Invacare lays off 50

Thursday, October 13, 2011

ELYRIA, Ohio - Invacare, one of the HME industry's largest manufacturers, laid off about 50 employees earlier this month in response to mounting reimbursement cuts.

The layoffs represent less than 1% of Invacare's global workforce of about 6,200, says Lara Mahoney, director of investor relations and corporate communications

"We're looking at all areas to make sure we're as efficient as possible," she said. "Unfortunately, that means we've had to make some tough decisions as far as resources are concerned."

The laid-off employees, described as office staff, were offered severance packages and outplacement services. About 30 of the employees were working at Invacare's world headquarters in Elyria, Ohio, which employs about 1,200.

Invacare, like HME providers, has had to make significant changes to its business to make do with less. The manufacturer, for example, is streamlining its product portfolio globally under the name One Invacare, Mahoney said.

"Home care is a good industry to be in--it's the trifecta of health care: it's patient preferred, it has better outcomes and it's more cost effective," she said. "So we just have to make sure we're all running as efficiently as possible, because it doesn't appear reimbursement will be going up anytime soon."

Invacare last laid off employees in 2006, when it moved some of its manufacturing to China. About 150 employees working at its manufacturing facility in Elyria took voluntary lay-offs.

"We've hired back since then, so the company is continuing to grow," Mahoney said.

Another large manufacturer, Pride Mobility Products, would not confirm or deny that it also has had to lay off employees this year.

"We're always working to adapt our business to whatever the changing environment or circumstances are," said Kirsten DeLay, executive vice president of sales management and operational planning. "We've definitely done some restructuring and reorganization this year, just as we have for the past few years, to make sure that we are set up properly for whatever changes are happening today and in the future."

Both Invacare and Pride Mobility say that, despite layoffs and restructuring, they're still investing in their companies.

"We're always investing in the future as we try to do these things," DeLay said. "Product advancement is No. 1. Because consumers and beneficiaries are only going to want more performance and better products, we're focused on product advancement that brings us good costing but also quality and performance."