(02-02-2013, 02:03 PM)Sleepster Wrote: Huhh?! If the insurance company deems the cheapest one to be "the most Cost-Effective piece of equipment" then that's the one the patient can have with no money due to the DME provider by the patient.
If the patient wants a more expensive unit that costs an additional $250 and the insurance company charges the patient $250 then the profit is the same. On the other hand, if they charge the patient an additional $300 then they get a greater profit.
What part of this am I not understanding?
I'm hopefully not giving too much of a simplistic explanation for this, and I apologize for being so wordy and somewhat repetitive... but from what I've heard from actual DMEs, insurance companies in the U.S. must operate under CMS
guidelines for reimbursement, since CMS has official regulatory oversight over the health insurance industry. The E0601 billing code is used for all classes of CPAP, whether a constant-pressure dumb brick CPAP or a fully data-capable auto-CPAP. (please note that bi-level devices are a separate category using the E0470 code
) And, the reimbursement to the DME is roughly $1500-- no matter what CPAP machine is given to the patient. (I believe the $1500 payment also includes the cost of a humidifier, initial filters, mask and mask parts [under separate codes]).
It makes no difference if the machine is rented or purchased. If purchased outright, the DME is reimbursed $1500 immediately. If it's under the "rent-to-own" plan, that $1500 is stretched out over a few months via a monthly fee, but the insurance company will reimburse no more than the $1500 towards that rental. If the patient who is under a rental plan remains compliant, eventually the patient becomes of the actual owner of the machine and monthly rent-to-own fees stop when it reaches the $1500 level.
Quote:If more than one piece of DME can meet your functional needs, you will receive Benefits only for the most Cost-Effective piece of equipment. Benefits are provided for a single unit of DME (example: one insulin pump) and for repairs of that unit. If you rent or purchase a piece of Durable Medical Equipment that exceeds this guideline, you may be responsible for any cost difference between the piece you rent or purchase and the piece UnitedHealthcare has determined is the most Cost-Effective.
I think this quote from the insurance company is accurate, but it is a general boilerplate statement created to give a standard reply to all patients who have these cost questions. But you have to read between the lines
and understand the terms they are using, especially the use of the word "guideline
We have had several folks here who have the same insurance company and have both been diagnosed with OSA, but one
of them was given a non-data capable "brick", while the other
(who insisted upon a higher-end machine) received a data-capable Auto-CPAP. The only difference between the two is that the 2nd patient was more insistent and did not accept what the DME told them as being completely true.
Although the insurance company statement may seem
to suggest that they
are the ones who makes the decision between a REMstar Plus
, REMstar Pro
or REMstar Auto
based upon cost-effectiveness, that is just not true. They are making that statement to ensure that the patient will not be given an expensive $3900 REMstar BiPAP Auto SV Advanced
, when all they need is basic CPAP that will come in well under the $1500 cost limit. If the patient insists upon the higher cost $3900 machine, this statement is saying that the cost-effectiveness guidelines
(set by CMS) will limit the amount paid by insurance, and in that case
, the patient would have to pay the difference (3900 - 1500 = $2400)
Within the $1500 guidelines, the insurance companies don't really care which one is given to the patient - primarily they are in the business of making money and controlling costs to maximize their profits; they just aren't involved with the practice of medicine, other than to make money by selling insurance policies and paying out as little as legally possible for any claims against those policies, without tarnishing public perceptions of providing good customer service
combined with low premiums
The insurance company pays the same $1500 no matter which of those 3 machines (listed above) are dispensed to the patient. That $1500 is set by CMS. Within that $1500 cost ceiling, the choice of which CPAP is best for the patient is not
determined by the insurance company. Ultimately, it is the patient
who has the power to insist upon a data-capable CPAP or APAP. And they can
insist, as long as the DME's retail price for that unit is less than $1500 (which is usually is). And, in nearly all cases, patients do not have to pay additional costs, since even the cost of the best data-capable APAP is well within that $1500 limit.
The "guideline" they use in their above quote is the $1500 guideline. In other words, they are saying "if you rent or purchase a CPAP that exceeds that CMS guideline cost ($1500), then yes, you as the patient will be responsible for any costs over that $1500 limit"
. Therefore their above statement is basically meaningless to users of standard CPAP, because all of the common CPAPs come in well under the $1500 cost limit.
So, it is in the best financial interest of the DME to give you a low-end, low-cost CPAP machine, because they can pocket more of that $1500 reimbursement money that comes from the insurance company.
I'm simplifying, but here's a basic example
If the DME gives you a $450 REMstar Plus
brick, a $100 mask and a $225 humidifier (adding up to $775 cost), they make roughly $725 gross profit
. ($1500 - $775)
If the DME gives you a data-capable $640 REMstar Auto
, a $100 mask and a $225 humidifier (adding up to $965 cost), they make roughly $535 gross profit
($1500 - $965).
So, the DMEs lie to patients and tell them that the REMstar Plus brick is all they "qualify for". Why? So the DME can make more profit.
Once you understand the terminology and how this system works, you can become more assertive and insist with great confidence that you will only accept a data-capable CPAP or APAP. If the DME does not agree, leave and go to another DME who will be reasonable. But most likely, if a front-line staff member tries to pull the wool over your eyes, ask to speak to the manager. If the DME manager senses that you may walk out the door, they will eventually give in and give you what you want, because making some
profit is still better than making no
We've heard from several members here who have done exactly that
with good results.
Does my explanation make any sense, Sleepster?