Invacare Stops Sales to Scooter Store, Seeks Independent Provider Support
- By Laurie Watanabe
- Mar 03, 2008
Invacare Corp. and its rehab divisions have stopped selling new power mobility vehicles to The Scooter Store and will not sell complex rehab equipment to The Scooter Store’s new rehab company, said Lou Slangen, Invacare’s senior VP of global sales and marketing.
In a Jan. 22 interview, Slangen said Invacare had already stopped selling new vehicles to The Scooter Store. Invacare will continue to supply replacement parts to The Scooter Store to support vehicles sold in the past, Slangen indicated.
Invacare’s multiple rehab divisions, including Adaptive Switch Labs, Freedom Designs and Motion Concepts, will also decline to sell to The Scooter Store and its new rehab division.
The Scooter Store has branch offices nationwide that sell consumer power chairs (The Scooter Store prefers the term “geriatric” power chairs) and scooters. In early January, the company announced it was expanding into the rehab market via a division called Alliance Seating & Mobility. Scott Higley, former VP of sales for Quantum Rehab, is among the leaders of that division.
Slangen estimated that Invacare stands to lose an estimated $20 million this year because of this move, but said the decision was necessary because of The Scooter Store’s competitive bidding beliefs and actions. Slangen cited an e-mail he said was sent in December by The Scooter Store’s Mark Leita, director of public affairs, “to various Congressional offices... That letter articulates that The Scooter Store says that they do not want to have a (competitive bidding) carve-out for complex rehab, and they are also for competitive bidding.”
As a result, Slangen said, “Based on Scooter Store’s stance in the industry, we have taken the action to part ways... We are not selling (The Scooter Store) any power wheelchairs, any finished products.”
A copy of the e-mail message in question was forwarded by Invacare. The Dec. 14, 2007, message shows Leita as the author and says in part, “By now, you are aware of a few power wheelchair initiatives currently being considered by Congress. Among those initiatives is carving out complex rehab from the soon to be implemented national competitive bidding (NCB) program. The Scooter Store believes making exceptions like this will affect the integrity and viability of the bidding process.”
Says Slangen, “We feel that what Scooter Store’s position is is against everything the rehab industry stands for and that the consumer is better serviced by the setup that we have today with the independent providers, with the services they provide. We feel that fighting for the carveout for complex rehab is better for the consumers, is better for the providers, and is better for Invacare and the total industry. That’s the stand we have taken.”
Leita, also speaking to Mobility Management on Jan. 22, did not deny sending such an e-mail, but said, “There are people out there who have grossly misinterpreted our position on competitive bidding... Our position all along has been consistent with the industry’s message. We’ve been very optimistic that people will understand where we’re coming from once they understand what the e-mail really meant. We’ve always supported the Tanner-Hobson bill and the Conrad-Hatch bill — that’s first and foremost.”
The Tanner-Hobson and Conrad-Hatch bills have sought to reform competitive bidding via the House and the Senate, respectively.
The Leita-attributed e-mail in the middle of the uproar also says, “The Scooter Store has always supported the position that the American taxpayer should be paying fair market price for all products and services. While competition has helped define America, we have also shared with you our concerns about the manner in which the program is being implemented city by city, rather than other governmental procurement programs that are national in scope. We are concerned that this style of NCB is not the best operational decision for the Medicare program.”
The Industry Reacts
Industry reaction to the Invacare/Scooter Store news was swift, with publicly aired opinions seeming to run heavily against The Scooter Store.
In a letter sent out Jan. 23, the National Association of Independent Medical Equipment Suppliers (NAIMES) said it “strongly opposes competitive bidding in any form... NAIMES also strongly supports the carve-out of complex rehab as proposed in H.R. 2231... NAIMES applauds the stand that the Invacare Corporation has taken in unity with independent equipment suppliers by announcing their decision to cease doing business with The Scooter Store.”
The day before, the National Registry of Rehab Technology Suppliers (NRRTS) said in a letter to members and friends of the organization that it supported Invacare’s decision.
NRRTS also distributed a fax supporting a carveout from competitive bidding, along with letters to Congress from comedian Jerry Lewis, a long-time supporter of the Muscular Dystrophy Association, and other advocacy groups who urged Congress to guarantee consumer access to complex rehab equipment. NRRTS Executive Director Simon Margolis referred to “a large, national power wheelchair supplier” and said that company’s “rogue opinion is not shared by the organizations and associations that represent complex rehab suppliers and manufacturers.”
Slangen says Invacare anticipates losing $10 million this year in consumer power sales, “plus of course we are giving up any potential sales on complex rehab. We are probably giving up a total of about $20 million worth of business by parting ways with The Scooter Store. We feel it’s not right for the consumer, it’s not right for the providers (to say), ‘We should have a carveout for all power wheelchairs,’ which is not going to happen.”
“What we are doing right now are two things,” Slangen said. “We are betting that all other providers will support Invacare, and the reaction we’re getting so far is very strong on this subject. And we are banking, obviously by walking away from up to $20 million worth of business with The Scooter Store, that those other providers are going to turn business over from companies that are supplying The Scooter Store.
“I would say in the rehab industry, this is the most defining moment in my 20 years that I’ve been in it,” Slangen said. “How are we going to go forward in our industry? Are we going to drive complex rehab to the lowest common denominator, or are we going to service the patients, the consumers, in the proper way with the right product and give people the opportunity to (receive) the reimbursement whereby they can service those beneficiaries, those consumers in the proper way? That’s what’s on the table right now.” Slangen said Invacare believes that excluding rehab from competitive bidding is absolutely necessary to preserve proper patient access and service.
“The products that consumers require, from the power chair itself to the seating system to all the other parts that go with that fitting, such as a sip-and-puff, the electronics, all of these things will obviously come under tremendous pricing pressure,” he said. “The consumer will not have access to the product that gives them the best quality of life. Secondly is the service component. The provider doesn’t have the room anymore to do the proper assessments, to do all of the things that are required. That’s the reality as prices go down through competitive bidding on complex rehab.
“Invacare has chosen the route of betting on the providers that we have, and pushing the carveout of complex rehab. That ends up being the best for the consumer, the best for the provider and the best for Invacare.”
This article originally appeared in the March 2008 issue of Mobility Management.
Laurie Watanabe is the editor of Mobility Management. She can be reached at firstname.lastname@example.org.