Jim Kniff, and with me today is Brad Nagel, who's our CFO. We represent Electromed. We are really excited to be here today and share with you our story. We go on to our next slide, Brad. This is obviously our standard disclosures, which we won't go through, but just a real quick setup for Electromed and who we are. We're basically a respiratory care company that's focused on airway clearance. The technology which we have, which I'll spend a little bit of time on, is the mechanism of action is high-frequency chest wall oscillation. It's really used to help clear the airways for the patients that we serve. We've been in business for 33 years. We're based in New Prague, Minnesota, which is about an hour southwest of the Twin Cities. We do about $62 million in revenue.
The market cap that we have here is a little outdated, but I think it's important to note that all of our manufacturing is done domestically here in the United States. The majority of our components that we use within our manufacturing process are sourced within the United States, about 100 miles within the Twin Cities area. We are really insulated from a lot of the noise that you hear relative to the impact that tariffs could have on one's business. Some other highlights, and these are really on the financial side, as you can see here, we've had a really strong history of revenue growth. Most notably, in the last couple of years, we've really done a fantastic job of leveraging our P&L and really improving our operating income. We are a growing, profitable company. We are a leader within the airway clearance marketplace.
As I mentioned to you before, the mechanism of action, which I'll go through here in a few slides, is HFCWO, and I'll share with you how that actually works. We have a really attractive direct-to-patient and provider model in the home care market. Predominantly, that's where our focus is, not so much in the hospital market, but predominantly in serving our patients in the home. We're growing, we're profitable, we're generating cash, and we have no debt. What's the major disease state that we're serving? It's called bronchiectasis, which is a bit of a mouthful. The characteristics of this disease is it's irreversible and it's chronic. I want to repeat that it's irreversible and it's chronic. Essentially what ends up happening is patients have an infection. That infection then basically inflames their airway passages.
They treat the infection, and then they get an additional infection over time. That repeated vicious vortex of having an infection, treating the infection, clearing the airways expands those airways. That results in repeated mucus buildup, which is really the fuel for future infections. This disease, about a little over 50% of COPD patients have bronchiectasis. This is a misdiagnosed and underdiagnosed disease state. Something that we are really focused a lot of time on is educating and doing market development to get the word out about this so that there is more HFCWO prescribed, which is today one of our great opportunities. As you can see, this is one of the money slides in the deck that you are going to see today. Let me unpack this for you. Basically, the bronchiectasis population is growing about 12% per year.
In the United States, there's been 824,000 patients who have been diagnosed with bronchiectasis. But regrettably, only 127,000 of them have actually been put on our technology or one of our competitors' technology. When you look at the remaining 700,000 patients that are out there, about 230,000 of them are actually being treated by a pulmonologist today. That's really the sweet spot for where our sales reps focus their time and energy. If you take that 230,000 patients times the average sale price for our technology, which is about $10,000 per unit, that's a $2.3 billion market opportunity. That doesn't even include the 4.1 million people in the United States that have COPD, bronchiectasis overlap, who have not been diagnosed. We've got really outstanding market dynamics playing in our favor with great tailwinds. How is bronchiectasis treated?
As I mentioned before, you have what's kind of called the vicious vortex, where there's mucus. You want to clear the airways first. You then want to treat the infection that the patient has with antibiotics. Obviously, to the extent that you can, you want to reduce future inflammation. That is really to prevent future exacerbations from happening with those patients. More specifically, with our technology, let me kind of walk you through what you're seeing here. On the left-hand side, kind of a cartoon depiction of our device, where you have a generator. That generator is attached to a hose. That hose is then attached to a vest. The patient wears the vest. Essentially what that vest does is it gently squeezes and releases the patient's torso.
That mechanism of action forces the mucus from the minor airways into the major airways so that the patient can then cough up the mucus and/or swallow it. That then frees those airways up so that the patient can breathe easier. We do not cure bronchiectasis because this is a chronic, irreversible condition. Really what we're doing is we're helping these patients improve their quality of life. We get asked a lot, how often are these patients on the technology? Basically, they need to use it twice a day, typically in the morning and/or the early evening, 30-minute sessions. Because this is chronic and irreversible, they'll use this technology seven days a week. The other thing that's really unique about Electromed is we're a single product-focused company.
When our sales reps go out and speak to providers, they're not talking to them about a whole raft of different products. They're really focused on our technology. We have best-in-class technology. We've got an incredible industrial design in our product. As you can see, we're the only high-frequency chest wall oscillation manufacturer in the market that has a single- hose device. All of our competitors have two hoses, so it's cumbersome for the patient to use. We have the lightest-weight vest on the marketplace today. It's really the most intuitive to use. We've got VELCRO straps that make it easy for the patients to put on the vest, take it off, adjust it. It's really important because most of our patients are over 65 years of age. Many of them have other comorbidities, most notably arthritis.
You want to have something that's comfortable so that you have an adoption of the technology. The other thing that's unique about our product is it's portable. There's really no on/off buttons. We just have a touchscreen, so it's really intuitive to use. We have a lifetime warranty on our product, which gives peace of mind to the patients with this chronic condition. The other thing that we do that's unique, and this is part of the high-touch piece of our really service continuum, is we provide patient progress reports to the physicians who prescribe this technology. Essentially, when we deliver the product to the patient's home, we do a baseline assessment on how they're doing, how they're feeling. We come back five days later, we do a comparable assessment.
We go back another 30 days after we've delivered the product to do a final assessment. We then collate all that information. We package it up. We then send it to the providers so that they can see the progression that the patient is going through when they're on our technology. This is very unique in this market space. A lot of times what happens is the physicians will write a prescription for something, but they really don't know if what they're writing a prescription for is benefiting the patient. We do this to make sure that they've got some peace of mind that that is actually impacting the lives of the patients that they provide for.
The other thing, in addition to that high- touch there, is we've got great patient satisfaction feedback from using this device, as you can see on the left-hand side of this slide. 95% of patients would recommend SmartVest to others. 97% of patients report feeling better. That's really an important element. On the right-hand side, as you can see, and I know this is probably a little small on the screen, we've really shown that when somebody adopts this technology and is disciplined in using it, there's a 57% reduction in antibiotic use, which is great. Because as I mentioned before, a lot of these patients have other comorbidities. If we can help them reduce the amount of drugs that they're taking, we think that's a benefit.
Obviously, a 59% reduction in hospitalizations and a 75% fewer emergency department visits is not only a benefit to the patient because they would rather have their care done at home, but it is also a cost reduction for the patient and in some instances reduces a never event for the hospitals themselves. I mentioned at the onset of the presentation that we have a unique direct-to-patient model. That really does drive an attractive profit margin. Just to take a step back and zoom out, the way that medical technology is typically delivered to the home is you have a manufacturer. They then distribute that product through a DME, which is a durable medical equipment distributor. That distributor is the one who typically has the payer contracts. They are the ones who are also generating the demand for the technology.
They are the ones delivering the product to the patient's home and collecting the reimbursement from either CMS or from private pay. Our model's really different in that we're not only a manufacturer, but we also have all of the capabilities of a DME distributor. In that we have payer contracts with CMS. We also have it with the majority of private payers on the commercial side. What that enables us to do is we make the product, we sell the product, and we distribute the product to the patient. That enables us to have higher gross profit margins than many of the other folks that are in this space. Our margins are in the mid-70%. Most manufacturers in the home market, their gross profit margins are more like 50%.
Taking a look at our revenue breakdown, the majority of our revenue is in the United States, and it's in the home care market. We have a really nascent hospital business. We feel like going forward, that's going to be a nice gateway for us and another part of the stool that we can start to leverage in getting the patients on our technology in the hospital. As they get discharged, we can support them in the home. We are making investments in that space and looking to expand that. When you take a look at who pays us, about 50% of our revenue comes from Medicare. The other 50% is through commercial payers. Also, as we've been discussing through this presentation, the majority of the disease state of patients that we serve are ones that have bronchiectasis.
Obviously, patients who have cystic fibrosis or neuromuscular conditions can also benefit from our technology. How are we going to continue to grow? One of the keys to our success has been really diligently and deliberately adding sales reps. We're going to continue to do that in the near term. We also, as I mentioned at the onset, this is an underdiagnosed, misdiagnosed condition. We've really invested quite a bit of time and money in direct-to-consumer and physician marketing. That's really paid dividends for us. The other thing that we have done is we've engaged with key opinion leaders to get on podium and share evidence of the benefits of getting on high-frequency chest wall oscillation with the patients that they're serving to help improve their quality of life and getting really the word out on bronchiectasis.
The other thing that, in addition to having best-in-class products, we have best-in-class service. That is really important in this space. It is one thing to have good technology, but you also need to make sure that you are doing a great job serving the clinics that are writing the prescriptions for your technology and helping them work with payers and also doing the same with the patients who ultimately will get our technology. The other thing, and this is kind of a great leverage opportunity for us. Many of you may or may not know this, but a lot of the prescriptions that we get, in fact, the majority of them are through the fax machine, which is kind of a prehistoric way of getting your prescription. We are migrating most of our customers, to the extent that we can, into our e-prescribe solution.
That is not only going to be a great time saver for the clinics that we serve, but also it is a huge efficiency benefit to our reimbursement team at Electromed. What are our long-term objectives? Brad and I do not give guidance to the market, but we have been consistent in saying and delivering double-digit revenue growth and getting continued operating leverage. We expect that is going to continue for the near term. Why invest in us? We are, as I have described, a large expanding market that is not only getting more visibility but has an increased prevalence rate of 12% per year. We have more and more patients coming into our funnel. We have great clinically proven technology, broad payer coverage.
In fact, this fiscal year, we have invested in more payer support, so some expertise in that area to really make sure that we get coverage in some of those areas where we have no coverage today. We've got consistent double-digit top-line growth. As we've talked about, we've got a really strong gross profit margin in the mid-70%. We're generating cash. We have no debt. We're continuing to get operating leverage, which I think makes us very unique as a micro-cap company. The other thing I wanted to share with you is that management's incentives are aligned with our investors. Whether it's me or our management team, all of us really don't get short- and/or long-term incentives unless we're improving our shareholder return. In the case of me, that's basically making sure that we get the appreciation to our stock price.
Relative to management's incentive compensation, when I started two years ago, their compensation was really a 50/50 blend between subjective MBOs and financial metrics. In the last two years, we have really changed the script on that. Everyone within Electromed, for them to get their bonus incentives, we need to increase our revenue and our operating income. We feel like if we do that, that is going to ultimately impact positively our investors. The other thing I would leave you with is the fact that when you take a look at our performance versus the Russell medical in dex averages, we are head and shoulders, whether it is sales growth or gross profit margin or operating margin, head and shoulders above the averages in this space. We feel like we are kind of unique in this market. We have great financial metrics. We have no debt. We are growing.
We have a very outstanding gross profit margin. We're continuing to generate cash. With that, that's our presentation for today. I think we've got some time still on the agenda. If there's any questions that people want to put in the chat, we'd love to answer those. Steven, I don't know if I can see anything in the chat that's come through.
We haven't had someone ask questions yet.
Okay. Give it a minute.
Nope.
I think while we're waiting, if you've got any further questions subsequent to this presentation, please feel free to reach out to our investor relation partners at ICR- Westwicke and specifically Mike Cavanaugh. His name is listed on the slide, as well as his phone number and his email contact details. Okay. We want to thank everybody for your time and attention today. We hope everyone has a fantastic conference. We look forward to having our one-on-ones tomorrow. Thank you so much.
Thanks, guys.
That concludes Electromed Inc's presentation. You may now disconnect. For details on upcoming presentations, please refer to the conference agenda. Thank you for your participation, and we look forward to welcoming you to the next.