WASHINGTON--The U.S. Department of Justice filed suit against The Scooter Store on Friday, charging the New Braunfels, Texas-based company with submitting fraudulent power wheelchair claims.
Filed in federal court in San Antonio, the government alleges The Scooter Store told potential customers who had called in on its toll-free number that Medicare would pay for expensive power wheelchairs but not less expensive scooters.
The government suit is a counter-claim to a lawsuit The Scooter Store filed against HHS earlier this year seeking payment for denied power chair and scooter claims. That suit also charges HHS with violating the law by demanding documentation to prove patient need for the equipment in addition to a physician-signed Certificate of Medical Necessity.
In September 2003, the government rolled out its Operation Wheeler Dealer, including increased scrutiny of all K0011 claims, in an effort to contain fraud and abuse of Medicare's power chair benefit. In October 2003, the FBI conducted interviews with about two dozen Scooter Store employees, which an FBI field agent said was the continuation of a two-year-old investigation of the company.
During 2004, The Scooter Store laid off 400 employees, blaming the government's tightened power wheelchair claims policies. By the end of the year, the company announced it would no longer provide power chairs or scooters to Medicare beneficiaries in the Houston area, citing "drastically more restrictive interpretations of coverage guidance than anywhere else in the country." Harris County, Texas, where Houston is located, is the epicenter of the government's crackdown, where K0011 claims must be personally approved by a member of a special CMS task force.
Responding to the government suit, The Scooter Store President Mike Pfister issued a statement, saying:
"Justice Department lawyers today responded to The Scooter Store's pending suit for Medicare reimbursement with compulsory counterclaims. This procedural action was expected and was necessary for the government to retain its options.
"The government has applied inconsistent standards, violated the law, and wrongfully denied claims. The specific claims made by the government reflect an ignorance of actual conditions faced by Medicare beneficiaries. The Scooter Store will continue to pursue reimbursement from Medicare for power wheelchairs provided to Medicare beneficiaries at the request of their treating physicians. This equipment allows qualified beneficiaries to live more independently, perform the normal activities of daily living, and by preventing injuries and unnecessary hospitalization saves the Medicare system more than two dollars for every dollar spent ...
"Unfortunately, this action by the government indicates that some officials appear more interested in second-guessing the conclusions reached by doctors than they are in making sure that qualified Medicare beneficiaries have access to the medical equipment their doctors say they need."
According to an Associated Press report, The Scooter Store has billed the government for more than $400 million in claims since 1997.