Resmed price fixing

[birdshell]

Jeez, I just got my lovely ResMed S8 flow generator in April and now I feel guilty for loving it!

Seriously, though, ResMed should want to do the right things. Idealistically, doing the right things should pay off bigger in increased business income.

Take Rested Gal as an example. The ill will engendered by this move has GOT to hurt ResMed; if we are all aware and take similar steps, then ResMed should feel the pinch. She is a long-time user of all kinds of xPAP supplies and equipment; she has even invented some things that have helped make the equipment palatable to more users. These things have helped the companies to sell more. If she is so set against this policy, where is the goodwill?

And what about the insurance companies? They are dictating doctors fees, prescription charges, hospital charges, etc. Will ResMed REALLY make more by limiting sales to DME providers in brick-and-mortar locations? But I went in to the DME provider and took what they gave me, because I really did not know any better.

Then again, I tend to be wildly idealistic and optimistic, so the above could be totally subjective. I hope not, but am afraid Rested Gal may be right about the effects of the ResMed internet price balloon.

[NightHawkeye]

Sadly, I think ResMed's gambit will work. As more and more local DMEs tell the Respironics reps who call on them, "Hey, we're stocking ResMed now because they're helping us fight off internet pricing. What are you guys doing to help our business?" what do you think Respironics will do? I think Respironics will do the exact same thing to online stores sooner or later -- require them to "price our products at no less than this amount or we won't let you have ANYthing to sell." That will be the way to demonstrate to the local DMEs that a manufacturer is DME friendly.

RG, I'm sure you're right. Being the eternal optimistic I am though, I think that the day Respironics implements the same policy is the day that the "law of unintended consequences" kicks in.

Just like the physical law which states that for every action there is an equal and opposite reaction, the reaction to this price fixing scheme will not be at all what the implementers of the scheme had hoped for. I can envision at least a couple of possibilities:
1) the day that Respironics joins in this silly price fixing scheme is the day that a class action suit gets filed which ends this nonsense, or
2) the day that foreign vendors take control of this market away from ResMed and Respironics.

I think both of these scenarios are real possibilities. I don't for one second believe that the internet vendors will give up without a fight. Just remember that the only reason ResMed implemented this policy in the first place is because the internet vendors are becoming a formidable market force, large enough to threaten the status quo.

No one knows precisely what will happen, but I'm not willing to bet against free market forces.

Regards,
Bill

[Guest]

I think there are 2 very large pieces of the puzzle that most are missing here, and I doubt would even believe.

1) Most of the dme companies of the world do add a tremendous amount of value to patients. I know that the majority of the people here are here primarily because they had very bad time, but the majority of the dme's out there have proven themselves to be beneficial to patients. They have passed constant inspections from regulatory agencies, insurance companies and patient surveys. Again, yes, it is a fact that the majority of the people here have not seen that. It does not change the fact that this is true though. With that in mind, most of the decision makers at insurance companies and at various manufacturers will see the wish to bring internet retailers pricing more inline with traditional models as a good thing.

2) Another frequent point of contention with this is that it will shut out those without insurance or who otherwise need equipment. However there are nearly always any number of different ways for someone in need to get equipment. Between Medicaid or similar programs, Medicare for seniors, and a dozen other state, local or other organizations basically anyone can get the equipment. It may not be as simple as just picking up the phone and calling 800-cpap-now or something, but it can be done and is done hundreds of times a day. Toss in the mix that almost every dme company out there will have a program for uninsured or low-income people it just makes it that much easier.

I really don't know if I fully agree with the choice to set a minimum price. I do agree that it is totally within ResMeds domain to do so. Overall, I admit I see the reasoning behind it.

[jkeene]

...
Most of the dme companies of the world do add a tremendous amount of value to patients.
...
They have passed constant inspections from regulatory agencies, insurance companies and patient surveys. Again, yes, it is a fact that the majority of the people here have not seen that. It does not change the fact that this is true though.
...

The Big Dig tunnels had their inspectors. Enron had their auditors. I don't need to have met the inspectors and auditors to know they did a really terrible job.

[Darth Vader Look]

Price fixing is a felony in the US (and probably in Australia also) and its elements are clearly defined. Price fixing is when companies get together and all agree up front what prices will be and they all raise thier prices. If you do not have evidence this has happened, then it is not price fixing.

Sorry but that would be referred to as collusion which is also illegal.

Just as Ric has pointed out Guest is a voice working for a brick and mortar DME. They must have been hit hard by the internet sales sites. My understanding of markets and marketing is it really comes down to supply and demand (no need to explain this). Resmed doesn't want to follow that. Resmed will sell the equipment to any business registered with them for a price based on production and overhead costs and add a certain profit margin based on studies they have done. They may even throw in a discount based on volume sales. DME's turn around and double and triple the prices of this equipment yet online sellers don't. The DME's whine, cry and maybe threaten to dump Resmed products if Resmed doesn't handle this soon. In turn Resmed comes up with some unsubstantiated excuses that internet sellers have to set their prices for Resmed products at what a DME sells them for or stop selling Resmed products. Reference the first post in this thread http://cpaptalk.com/viewtopic.php?t=10666 to read the whining and crying .

How many times do we see people not getting the equipment they want or that is prescribed for them by their doctor. DME's like to play God with unsuspecting clients, tell little white lies and just go all out for maximum profit at the clients expense. Yet Resmed seems to justify this by backing their demands. Really sounds like Resmed bowing to the DME gods.

I guess you can tell that I am still on the fence, so to speak, when it comes to whether or not a DME is a good thing .

[Guest]

How exactly does the pricing at the DMEs work for someone with insurance and a person with no coverage?

Does the insurance pay the same price that is quoted to the individual?

Does the brick and mortar guy say hey you don't have insurance, I won't have to hold your hand and look over your shoulder, fill out forms etc. to get paid, I'll sell this machine to you for the same money I get from insurance?


Something I read recently gave me the idea that we were moving in the direction of only renting flow generators. In other words you would never stop paying and you would never own it. The machine would go back to the DME when you die. Is this a dream come true for the DMEs?


I guess it is a good thing to bring internet retailers pricing more inline with traditional modes. After all we have all sorts of meddling in our markets. Just look at MILK.

[NightHawkeye]

1) Most of the dme companies of the world do add a tremendous amount of value to patients . . . the majority of the dme's out there have proven themselves to be beneficial to patients . . .

If we accept this premise as true, or at least the part that local DME's provide superior service to online providers, then the following must also be true:
1) Patient compliance and therapy success is better when local DME's are used.
2) Patient compliance and therapy success is worse when online DME's are used.

Would you agree with that, Guest?

I don't think that I believe it. In studies performed when DME's were the dominant equipment providers, it is well documented that patient compliance and hence therapy success is only around 50%. That is an abysmal rate by anyone's measure, so I would suggest to you, Guest, that your premise is flawed, and should be properly reworded as: Most of the dme companies of the world do a very poor job of meeting the needs of their patients . . . the majority of the dme's out there have been proven to be add little value to the therapeutic success of their patients . . .

Regards,
Bill

[Guest]

[quote="NightHawkeye"]In studies performed when DME's were the dominant equipment providers, it is well documented that patient compliance and hence therapy success is only around 50%.
Regards,
Bill

[NightHawkeye]

Source plz?

A number have been previously posted on cpaptalk, but here's one which you might find of interest. It comes from RT Magazine - The Journal for Respiratory Care Practitioners.

http://www.rtmagazine.com/article.php?s=RT/2003/06&p=4

". . . compared with an even lower effective compliance rate of approximately 46% in the United States. Pepin et al believe that the difference in effective compliance rates between Europe and the United States is due to variations in prescription and technical follow-up care."

Interestingly, I believe that this one comes to the same conclusion I did. The poor compliance is the direct result of the level of DME care being provided.

Regards,
Bill

[billbolton]

should be properly reworded as: Most of the dme companies of the world do a very poor job of meeting the needs of their patients

"Most of the world" does not have to endure the US health insurance system or DMEs

Cheers,

Bill

[NightHawkeye]

"Most of the world" does not have to endure the US health insurance system or DMEs

I did find it interesting that compliance rates, as listed in RT Magazine, were so much higher in Europe than in the US. Perhaps some of our European members will comment on that.

Regards,
Bill

[snork1]

[quote="Anonymous"]How exactly does the pricing at the DMEs work for someone with insurance and a person with no coverage?

Does the insurance pay the same price that is quoted to the individual?

Does the brick and mortar guy say hey you don't have insurance, I won't have to hold your hand and look over your shoulder, fill out forms etc. to get paid, I'll sell this machine to you for the same money I get from insurance?


Something I read recently gave me the idea that we were moving in the direction of only renting flow generators. In other words you would never stop paying and you would never own it. The machine would go back to the DME when you die. Is this a dream come true for the DMEs?


I guess it is a good thing to bring internet retailers pricing more inline with traditional modes. After all we have all sorts of meddling in our markets. Just look at MILK.

[rested gal]

That's a great link, Bill! Well written information from a Registered Respiratory Therapist. I thought this part farther down in the article was also very interesting:

The factors limiting effective compliance with CPAP can be divided into three groups: problems with the upper airway and/or the upper-airway mucosa, with mask fit or discomfort, and with equipment. Two other common problems contributing to poor CPAP compliance are poorly trained or inexperienced staff and lack of proper education and training of patients. (bold emphasis mine)

The apnea message boards are full of posts by people who have been through the local DME's revolving doors. People who have been given machines they can't breathe out against, masks that leak and chew up the bridge of the nose, chin straps that do next to nothing for mouth air leaks...the list goes on.

Some would say, "Well, people who aren't having a problem don't seek out a message board. Message boards are skewed toward whiners and complainers."

I say -- most people who are having a problem with cpap treatment don't even know message boards exist. Many are of the mindset that "the doctor knows best". They figure the home health care store is giving them what the doctor thinks best for them...the specific machine and mask that the doctor wants them to use for best treatment.

Most people, imho, who are put on cpap have no idea there's any way to make this kind of treatment more comfortable. They are not complainers. They try very hard to do it. They rarely (if ever) use a computer or know much about the internet. They don't find their way to a message board like this one. Finally, way too many of them just quietly take the mask off and put it away in a drawer. They are the silent dropouts.

I'd bet that way too many of the dropouts remain on the books of the DMEs as "patients on cpap" and are reported in surveys as "compliant" - with Medicare and insurance paying rentals month after month after month for machines that are gathering dust in closets all over the country. How many people out there have had a DME actually contact them to check their machine or card for "compliance -- hours of use?"

Not to mention the ridiculous definition of "compliance" as being cpap treatment for at least (just!!) 4 hours a night. But that's a whole other subject.

If the patient doesn't call with a complaint, everything's going hunky-dory.....right? Oh yeah, the majority of DMEs out there are doing a great job with cpap patients... aren't they?

My apologies to any good, hardworking, caring DME employees out there who really do help people effectively. Unfortunately even you good'uns probably find your hands tied way too often by store policies you have no control over.

[Guest]

[quote="snork1"]
And Guest, please refer me to a specific program a friend of mine that can't afford insurance or the overblown prices of a DME, due to losing his job, can use to get CPAP anyway. He is not able to make use of Medicare or State Disability, and has not found any of these programs you alluded to, to make healthcare affordable. Since YOU are asking people for SPECIFIC references, please give some YOUSELF.

[Patrick A]

Does any one know if Resmed is a Part of EXXON-MOBILE??