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Medical Transactions: Your Prescription for a Bigger Payday

By Lisa Shipley

All right, so you're feeling a little sick because you've beaten down the door of every retailer on the planet, and now you're In Search Of the next big opportunity to grow your portfolio. Well my friends, please take a seat in the waiting room; the doctor will be with you shortly-with a prescription for your next big success.

Can you say "healthcare?" ISOs and MLSs, this is the big kahuna; it's the one you've been waiting for. This is the potential tsunami of business opportunity, and I'm here to give you the game plan-or should I say prescription?

At the heart of it all are federal privacy laws administered under the umbrella of the Health Insurance Portability and Accountability Act (HIPAA). In simple terms, HIPAA requires physicians, hospitals and the whole body of healthcare providers to handle claims and eligibility electronically.

And guess what? PC's are NOT the answer. They are too slow, and they're not built for these types of applications. Instead, card terminal technology is the answer-that is, if you're selling the big memory units with the fast (56K) modems.

Right now, this opportunity is staring you in the face. In fact, the dates below will open your eyes to how big and timely this revenue stream-an ocean of opportunity-really is for ISOs and MLSs.

According to the U.S. Department of Health & Human Services' Web site ( hipaa2/deadlines.asp), most healthcare providers and health plans should have been HIPAA compliant by April 14, 2004 and everyone must be fully compliant by Aug. 1, 2005. Pretty exciting isn't it?

Here's some insight on how big this market is and how many locations are potential candidates for you to pursue: Though a precise number of total hospitals in the United States is hard to come by, it's in the tens of thousands.

One source conducted a survey of 26,000 hospitals (for profit) handling 38 million patients. That equates to 114 million potential transactions for you, considering the government via HIPAA is requiring that enrollment, billing and eligibility verification are to be done electronically. And let's not forget "old faithful"-the payment transactions.

By the way, we might look at hospitals as multi-lanes because of their size. You might think these hospitals have great computers and therefore don't need terminal technology-but this is not true.

As I said before, terminal technology (with fast modems and a lot of memory) accommodates these transactions, while regular computers do not.

Next, let's do a count of physicians-who typically have offices that now need to do HIPAA-required electronic transactions-and the population of this country. Keep in mind these offices are a target market for you when you pursue healthcare business.

As of April 2004, the Census Bureau cites the U.S. population at 292,990,663. Other research I conducted found that the average number of physicians per capita is 286 per 100,000 which means there are nearly 3 million physicians in the United States who, according to other data I found, are handling 880.5 million patient visits annually (as of 2001).

Again, looking at HIPAA requirements, each patient potentially adds up to three healthcare transactions: enrollment, billing and eligibility verification (I didn't include payment transactions as these are likely already happening.).

Using simple math, that means you're looking at upwards of 2.6 billion transactions in a market segment with almost no terminals in place to do these HIPAA-required electronic transactions.

I could go on with the Mount Everest-sized number of healthcare locations and transactions that are going to need the right kind of terminal technology-from you or your competitors. But, in addition to those numbers, there are clinics, labs, physical therapy centers, etc. that must also deliver HIPAA's transaction requirements.

If you can't see the size of this opportunity by now, then may I suggest a quick visit to the eye doctor-who, by the way, will need to do your enrollment, eligibility and billing electronically using a big memory card terminal with a really fast modem.

So, are you ready to go after this biggie? Here's some guidance to get you going. In my view, you should immediately take this edition of The Green Sheet and head straight to your nearest processor; ask your processor with whom they have partnered to provide not only medical transactions, but also credit card transactions.

There are companies such as MedCom that have zeroed in on this really big arena of opportunities-and they need YOU to help make it happen at the "point of privacy" (doctors offices, hospitals, health plans, labs, etc.) They are all over this as a leading processor of HIPAA transactions. Their niche related to HIPAA is provided here verbatim from MedCom:

"...The MedCom System can take care of all the transactions a medical office will need: checking a patient's insurance eligibility, co-pay information, patient self-pay receivable management, claims processing, pre-authorizing treatment and patient referrals all from one terminal..."

If you're already on the way to your car to get started on this great opportunity, wait a few more seconds. You will fail in this business segment unless you have terminal technology with a large memory capacity and a seamless multi-application operational capability equipped with a really fast modem.

These terminal characteristics are not optional because of the size and complexity of the non-payment transactions that HIPAA says must be done electronically.

This shouldn't be a hard sell; actually, it should be relatively easy. It's all about return on investment (ROI). There are ROI calculators on the Internet that can show you that the return on this investment is significant (if you can't find them e-mail me, and I'll lead you to the information).

These ROI data can be easily presented to the office manager or the decision maker at virtually any medical facility. When you have the economics on your side, along with government regulations that require capabilities such as big memory and a fast modem, you should be making many more trips to the bank to make big deposits thanks to your new revenues from this market segment.

Finally, if you are truly in search of building the biggest, most valuable portfolio so you can cash out big one day soon, then add healthcare HIPAA transactions right away.

I can tell you from my direct experience that I'm already seeing terminal orders in big numbers coming from those who have caught on to this business segment.

To me this is a profit monster that's really just waiting for you to grab it. Now, I've given you the prescription, so go fill it!

Lisa Shipley is Senior Vice President, Hypercom Corp. You can reach her at .

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