Raids mark latest turn in Scooter Store fraud probe

Agents carrying boxes during a raid at the Scooter Store's company headquarters outside San Antonio. About 150 state and federal law enforcement officers took part in the raid.
Agents carrying boxes during a raid at the Scooter Store's company headquarters outside San Antonio. About 150 state and federal law enforcement officers took part in the raid. (San Antonio Express-News)
Posted: February 23, 2013

In TV ads, the Scooter Store suggests to seniors and others needing motorized scooters and wheelchairs that they can be had for almost no cost because the company will handle all the messy paperwork with insurers, particularly Medicare.

Wednesday and Thursday brought another example that nothing is free. Somebody - often taxpayers - has to pay.

About 150 state and federal law enforcement officers raided the company's headquarters in a San Antonio suburb. The action was another phase in an ongoing health-care fraud investigation of the Scooter Store, which has an outlet in the Philadelphia region.

A spokesman for the Office of Inspector General of the Department of Health and Human Services, which administers Medicare and Medicaid, would say only that the agency "executed a search warrant at several locations of the Scooter Store and that we were part of a multiagency task force."

The San Antonio Express-News reported that OIG was joined by the FBI and the Texas Attorney General's Medicaid fraud unit.

The Scooter Store's Philadelphia outlet is in Trainer, Delaware County. The manager declined to give his name and referred a reporter to the national office, which did not respond to phone and e-mail requests for comment.

"This raid is a welcome step toward cracking down on waste and fraud in Medicare payments for motorized wheelchairs involving the Scooter Store," Sen. Richard Blumenthal (D., Conn.) said in a statement. "I have urged action to stop abusive overpayments for such devices - costing taxpayers hundreds of millions of dollars and preying on seniors with deceptive sales pitches."

The cost of health care is a huge component in local, state, and national debates about how to solve budget challenges. In recent years, the federal government has increased efforts to scrutinize billing practices and thwart fraud, with durable medical devices being one area of particular concern.

Blumenthal is among the congressional leaders who have urged federal authorities to crack down on what they view as deceptive advertising that results in some angry seniors and bills for all taxpayers.

As Blumenthal noted, this is not the first time the Scooter Store has faced allegations of fraud.

In 2007, the company settled a civil suit with the Justice Department by paying $4 million and forgoing $13 million in Medicare claims after the government alleged the company submitted false claims for power wheelchairs that, among other things, beneficiaries did not want, did not need, or could not use.

The company's five-year corporate integrity agreement with the government was due to expire in 2012 but remains open. The company was also supposed to reimburse the Centers for Medicare and Medicaid (CMS) $19.5 million for overpayments between 2009 and 2011, according to the San Antonio newspaper. However, senators criticized the CMS for not pushing for more reimbursements, based on an outside audit of the company's operations.

The company's website has a specific category of products called "Medicare-Reimbursable Power Chairs," with several listed for $3,699. It posed the question many seniors would ask: Is the power chair or scooter entirely covered by my insurance?

The answer had a few caveats, including the Medicare requirement to meet with a doctor to determine mobility needs. It also said: "If you qualify, Medicare may cover up to 80 percent of the cost of your power chair. Your supplemental insurance may pay the remaining 20 percent. In most cases, our customers pay little to nothing for their power chairs."

Contact David Sell

at dsell@ or 215-854-4506. Read his blog at and on Twitter @phillypharma.

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