The Rising Cost of Doing Business in the Mobility and Complex Rehab Technology Industry

Published in Complex Rehab on July 15, 2025

By Tyler Mahncke, SVP of Clinical Mobility and Accessibility, VGM & Associates

Challenges and Strategies for Adaptation

The mobility and complex rehab technology (CRT) industry faces an increasing challenge: rising costs. As the landscape evolves, multiple factors contribute to this situation, including the escalating prices of products, looming tariffs, stagnant reimbursement levels, and surging overhead costs. This article delves into these concerns and explores potential strategies to mitigate their impact.

Escalating Product Costs and Looming Tariffs

The core of the industry’s financial burden lies in the cost of products. Manufacturers are grappling with heightened expenses due to the rising prices of raw materials and components. As production costs soar, businesses are forced to reconsider their pricing models. The introduction of tariffs exacerbates this issue, adding another layer of complexity. If tariffs are imposed, the cost of importing essential materials will skyrocket, pushing product prices even higher.

Rise of Global Import Tariffs

Stagnant Reimbursement Levels

In light of increasing product costs, one might expect a corresponding rise in reimbursement levels from insurance providers and government programs. However, this is rarely the case. In most areas, reimbursement rates remain stagnant, creating a significant financial strain on businesses. The disparity between product costs and reimbursement rates puts pressure on profit margins, necessitating innovative solutions to bridge the gap. It is crucial for industry stakeholders to advocate alongside VGM, U.S. Rehab, NCART, and AAHomecare for fairer reimbursement rates that reflect the true cost of delivering high-quality mobility and CRT solutions.

Surging Overhead Costs

Beyond product expenses, businesses are facing rising overhead costs in several areas:

Fleet Vehicles: The cost of acquiring and maintaining fleet vehicles is climbing, driven by inflation and increased demand. These vehicles are essential for delivering products and services, making their upkeep a non-negotiable expense.
Fuel: Fuel prices are notoriously volatile, and their upward trend adds a substantial burden to operational costs. Efficient fuel consumption is crucial to managing this expense.
Encourage folks to bring their equipment to you for repairs and incentivize them with a promise of a quicker turnaround.

Streamlining Driver Routes

While there are limited options for controlling these overhead costs, optimizing operational efficiency offers some relief. One key strategy is streamlining driver routes. By leveraging advanced routing software and planning tools, businesses can minimize unnecessary travel and reduce fuel consumption. Efficient route planning using a software solution like Onboard Communications ensures drivers are not wasting time and resources on inefficient paths, ultimately saving money and improving productivity.

Staffing Challenges

Staffing has become more challenging and expensive than ever. Several factors contribute to this:

Burnout: High-stress environments and demanding workloads lead to employee burnout, resulting in higher turnover rates and recruitment costs.
Remote Work: The ability to work from home has become a significant factor in the job market. Competing with organizations that offer remote work options adds another layer of complexity to recruitment efforts.
Recruitment, Retention, and Training: The cost of attracting, retaining, and training employees is on the rise. Businesses must invest in comprehensive onboarding and continuous education programs to build a resilient workforce.

Exploring Outsourcing Options

Given these staffing challenges, exploring outsourcing options can be a viable solution. Outsourcing services such as customer service, revenue cycle management (many software companies have their own solution now), and marketing can reduce the burden on internal resources. By partnering with specialized agencies, businesses can access expertise and efficiency without the overhead costs associated with in-house staffing. This approach allows companies to focus on core competencies while ensuring quality service delivery.

In response to rising costs, it is imperative to scrutinize capital expenditure under a microscope.

Scrutinizing Capital Expenditure

In response to rising costs, it is imperative to scrutinize capital expenditure under a microscope. Every investment must be evaluated for its long-term impact and return on investment. Businesses should prioritize expenditures that drive growth and sustainability while minimizing unnecessary outlays. Adopting a strategic approach to capital allocation ensures resources are utilized effectively, supporting the organization’s resilience in the face of economic pressures.

Conclusion

The mobility and complex rehab technology industry is navigating a challenging financial landscape, marked by rising costs and stagnant reimbursement levels. However, by implementing strategic adjustments and exploring innovative solutions, businesses can mitigate these challenges and thrive. Streamlining operations, optimizing staffing, and scrutinizing capital expenditures are vital steps toward achieving resilience and sustainability. As the industry evolves, proactive planning and adaptability will be the keys to success.

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This article was originally featured in the VGM Playbook: Cost Management Trends, Strategies, and Solutions. To read the full article and more like this, download your copy of the playbook today!