Scooter Store Lays Off 200

New Braunfels, Texas

The Scooter Store announced last month that it had laid off 200 employees, blaming Medicare’s reimbursement cuts for power mobility devices.

CMS’ new PMD fee schedule, originally issued Oct. 2, was met with an outcry from rehab industry stakeholders. The agency subsequently increased payments for some power wheelchairs and has since made other revisions to the schedule. However, The Scooter Store said at the time that this wasn’t enough.

“Unfortunately, the Nov. 15 implementation date arrived, and despite some very slight adjustments, the fees were still drastically reduced to unrealistic levels,” founder and CEO Doug Harrison said in a statement.

“Medicare claims the cuts are in response to utilization spiraling out of control,” Harrison said. “The reality is that utilization of the Medicare mobility benefit has dropped almost 30 percent since 2003 and is 10 percent (12,000 units per year) below Medicare’s own estimate of appropriate utilization.”

While the company took other steps to reduce costs before deciding to cut jobs, “we still found it necessary to reduce the workforce so that The Scooter Store can continue operating,” Harrison continued.

“It pains me that 200 men and women and their families are being negatively impacted, largely because the government doesn’t have a system to accurately determine what the proper Medicare pricing should be for power wheelchairs and scooters,” Harrison said.