Two for One

It has been said that “two is better than one” — and that seems to be true when it comes to the current state of the U.S. scooter market.

The market is growing for two reasons: The aging baby boomer population is becoming increasingly interested in new technology that will enable them to remain active and independent. Additionally, recent reimbursement modifications have made scooters a more accessible option for those who require powered mobility devices.

These sales drivers have prompted home medical equipment providers to develop both sets of customers through effective evaluation, marketing, sales and service.

“There are significant growth opportunities in this product line,” states Ben Kingery, Invacare Corp.’s group product manager of powered mobility.

He explains that the change in CMS’ coverage policy for mobility assistive equipment has had a major impact on this market. Last year, the agency released new function-based criteria as a basis for coverage, resulting in evaluations that focus on beneficiaries’ ability to perform daily living activities such as toileting, grooming and eating. The change takes clinicians through a “stepped” process to determine which mobility device is medically necessary. It also eliminates the requirement for a specialist to prescribe a scooter.

“It appears that [the new criteria] will increase the number of scooters being prescribed,” says Kingery.

“When we did our consumer research, it seemed like there were a lot of people who wanted to get a scooter, or thought they needed a scooter, but they didn’t really want to go see a specialist or didn’t know even where to begin to find one.”

Pieter Leenhouts, vice president of standard products for Sunrise Medical, agrees that the elimination of a specialist’s prescription has had a positive effect on market growth. “From a Medicare reimbursement point of view, a lot of hurdles were removed for this market to grow,” he says.

“Then on top of that, the market itself — just from consumer cash business — is growing very rapidly as well because the demographics have shifted, and scooters are becoming more accepted products for people to use as a mobility device.”

The stepped approach to coverage for mobility equipment also has shown that many consumers really belonged in scooters rather than power wheelchairs, says DuWayne Kramer, president of Leisure-Lift. Aimed at making sure Medicare beneficiaries end up with the appropriate prescription, the criteria begin with the simplest devices, such as canes and crutches, then progress to products such as manual wheelchairs, scooters and power wheelchairs.

In fact, responding to HomeCare’s 2006 Forecast Survey, more than 40 percent of providers said they think their scooter business will increase as a result of CMS’ new function-based approach to mobility coverage. And in the magazine’s 2006 Mobility Survey, the largest group of providers said they expect scooters to be their companies’ fastest-growing mobility product this year.

But the rules that go along with power mobility reimbursements also are new. There is some confusion regarding the Interim Final Rule for power mobility, which took effect in October 2005 but has now been put on hold by Congress until at least April 1. In place of a certificate of medical necessity, the rule requires a face-to-face physician exam and supporting documentation, such as patient chart notes, to substantiate medical necessity for the equipment.

“Providers should follow the rules, which are a little cumbersome now, but doable,” advises Leisure-Lift’s Jim Ernst, chief operations officer. “Physician assistance is needed, but if you work with them, they can provide you with what you need. Also, use the [CMS] algorithm to make sure you get the patient in the right product, and make sure you can prove that.

“This has always been [the case],” Ernst points out, “but people have just never been held to the gun.”

The good news? Kramer says that along with the new coverage policy, new power mobility codes — currently under review by the SADMERC — also will create opportunities for new types of scooters. “We have seen a lot of the code recommendations, and they are going to open the door for new types of scooters that you don’t see right now,” he says.

Focusing on Consumers

Consumer awareness is yet another factor with a positive effect on scooter sales, according to Cy Corrigan, Pride Mobility’s national sales manager for retail. “We really credit providers for getting the word out about scooters to consumers and educating them through mailers, advertising and the print media,” he says. “We see it as a very good market.”

The look of scooters also has changed, which, in turn, has changed the way consumers — particularly baby boomers — view these products. “Scooters have now become products that aren’t so medical looking,” notes Kristen Imperiale, Pride’s director of marketing. “They don’t have that stigma, so it’s much more acceptable for somebody to be going away on a vacation and running around on a scooter. It just makes life easier.”

David Lin, Shoprider Mobility Products’ president, agrees that growth in the market is related to the acceptance of more stylish products. He says the “better-looking, more functional units mean less dignity issues or concern by the end users.

“Just like boating or other recreational activities, as awareness improves, scooters become more of a lifestyle or leisure product, and the market’s size will continue to grow as … acceptability continues this trend,” he says.

Now that accessibility is no longer a hindrance, is the HME industry prepared to meet the demand for scooters? It depends, say the experts.

Mass merchants and discount department stores also have noticed the increase in scooter sales — and want a piece of the business — so HME providers must compete with and even beat them in the race to become the community source for scooters.

Rick Davis, Access Point Medical’s director of marketing, says providers need to emphasize selection and service. He also stresses the importance of a strong presence in the marketplace.

“People will go where there is good support and good service, and HME providers are very well-positioned for that type of service,” he points out. “They must have a strong presence in their local market, so that when someone needs a scooter, they will make the connection.”

Although this may be true, selling scooters to a retail market — like anything else that is new — may be more challenging to providers than it appears.

“It may require a [change in marketing plans] for a community-based rehab provider, who really has been an expert in taking care of the paperwork to get the medical product reimbursed from either an insurance company or Medicare or Medicaid and isn’t really taking cash directly from the consumer,” says Kingery.

“It seems like it would be an easy thing to make that mindset shift to being able to do business just like any other [retail] company would. Yet from my experience, it seems for some people it is a difficult change to make in terms of the mentality of how they operate their business … It is just a different way to do business.”

Likewise, he continues, providers need to be sure they are maintaining their mission. “[Providers] don’t necessarily want a lot of foot traffic if part of their business is to provide products for people who have a medical need. They don’t want to jeopardize that part of the business because that’s extremely important,” Kingery explains.

“The challenge is in operating in both ways — both on the cash side with a retail mentality, and then also providing for community-based rehab customers.”

Marketing to the Masses

Once providers have established that they can — and want — to create a balance between providing products and services to their medical customers and promoting a retail, cash-based business, there are steps that can promote success. One includes utilizing available manufacturer resources.

An example is the use of consumer financing programs. When scooters are bought as a convenience, or luxury item, a finance program can often overcome one of the main hurdles: cost.

“Consumer financing is very important. It offers monthly payments as opposed to paying all at once or putting the entire cost on a credit card,” notes Pride’s Corrigan. “[A] consumer financing program, similar to those used when purchasing furniture or an automobile, really helps, and is a tool for providers to use in increasing retail sales.”

A number of scooter manufacturers offer help to HME providers in attracting consumers and converting leads into product sales. Based on the particular vendor, programs may include a variety of media formats such as television or direct mail, in-store merchandising displays and consumer financing programs, all of which can be helpful when marketing scooters.

But it is important to remember that a home care company’s scooter business must be individualized, says Kingery. “A generic marketing plan never seems to work,” he says. “The business is so dynamic that you have to keep trying new things and adapting to the way people are doing business and the way people are buying products.”

The industry has done a good job of creating an awareness of the benefits scooters offer, says Leenhouts of Sunrise. So, the challenge is not to inform the public about the products but how providers can distinguish themselves from their competition.

“More people are aware today than five years ago that there are ways for them to continue to be active in their community or in their home through powered mobility, and scooters are primarily seen as outdoor products that allow people to be active. They understand that now,” he explains.

“The things that are going to make providers successful are those that really differentiate them.”

Leenhouts says providers should focus on how they can set themselves apart. “Is it through providing a unique product, a unique service or a unique sales experience?” he asks.

“It has to do with the value proposition those [HME companies] provide in the marketplace, whether that is value pricing or whether that is superior service and support. If you get to the point where you are just a product and a price with information being available on the Web, it’s very easy for people to just shop for a given product for the lowest price.

“Providers need to differentiate themselves in terms of breadth of product offering, service and sales support.”

Creating an Accessible Market

As interest in scooters grows, small-sized, lighter and more portable scooters seem to be taking the lead due to consumer demand for portability, says Shoprider’s Lin.

Pride’s Corrigan adds that the travel-scooter market is showing great promise because of the convenience these models offer in terms of maneuverability, portability and ease of assembly.

And Kingery of Invacare points out that the affordability of smaller scooters also has made an impact.

“There have been reductions in pricing to the consumer that have made the micro portable-sized scooters affordable,” he says. “We’re getting closer to the magic number where more and more people can actually afford a scooter even if they don’t qualify for it.”

Although much of the industry’s emphasis is on the smaller, portable scooter style, the technology is also being incorporated into most other models.

“We have taken the technology and the improvements and have carried that through our complete line of products,” says Corrigan. “If someone is looking for an economy scooter, a mid-range scooter or a higher-end luxury scooter, we’ve continued to make advancements across the whole scope of the scooter line, making sure that we’re hitting each market area.”

Experts Interviewed

Cy Corrigan, national sales manager for retail, and Kristen Imperiale, director of marketing, Pride Mobility Products, Exeter, Pa.; Rick Davis, director of marketing, Access Point Medical, St. Louis; Jim Ernst, chief operations officer, and DuWayne Kramer, president, Leisure-Lift, Kansas City, Kan.; Ben Kingery, group product manager of powered mobility, Invacare Corp., Elyria, Ohio; Pieter Leenhouts, vice president of standard products, Sunrise Medical, Longmont, Colo.; and David Lin, president, Shoprider Mobility Products, Carson, Calif.