Asked about when he started in the family business, M. Kale Hinnant quips, “Birth.” It’s a bit of an exaggeration, but Hinnant is the third generation in a business that spans eight decades. With only 6,000 practitioners nationwide, it’s a unique business started by his grandfather W.T. Hinnant for unique reasons.
In 1930, W.T. Hinnant was struck by a train while pushing his car off the tracks and lost a leg. At the time, no companies in North Carolina manufactured artificial limbs so Hinnant’s grandfather obtained a prosthetic leg from a company based out of Minneapolis.
“Back then,” Hinnant explains the history, “someone would travel to you, take your measurements, go back and make the prosthesis, and then ship it to you. You were left to adjust or repair it. There was no such thing as patient care; my grandfather had to make his own revisions to his prosthetic appliance. Some of his revisions were even later utilized by the Minneapolis Artificial Limb Company on their products.”
It immediately became obvious to Hinnant’s grandfather that he had the ability to help other amputees in the Carolinas, so he apprenticed with the Minneapolis prosthetics maker and, after learning the craft, opened W.T. Hinnant Artificial Limb Company in Charlotte in 1931.
The company keeps the name today but is more commonly known by the signage on their building in Charlotte’s South End—Hinnant Prosthetics.
Specializing in lower and upper limbs and hands and servicing North and South Carolina, the company has fit over 28,000 prosthetics since its founding and is one of the longest established and most recognized prosthetic and orthotic companies in the Southeast.
Started as a one-man operation, W.T. Hinnant’s sons, John and Milton, joined the firm after their graduation from the University of North Carolina at Chapel Hill. Kale Hinnant, Milton’s son and the current owner and manager, now employs three certified technicians who assist with the manufacture of prostheses, two office staff, and two certified prosthetists who instruct the technicians and fit the appliances.
Much has changed since the company’s founding. Educational requirements and certification for practitioners elevated what used to be a craft to a profession.
“In the early days, if you could cut something off a tree and make it work, you were a prosthetist,” Hinnant explains, “Our firm was the first in Charlotte to be certified by the American Board for Certification.
“We believe in education for our employees and we work to further their education and advancement. In order to stay current with the rapid technological advances of this field, our practitioners regularly attend seminars and continuing education classes provided by the American Academy of Orthotists & Prosthetists (AAOP) and various product manufacturers.”
Hinnant sets the example. He holds a B.S. in Accounting, a B.A. in Business, and is one of only six Fellows of the American Academy of Orthotics and Prosthetists (FAAOP) in North Carolina and was among the first 50 recognized for this educational achievement nationwide.
A seasoned veteran in the business, Hinnant emphasizes how keeping up with advances in technology is critical now more than ever.
“New applications of space-age materials, digital technology, and experience with combat injuries from more than a decade of war in Afghanistan and Iraq have spurred a high tech explosion in prosthetic science.
“War is the greatest driver of innovation in prosthetics,” Hinnant says. “Caring for amputee casualties promotes federal funding for developing better technology.”
Hinnant easily ticks off a list of recent technological breakthroughs.
High-tech prosthetics like the C-Leg and the Ossur Rheo Knee use a microprocessor to adjust prosthetic leg swing for a more natural gait, greater freedom of movement and reduced walking fatigue.
Advances in myoelectric-controlled upper extremity prosthetics, which use electronic sensors to translate minute muscle, nerve and EMG activity into prosthetic movement, continue to improve function.
The i-LIMB Hand features five fingers each powered by separate motors which someday may allow the individual use of each finger.
Hinnant Prosthetics utilizies the Omega Tracer CAD. This technology replaces the traditional time-consuming plaster casting process and creates a highly accurate, three-dimensional picture of an amputee’s residual limb producing the best possible socket design for the patient’s needs, physiology and lifestyle.
With better technology comes higher costs, so prosthetic prices vary widely. Lower extremity appliances’ price tags can range from $5,000 to $100,000-plus. Upper extremity prosthetics can cost $3,000 to upwards of $120,000-plus.
“You have to put patients in the right appliance,” says Hinnant. “When you meet with a patient you ask them whether they want to ambulate, what they do, what are their activities. You also ask about their aspirational plans; what they want to be able to do.
“The more technology, the more difficult a prosthetic is to maintain, so it’s not always just the cost of the prosthetic, but also the cost factor over time. But if the patient’s capable and would benefit from a certain appliance, then you just have to educate them so they’re aware.
“This is a very personal, customized product. About 10 to 15 percent of our patients have the higher-end technology, but high-end is a relative term dependent upon their needs and wants. I can put a $30,000 foot on a leg but is it going to benefit that particular patient? That’s the question.”
It’s All About Patient Care
“From the beginning of this company, it’s always been about patient care,” affirms Hinnant. “We don’t only fit patients physically, we fit them mentally. You’re dealing with the emotional issues of losing a limb. It’s the same grief as dealing with death. You have to allow the patient to grieve and get through it.”
One reason Hinnant understands his patients so well is that he’s known many of them for years. Amputees need lifelong care in terms of prosthetic adjustments, maintenance, repairs, and over the course of time, new or upgraded appliances.
Craig Winslow lost his leg to cancer 28 years ago. Hinnant Prosthetics provided him his first appliance and went through the training with him needed to adapt. Since then, they’ve cared for him over his five subsequent prosthetics.
Currently Winslow uses two prosthetics. As a Boy Scout Master and active dad of three boys, he has a waterproof leg for water skiing and family trips to the beach. He also has an everyday leg which, as a Jimmy Buffet fan, he decorated with a sunset beach scene. A past leg sports the logo of Winslow’s alma mater Florida State.
“I just live an ordinary life,” says Winslow. “My prosthetic doesn’t hold me back; it’s allowed me to get on with my life. When I wake up I put it on and I don’t take it off till bed that night. It’s so comfortable there are times I forget that I’m wearing it.
“That all comes down to Kale Hinnant,” Winslow continues. “He watches me walk and makes micro adjustments so that when I walk out of here, I can’t even tell I have it on. Even when I moved to Greenville, S.C., I still came back here for care.
“They spend time with me when I’m here. Kale not only helps me with my prosthesis, he’s become my friend,” says Winslow, holding up a wooden peg leg Hinnant had crafted for him to be a pirate for Halloween a couple of years back.
“A lot of my patients have become my friends,” Hinnant says. “This business continues for two reasons: we have good rapport with our patients and we travel all over North and South Carolina.”
Hinnant Prosthetics’ in-home service is an industry differentiator. Although many patients are treated in their Charlotte office or in their satellite office in Columbia, S.C., understandably some patients have difficulty traveling or can’t afford the expense.
“We will work with them in their home if it helps,” says Hinnant. “By working in their homes, we know the barriers they face and we can better determine the appliance that serves their needs. A lot of other practitioners can’t do that.”
But traveling to patients’ homes can have its challenges. Per Hinnant, “Google Maps can sometimes only get you so far—so you call them up and ask them if they have a ramp in front of the house or what color the car is in the driveway.
“One time I called a patient for directions and they told me to take a right at George’s Store. Well, I drove and drove but I couldn’t find any George’s Store so I called back. Turns out George’s Store had burnt down 10 years before, but that’s how they remember it.”
On-site fabrication is another differentiator for Hinnant Prosthetics. While the industry trend is to outsource manufacture to a central fabrication site, Hinnant Prosthetics continues to fit and make prosthetics in their Charlotte office just a short hallway away from patient care rooms.
“When patients come in, we can take care of them,” Hinnant explains. “We have the knowledge, the supplies, the equipment and the products right here. The prosthetists and the technicians can consult directly with each other and with the patient. It makes for a better patient outcome and that’s what we’re here for.”
Surviving in Changing Times
But Hinnant admits that he may have to change some of the ways he’s currently doing business. The industry is in a period of tremendous flux. A 2011 American Orthotic & Prosthetic Association State of the Industry report notes declines in net billings, profit margins and revenue per employee.
One reason is downward pressure on pricing. While Hinnant Prosthetics works with the U.S. Department of Veterans Affairs, Medicare, Medicaid, vocational rehabilitation and private insurance; Medicaid rather than private insurance now sets the standard on pricing. Medicare increases of only one to two percent can’t keep up with increases in the costs of materials and overall business expenses, which rise an average of five to 10 percent.
Recent changes in Medicare have also impacted the industry. In an attempt to identify improper payments and correct billing and coding errors, the Centers for Medicare & Medicaid Services (CMS) instituted Recovery Audit Contractor (RAC) audits.
Along with the audits, CMS issued a new prosthetic patient referral documentation guide for physicians known in the industry as “Dear Physician” letters. Both CMS actions create a huge compliance burden for the industry, especially for the small mom and pop firms.
Hinnant estimates that his compliance burden has increased from 10 to 40 percent. A recent industry article cites that 17 percent of small orthotic and prosthetic facilities have closed due to audits and that 75 percent have cut staffing.
Another factor affecting the business is a shrinking patient pool. Amputations from diabetic complications are 80 percent of Hinnant Prosthetic’s client base and account for the majority of prosthetic patients nationwide. Improvements in the care and treatment of diabetes and advances in surgical techniques have led to a marked decline in amputations. The Centers for Disease Control and Prevention reports U.S. amputations down 65 percent from 1996 to 2009.
These challenges leave Hinnant Prosthetics at a crossroads.
“What we need to do is decide what the best approach is going forward,” says Hinnant. “My goal is to structure the company to be an ongoing entity so that it can survive despite outside influences. I’m trying my best to maintain the business because I think it’s important. It’s important to my family’s legacy and to the people that work here to keep it going. But even more than that, I have patients coming to me all the time asking, ‘If you’re not here, what am I going to do?’”
Hinnant has decided to meet these challenges head on. Always active in the industry, Hinnant belongs to five national industry organizations, is past president of the North Carolina Chapter of the American Academy of Orthotists & Prosthetists and is currently on the board of directors for the North Carolina Prosthetic & Orthotic Trade Association. He believes that organizing, educating and being proactive and politically involved is the key to thriving in the future.
Currently he’s meeting with consultants to best craft a new business model. He’s also added administrative defense coverage to his insurance and retained The van Halem Group to assist him with Medicare audits.
“I don’t intend to let these adversities beat me,” Hinnant says. “How can I not fight to keep going when everyday, I see the adversity my patients face and fight and overcome all the time?”