MELISSA BLOCK, HOST:
In Texas, some 150 state and federal agents raided the world headquarters of the Scooter Store this week.
(SOUNDBITE OF TV COMMERCIAL)
UNIDENTIFIED MAN: ...can help you live a more active and independent life.
BLOCK: You may have seen their ads on TV. The Scooter Store is a major provider of power mobility devices - that's industry speak for motorized chairs and Scooters.
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UNIDENTIFIED MAN: We'll work with your doctor, Medicare and private insurers to help you get the mobility assistance you need. Call the Scooter Store today.
BLOCK: The company says its core ideology is always do the right thing, but the Scooter Store has had scrapes with the law. In 2007, it settled a federal lawsuit alleging Medicare and Medicaid fraud. And in 2011, an auditor found the company received tens of millions of dollars in overpayments from Medicare. Patrick Danner is following all this for the San Antonio Express News. And, Patrick, talk a bit about the raid this week on the Scooter Store's headquarters. It's in New Braunfels, Texas, 150 agents. It sounds like a huge raid. What was going on?
PATRICK DANNER: Well, they haven't said. They basically came in around 9 a.m. on Wednesday morning and directed employees to leave the building. Before they were able to leave, though, they had a checklist of employees that they apparently wanted to interview. So they asked employees to produce ID before they could leave the building.
And they handed out slips of paper with the 800-number for the FBI, I suppose in the hope that they might get some tips from employees. The details of the search warrant are under seal, so we don't really know what the authorities were looking for but we have talked to sources who indicate that it has to do with how the company bills for its equipment.
BLOCK: How it bills for its equipment. Well, we mentioned that the Scooter Store has been under scrutiny for some time for fraud. We mentioned the civil lawsuit by the Justice Department and the auditor's report. What's the concern here? What is the Scooter Store alleged to have done in the past?
DANNER: Well, the issue is that the motorized wheelchairs are being prescribed to elderly people who don't have a legitimate medical need for them. CBS News did a report that I think has brought more attention to all of this, that - in which they talked to some former employees who say that the company bulldozes doctors into prescribing these devices.
There have been efforts to crack down on that, but I just don't know if that's the issue this time.
BLOCK: Patrick, how big a business is this, the motorized scooter and wheelchair business?
DANNER: The last time the Scooter Store revealed its revenues to me, they were in the range of 350 million to 400 million annually. And Medicare in 2011, which are the most recent figures we have, paid $680 million to suppliers of scooters and power wheelchairs.
BLOCK: Has the Scooter Store admitted wrongdoing in the past when they settled that lawsuit with the Justice department?
DANNER: No, and in fact they've been pretty defiant about having done any wrongdoing. They say that they do everything by the book.
BLOCK: Has there been any response from executives at the Scooter Store after this raid?
DANNER: Actually, no. I spoke to their general counsel and he had indicated to me that they would issue a statement to me and that they would make themselves available today for an interview, but I never received the statement and I have not spoken with them yet today.
BLOCK: OK, Patrick Danner, business writer with the San Antonio Express News. Patrick, thanks so much.
DANNER: Thank you, Melissa.
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