Doug Harrison: The Sam Walton of Rehab

Friday, December 31, 2004

As much as anyone in the HME industry, Scooter Store founder Doug Harrison may be a victim of his own success.

By employing mass-marketing techniques and TV advertising to aggressively reach out to seniors, Harrison’s share of the Medicare K0011 market reached an astonishing 57% in 2003.

Like Wal-Mart’s founder Sam Walton, Harrison figured out a new way to deliver a product to the public. He realized that the power wheelchair market, like most retail markets, was shifting. Consumers can think for themselves. They watch TV. They order products online and by calling 1-800 numbers. They shop at mass outlets, and rely less on mom-and-pop retailers.

But even before the Wheeler Dealer K0011 scandal surfaced in August 2003, Harrison’s success raised awareness and concern surrounding skyrocketing K0011 utilization.

His marketing left traditional rehab providers seething and full of venom. Those who shunned advertising and relied on referral sources for their business nicknamed the Scooter Store and its copycats “K0011 mills.” They claimed Harrison and his ilk were “killing the code.”

Medicare officials openly scowled at the Scooter Store’s offer of “free” power wheelchairs to those who qualified. While Harrison’s marketing broke no laws, bureaucrats charged with controlling Medicare spending took the Scooter Store’s success personally.

In the end, Harrison’s success helped convince CMS officials that they needed to develop new power wheelchair codes and distinguish between custom and geriatric mobility. That work, along with efforts to clarify coverage criteria and better define the role of the CMN in claims processing, all have roots in the Scooter Store’s success. These changes, if developed intelligently, will benefit all rehab providers.

Since Medicare began efforts to rein in K0011 utilization earlier this year, the Scooter Store has suffered millions of dollars in denied claims. The company has laid off 400 employees, Harrison has hired his first president ever and freed himself up to scout out new business opportunities for the Scooter Store.

Harrison is a maverick. He goes his own way. The question now is, where will he go next?