The Scooter Store Inc.

San Antonio, TX: (May-14-07) The state filed a federal false claims lawsuit against The Scooter Store Inc., alleging that the San Antonio wheelchair supplier violated the civil False Claims Act and defrauded the government over reimbursements it owed to Medicare. A series of events led up to the lawsuit brought by the United States in 2005, in which the government alleged that The Scooter Store engaged in a multi-media advertising campaign to entice beneficiaries to obtain power scooters paid for by Medicare, Medicaid, and other insurers. Instead of the "zippy" power scooters that were advertised, the Scooter Store sold the beneficiaries expensive power wheelchairs that they did not want, need, and/or could not use. In a settlement reached, The Scooter Store Inc. will pay the federal government $4 million, and give up many millions more in pending claims for reimbursement to Medicare. In addition to the $4 million cash payment, the San Antonio wheelchair supplier will give up the right to reimbursement for most of its pending Medicare claims. Such claims total more than $43 million, but Medicare estimates that the payments The Scooter Store could actually expect to have received based on those claims, is approximately $13 million. The Scooter Store founder Douglas Trent Harrison, contributed $500,000 and agreed to forego dividends from his shares in the company for the next year in, exchange for a release of his personal liability. [NORTH COUNTRY GAZETTE: WHISTLEBLOWER]

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Published on May-15-07