Hoveround absent from re-compete

The provider previously accepted contracts in 85% of Round 2 bid areas
Friday, May 20, 2016

SARASOTA, Fla. – As industry stakeholders continue to pore over the list of Round 2 re-compete contract suppliers, one well-known name missing from the list is Hoveround.

In previous rounds of the program, the provider accepted multiple contracts for standard wheelchairs, including contracts in 85% of the competitive bidding areas in the original Round 2; and contracts in all of the Round 1 re-compete areas.

The low reimbursement rates in the Round 2 re-compete—on average, mobility providers will see a 13% reduction for manual wheelchairs; a 5% reduction for power wheelchairs; and 1.5% reduction for scooters—are tough numbers to make work, say providers. 

Still, provider David Beshoar says Hoveround’s direct-to-consumer business model should give it a little more leeway.

“They have more margins to work with than a retailer like me who doesn’t have the benefit of selling at MSRP,” said Beshoar, president of Palatine, Ill.-based MedServ Equipment.

Of course, it’s possible that the provider either didn’t submit bids in the Round 2 re-compete, or didn’t accept contracts.

In early 2014, Hoveround cited burdensome competitive bidding cuts in its decision to lay off 20 workers from its headquarters. Overall cuts in Round 2 averaged 47%.

Hoveround’s recent troubles with the Office of Inspector General could also be why it wasn’t on the list, say providers. 

Hoveround found itself in the agency’s crosshairs in late 2015 after the OIG called for the company to repay the federal government $27 million after a random audit found that 154 PMD claims did not meet Medicare reimbursement requirements. Hoveround says the OIG applied incorrect standards.

“They need to get their ducks in a row before they tackle anything (like competitive bidding),” said Rand Rice, office manager at Orlando, Fla.-based Florida Mobility & Medical Products. “Unless they get the government to relent on the amount, they’re in serious trouble.” HME