PMD providers make cuts

Sunday, December 31, 2006

WASHINGTON - Two of the largest providers of power mobility devices have laid off part of their workforces due, in part, to CMS's massive overhaul of the PMD benefit in 2006.
Sarasota, Fla.-based Hoveround has reduced its workforce by 66 employees. New Braunfels, Texas-based The Scooter Store has laid off 200. Both providers attributed the cuts to Medicare's increased documentation requirements and decreased reimbursement, as well as, in the case of Hoveround, end-of-the year restructuring.
"We're doing what CMS wants us to do--becoming more efficient," said Calvin Cole, vice president of Hoveround. "We're still committed to working with Medicare to provide a quality product and a high level of service to its beneficiaries."
Before they reduced their workforces, Hoveround and The Scooter Store employed about 630 and 1,200, respectively.
Providers had hoped that further revisions to the new pricing, especially for Group 2 PMDs, would temper any layoffs or changes that they would have to make. They got their wish in mid-December, but it was too little, too late (See story right).
"It if became a 20% cut (instead of a 27% cut), that would be more sustainable," said Mark Leita, director of public affairs for The Scooter Store.
Irvine, Calif.-based Source One Medical has no plans to lay off employees, largely due to the company's decision to diversify into home oxygen and sleep, said Dennis Kline, president (See story right). The company does plan to limit its PMD product and service offerings.
"The patient will get the cheapest chair available--no exceptions," Kline said.
South Daytona, Fla.-based Mobility Products Unlimited has no "major" layoffs or changes planned, said Michael Lops, general counsel.
"We're fine-tuning all the time, but most of our changes have already occurred," he said.
In October 2006, Mobility Products reduced its workforce by 20% due to CMS's decision to replace CMNs with physician prescriptions and medical records (See HME News February 2006).