exact orders your team processes every day.
Expect and plan for a temporary dip in productivity during the transition. Schedule go-live during a typically slower period if possible, and consider adding temporary help for the first few weeks.
Celebrate early wins to build momentum. When the team sees the new system saving time or preventing denials, their buy-in will grow naturally.
SOURCES:
- TechTarget: “What is order management?”: https://www.techtarget.com/searcherp/definition/order-management
- IBM: “What is Order Management?”: https://www.ibm.com/think/topics/order-management
- Oracle: “What Is Order Management”: https://www.oracle.com/scm/order-management/what-is-order-management/