Invacare parts ways with the Scooter Store

Sunday, January 20, 2008

ELYRIA, Ohio – Invacare announced last week that it will no longer sell power wheelchairs to the Scooter Store, claiming that, when it comes to national competitive bidding, the nation’s largest mobility provider is “against everything the industry stands for.”

“We feel independent providers are critical to serving the beneficiary, and we feel we are better off in the marketplace with them rather than going with the Scooter Store,” said Lou Slangen, Invacare’s senior vice president of worldwide market development.

After 17 years of focusing on consumer/geriatric mobility and scooters, the Scooter Store began tiptoeing into the complex rehab market late last year. Then, in December, the company circulated a letter to a “handful of congressional offices” making its case that complex rehab should not be carved out of competitive bidding.

Scooter Store CEO Doug Harrison told HME New recently that the carve out bill (H.R. 2231) should be all or nothing. He says it should include complex rehab and geriatric mobility, the provider’s bread and butter, which, Harrison claims, is underutilized and should not be targeted for more reimbursement cuts.

(NCART, an industry organization for high-end rehab providers, crafted H.R. 2231. Many industry watchers believe that to include consumer/geriatric mobility, which has—from Medicare’s perspective— unacceptably high utilization, would doom the bill.)

Harrison said the letter sent to the congressional offices was written quickly and didn’t clearly express the Scooter Store’s position on competitive bidding. That is: It’s a poorly designed program; the Scooter Store opposes it; but if it must go forward, both geriatric mobility and custom rehab should be carved out; and one big bid would be more efficient for CMS than 80 smaller bids.

Some industry watchers called that explanation disingenuous. The content of the letter—no carve out for complex rehab and one big bid—clearly supports what’s best for the Scooter Store—not smaller independent providers who lack the Scooter Store’s deep pockets and geographic reach.

In deciding to no longer do business with the Scooter Store, Invacare is giving up $10 million a year. (The Scooter Store bills Medicare for more than $100 million annually, according to CMS data). Invacare hopes to recoup that money and more by generating additional business from independent providers, Slangen said.

“That is still a lot of money for a company like ours,” he said. “You have to be a realist. When we give up business with the Scooter Store, we are looking to gain that business someplace else. We are giving providers the opportunity to fight the Scooter Store with Invacare products.”

Harrison called Invacare’s decision to sever ties with the Scooter Store an attempt to better position itself with independent rehab providers. Invacare never discussed competitive bidding with the Scooter Store, he said. In a letter to the Scooter Store, Invacare attributed its decision to the Scooter Store’s unwillingness to sign a business agreement, something the Scooter Store does not do with any manufacturer, Harrison said.

“I think they are making a poor decision, but it is their decision,” he said. “The Scooter Store is going to continue to grow. We are going to continue to grow a business in rehab, and we will grow it without offering Invacare product.”