"UpCharge"

General Discussion on any topic relating to CPAP and/or Sleep Apnea.
RDawkinsPhDMPH
Posts: 77
Joined: Fri Dec 03, 2010 7:15 pm
Location: Pensacola, FL
Contact:

"UpCharge"

Post by RDawkinsPhDMPH » Tue Dec 14, 2010 4:33 pm

Apparently, there are a number of DME companies that want you to pay for a more sophisticated machine even if your doctor specifies such. I would like to address this briefly, in part because I haven't really seen it in our area and, in part, because it doesn't make sense.

First, it may not be legal. Since all CPAPs whether simple single pressure machines or auto CPAP with modem data capability are coded the same, they ARE the same in the eyes of the insurance company or Medicare. Many, probably most, provider contracts specifically prohibit what is called "balance billing" which is the practice of charging the patient the difference between the charges and the insurance "allowable" amount. If your doctor does this it is considered insurance fraud and is illegal. Therefore, I suspect the same applies to DME companies. (An exception to this would be some managed care and HMO contracts where the insurance company is also the DME.) Disclaimer: I'm not a lawyer and I didn't even stay at a Holiday Inn Express recently.

Second, it does not make sense at all. Compliance is a complicated subject but my simple model has always been that it's a balance between how much better the CPAP user feels and how much trouble and discomfort is involved in using the CPAP. Thus, it is important to make the user feel better after sleeping on CPAP. (This is easier with severe apnea than with mild apnea, by the way.) And it is important to make it comfortable. I have found, and my data supports, that auto adjusting CPAP, with expiratory relief, is generally more comfortable.

To achieve our best compliance, in our lab we specify only auto adjusting CPAPs with expiratory relief and a modem for data downloads. (Our local DMEs use Respironics or ResMed.) We do not get any resistance from them because they have learned that the added initial cost is more than compensated for by improved compliance and, therefore, fewer returned machines (which cannot be resold as new and some insurance specifies new) and increased supply sales over the life of the machine. The added cost to them is so inconsequential that they only stock autoPAPs and use them in fixed mode on those ordered from other labs (in part also because most people in this area who have problems with CPAP ultimately end up in our lab).

Janknitz
Posts: 8410
Joined: Sat Mar 20, 2010 1:05 pm
Location: Northern California

Re: "UpCharge"

Post by Janknitz » Tue Dec 14, 2010 4:58 pm

RD, you are correct that up charges, or balanced billing, is illegal for any provider in almost every state, and certainly not permitted by most insurers. So in most cases, your DME is doing something wrong if they are asking for an upcharge. RD, I like your approach so much. There would be many fewer of us here needing support and help if we all had RTs like you!

However, as you point out, the situation can be different when your insurer is an HMO--in that case, the HMO may actually be acting as its own DME and simply using the DME provider as a supplier. When the HMO is also the DME, the HMO CAN limit your choice of machines and you may have to pay an "upcharge" for the difference between a CPAP and an APAP. You may also have NO choice in what machine you get. Be aware that if you are on Medicare Part C, also known as Medicare Advantage, you are in this situation, too. Your insurance company--NOT Medicare--determines which machine you will get and you may have to pay an upcharge if you don't like what your insurer provides.

I have Kaiser and that's the way it works at Kaiser. Kaiser is, for all intents and purposes, it's own DME. Apria acts as the supplier, but doesn't get involved in the choice of the equipment at all (they don't want to see or talk to you, unless it's to give them money). Kaiser orders specify the machine, the mask, the hose, even the filter you get. In my region, Kaiser either prescribes a Philips Respironics CPAP Pro or an Auto (thankfully, both are data capable). You don't get a choice of what you will get. And you pay (on my plan) 20% of Kaiser's cost--since Kaiser is the DME, Kaiser's cost for the CPAP is lower than the APAP. I think it cost me about $40 more for my co-pay on the APAP than it would have if they had ordered the straight CPAP for me. HCPCs codes do not apply in many cases when you are dealing with an HMO or advantage plan.
What you need to know before you meet your DME http://tinyurl.com/2arffqx
Taming the Mirage Quattro http://tinyurl.com/2ft3lh8
Swift FX Fitting Guide http://tinyurl.com/22ur9ts
Don't Pay that Upcharge! http://tinyurl.com/2ck48rm

User avatar
chunkyfrog
Posts: 34377
Joined: Mon Jul 12, 2010 5:10 pm
Location: Nebraska--I am sworn to keep the secret of this paradise.

Re: "UpCharge"

Post by chunkyfrog » Tue Dec 14, 2010 5:05 pm

Is it legal in Nebraska?

_________________
Mask: AirFit™ P10 For Her Nasal Pillow CPAP Mask with Headgear
Additional Comments: Airsense 10 Autoset for Her

Janknitz
Posts: 8410
Joined: Sat Mar 20, 2010 1:05 pm
Location: Northern California

Re: "UpCharge"

Post by Janknitz » Tue Dec 14, 2010 5:08 pm

Google your state and "balance billing" and see what pops up. It's illegal in 47 states, I'm not sure which three it is not outlawed in. And each state has a different interpretation and treatment of the issue, so you will have to look for info on your own state.

It is ALWAYS illegal for traditional Medicare (Parts A and B)--doesn't matter what state you are in, it's a violation of Federal law.

Edited to add: Look what I found: http://www.statehealthfacts.org/profile ... t=7&rgn=29 You can plug in your state and get comprehensive information.
What you need to know before you meet your DME http://tinyurl.com/2arffqx
Taming the Mirage Quattro http://tinyurl.com/2ft3lh8
Swift FX Fitting Guide http://tinyurl.com/22ur9ts
Don't Pay that Upcharge! http://tinyurl.com/2ck48rm

Healthcare_change

Re: "UpCharge"

Post by Healthcare_change » Thu Aug 27, 2015 12:32 pm

Sadly, your statements are too general to be accurate. It is correct that for Medicare, Medicaid and specifically preferred provider contracts, the contracts specifically state that the DME agrees to the fee schedule and cannot bill more than the fee schedule or "allowed amount." However, there are many exceptions, including with Medicare, Medicaid and preferred provider contracts. It is often up to the language of the contract. In most cases, the insurer dictates what they call the "allowable table" with limited information on the items. The DME is forced to take it or leave it. These tables are often very limited in their number of items covered. For example they pay the same for a particular HCPC code such as E0601, which is a standard CPAP. However a CPAP machine can range in cost to the DME from $100 to $1,000 depending on the functionality and bells and whistles on it. This is true of other items such as wheelchairs, CPAP masks, walkers.... the same as automobiles. The DME has a contract and has agreed to a single price, but has also agreed to the basic product and can limit brands of products. In this case, certain DMEs can and will inform the patient if they want something extra (software for monitoring at home, a customized bag, extra cushions) that is not covered by the insurance, the patient will have to pay extra.

In most cases, DMEs should follow the Medicare guidelines, which allow for Advanced Beneficiary Notice, or ABN. In this case, the DME is saying "Medicare will only cover X. If you also want Y, you will have to pay for it." Or in many cases "Medicare may or may not pay for this item or procedure based on your diagnosis and notes. We don't know. However, if they do not pay for it, you will have to. We are giving you advance notice." This same communication is often used if the DME has a set formulary of products. They can inform the patient in advance "If you want the premium item, you will have to pay your co-insurance plus $xx." This is not illegal if the notice is given in advance and this is not the simple product covered by the contract with Medicare, or other insurer.

Not to get on the soapbox, but this brings up two issues that probably affect patient pricing more than anything. The first is bureaucracy. The paperwork needed for a simple CPAP has gone up almost 15 fold in the last 5 years. iIm not sure anyone has said this area is being abused. (Other than in South Florida, where false doctors bill false claims on behalf of false patients.) The stated reason is better care. The real reason is cost savings. If the insurers can make it harder for people to get their supplies, then they are less likely to use them and thus save the insurer in the short term. However, this additional documentation (I could write a whole article on wasted hoops that have to be jumped through) adds approximately 40% to the cost of delivering most DME. If we want lower costs we should demand less bureaucracy. More connectivity between Dr., supplier and insurer.

Lastly, one of the true outcomes of Obamacare is the dramatic increase in annual deductibles. From a typical $500/year 10 years ago to suddenly $5,000/year per patient. Patients are now paying much more out of pocket. A second outcome is dramatically lower reimbursement for items, which has driven a lot of ABN or balance billing to get to a price your DME can live with. This means, as a consumer, you need to look at prices. Whether it be balance billing, premium billing or add on billing that increases your rates, or you negotiate a lower cash price with your provider, it is now in your control. The days of the American expecting to get healthcare for free are over.

My point? Rather than complaining that "balance billing is illegal "(it is, but in many cases the DME is not balance billing or is not obligated to not balance bill), it would be more worth your time to shop around. Speak to the DME. Get their prices. Perhaps negotiate a cash price if you still have a large deductible left (they save a ton on paperwork - why not pass those savings on to you?) But know what to expect.