WATERLOO, Iowa — The actions of a "prominent national provider" are endangering the future of the HME industry, the CEO and founder of buying group giant VGM Group said in a statement distributed at Medtrade Spring in Las Vegas.
"We are endangered by misguided and hostile government policies, and it is getting worse," wrote Van G. Miller in an open letter to VGM group members. "We are also endangered by one prominent national provider, which has engaged in practices and followed policies that have brought this government backlash onto all the rest of us."
In his letter, Miller asked independent providers to consider the business practices of New Braunfels, Texas-based The Scooter Store . The national provider routinely runs television ads that have proven controversial in the industry and also was a winning bidder in several markets in last year's delayed competitive bidding project. In 2007, the company paid the federal government $4 million and agreed to waive another $13 million in Medicare payments to settle Medicare fraud charges.
"Consider the additional costs we all have had to bear lately due to these aggressive marketing practices and regulatory backlash in an environment where our net reimbursement received decreases regularly," Miller wrote. "Think … added documentation costs, audit risks, surety bonds, mandatory accreditation, lobbying time and expense, etc., etc. Most of this could have been avoided if just a few companies had heeded common sense and refrained from figuratively 'poking the tiger with a sharp stick.'"
Mark B. Leita, senior director of government relations for The Scooter Store, responded to Miller's letter: "In light of his accusations, The Scooter Store recognizes there are larger issues plaguing the home care community that require our complete attention, such as rescinding the [interim final rule for competitive bidding]. Our multiple manufacturing partners, as well as the state and national organizations we work closely with, all recognize that if we do not pull together and rescind this government-mandated consolidation program now, quality of care for our seniors will suffer."
Miller also took issue with Pride Mobility Products in Exeter, Pa., saying it continues to supply the bulk of The Scooter Store's inventory. He questioned whether The Scooter Store was getting better support from the manufacturer in service, terms, loaners and trial equipment than other providers.
"Is the provider that insists on using advertising and sales tactics that anger the regulators getting better support and service from a manufacturer than you are?" Miller asked. "Ask … and make them prove to your satisfaction that you are not inadvertently using a vendor who is fighting for the other side."
He noted that other manufacturers — specifically Invacare Corp. in Elyria, Ohio, and Permobil in Lebanon, Tenn. — "have decided not to make these sales at our expense and are thereby not supporting a vendor that is harming the industry and bringing down the wrath of the regulators on us."
Pride is not the only manufacturer servicing The Scooter Store. A visit to the provider's new mobility arm, Alliance Seating & Mobility, for example, shows a healthy list of nationally known manufacturers that supply products to the company.
For its part, Pride refused to be drawn into the fray. "We are very focused on moving the industry forward. Our focus is going to remain on moving the industry forward," said Kirsten DeLay, senior vice president, sales management and operational planning, for Pride.
She pointed to the company's government affairs initiative of working to rescind the competitive bidding IFR and getting the project eliminated altogether, as well as to the company's philosophy of "patient first."
"That's really all around our effort to make superior products at an economic price point, always keeping the needs of the patients … foremost in mind," she said. "Those help all of our providers survive and thrive. In addition to that, we have Pride providers' standards and Quantum [Rehab] standards. And we adhere strictly to those standards. Anyone we do business with has to meet those standards. We feel that's a very important part of helping the industry to move forward in having those standards and making sure we abide by them."
