Cost of equpment

DenotenatorPlus · Post by **DenotenatorPlus** » Sat Dec 09, 2006 10:23 am

I'm curious about DME supplier prices compared to Internet vendor costs. My DME supplier is billing the CPAP, mask, and tubes at amounts far far greater than the prices shown at reputable vendors online. My insurance will probably pay for 100% (Medicare and supplemental insurance), although I am going to check on that Monday.

It this a usual business practice?

DreamStalker · Post by **DreamStalker** » Sat Dec 09, 2006 10:25 am

Welcome to the US healthcare system ... maybe now you will see that it is a broken system.

curtcurt46 · Post by **curtcurt46** » Sat Dec 09, 2006 10:33 am

That's the way it works. Most insurance companies have predetermined prices they will pay. I always wondered why they don't just bill the amount they know they will be paid.
Also, with Medicare they will probably rent on a monthly basis. I don't know if they offer a rent to purchase anymore.

neversleeps · Post by **neversleeps** » Sat Dec 09, 2006 10:45 am

Amazing, isn't it? Here's a copy of a post from June 2006 showing some examples of the disparity between what the brick and mortar DMEs charge and what the online DMEs charge for identical equipment.

Price using a traditional DME: $2232.65
Price of identical equipment using online DME (cpap.com):$718.75

(see: viewtopic.php?p=36815#36815)

Price using a traditional DME: $1200.00
Price of identical equipment using online DME (cpap.com):$199.00

(see: viewtopic.php?p=36811#36811)

Price using a traditional DME: $2900.00
Price of identical equipment using online DME(cpap.com):$1000.00

(see: viewtopic.php?p=8449#8449)

Price using a traditional DME: $1850.00
Price of identical equipment using online DME (cpap.com): $800.00

(see: viewtopic.php?p=8564#8564)

Price using a traditional DME: $2500.00
Price of identical equipment using online DME (cpap.com): $325.00

(see: viewtopic.php?p=9294#9294)

Price using a traditional DME: $2500.00
Price of identical equipment using online DME (cpap.com): $650.00

(see: viewtopic.php?p=78986#78986)

Price using a traditional DME: $3400.00
Price of identical equipment using online DME(cpap.com):$1569.00

(see: viewtopic.php?p=79010#79010)

snoregirl · Post by **snoregirl** » Sat Dec 09, 2006 11:52 am

In defense of the DME's (wow, did I say that?) they are recouping costs for

RT's that sit with you and answer questions
Travel to deliver equipment in some cases
Deal with return customers and their issues
Mask exchange costs where customers come back dissatisfied with interface
Machine exchange issues where a customer given a basic vanilla machine comes back with knowledge requesting a data recording machine or APAP (could be lessened by providing higher level of machine rather than trying to stick people for the base machine)
Swapping machines for patients who have issues that require bilevel or the like
Insurance billing issues (online prices are cash only, you deal with insurance if you can or not)
Maintaining a store front

Now we all have our own opinions as to how much each of these services are worth, who should be paying for them, how they are being paid for (currently spread over the cost of all patient's machines whether or not you use the service) etc.

Add this to the issue of the way medicare billing is done and you have the difference.

Yes, I believe the system is poor. But that is the basic explaination you asked for between online vendors and brick and mortar DMEs pricing

yardbird · Post by **yardbird** » Sat Dec 09, 2006 12:23 pm

this is not a rebuttal and I agree with snoregilr that when you have higher overhead, you have to mark things up...

HOWEVER (there's always a "however", ain't there?)

My DME gave me LOUSY service, a CHEAP machine, and never checked in to see how it was going. They gave me NO consultation, NO support, and my sleep doc was just about as bad. Go to his office for a follow up, fill out a form with multiple choice questions about how likely I am to fall asleep in certain situations..... not much discussion and any mention of discomfort or problems were met with the standard, "you'll get used to it" response.

cpap.com, on the other hand, answered all my questions patiently (no pun intended) and made sure I was ok with all aspects of what I was purchasing. email or phone questions later got almost immediate results/response.

In short I've gotten MUCH better handling at the "online store" than at the local DME. ... MUCH better. In fact.... (cpap.com please don't let this go to your head)... cpap.com personnel are the reason I am back on cpap and 100% compliant. That's no lie.

Now while I'm sure there are good brick and mortar DMEs out there, the markups are pretty near robbery. I work in retail that also does service. Pick up and delivery, repair and consultation. And our markups are kept to 20% or less.

Sorry... it irks me a bit when I hear how much the local DME is doing for me when mine has done nothing. And I've dealt with 3. And again... my experience. Your mileage may very well vary.

snoregirl · Post by **snoregirl** » Sat Dec 09, 2006 12:34 pm

Yardbird

I basically agree with you and buy all my stuff (other than the original machine and a couple parts I could get cheaper with insurance from the DME this year only) from CPAP.com. Next year an on it is all Cpap.com...

I do think that the DME's have their share of customers that need hand holding and the online stores, while they provide great phone help, don't take back machines, don't exchange masks (unless you buy the insurance) and much of the support is through forums like this that cost little to maintain.

Are the Brick and mortar prices justified? I seriously doubt it, however I haven't seen the books so I can't make a fair judgement when you consider their total business. What I do know is that on a customer like me they are making a bundle.

ColoZZZ · Post by **ColoZZZ** » Sat Dec 09, 2006 1:37 pm

I'm fairly new at this but I've gotten the understanding that the DME may BILL one amount but the amount ACTUALLY PAID BY the insurance company is often significantly less. This, combined with the support provided by the DME listed by snoregirl would probably lower their profits from our perceived "Obscenely profitable" level to merely "Highly profitable."

If anyone can verify this, please chime in (mattman?).

--Andy

snoregirl · Post by **snoregirl** » Sat Dec 09, 2006 4:30 pm

what they actually are paid by insurance companies is still 2 - 3 times or more than the cash online prices. I didn't even consider the billed price in my previous response.

Example insurance (and my copay) for a Remstar Auto was about $1350 or so without the humidifier. The humidifier was over $300. I didn't go back to my bills for the exact numbers but they are pretty close. Online the Auto plus humidifier combination is currently $689.

As you go down towards the base CPAP models the disparity grows.

yardbird · Post by **yardbird** » Sat Dec 09, 2006 6:04 pm

snoregirl-

your experience and mine are similar. My insurance company will PAY $1,385.15 for a cpap machine. (no humidifier). I have a 50% copay using a participating DME. I get NO REIMBURSEMENT AT ALL if I buy from cpap.com or any other DME that is not a participating one...brick and mortar or not. I have to pay 50% of the ALLOWABLE billable which is that $1,385.15. That's $692 and some change out of my pocket if I remember correctly. Now keep in mind that even if they give me something like a REMStar Lite straight CPAP machine which costs only $247.50 from cpap.com, the local DME will STILL GET PAID $1,385.15 because both that auto machine and the straight cpap machine get billed under the same billing code to the insurance.

I can get the REMStar Auto with c-flex for $599.95 from cpap.com. A savings of almost $100 to get what I want and just pay for it. Now of course if your insurance covers 100% of durable medical equipment then this isn't an issue. I think everyone has to work out the numbers based on their situation. For myself... every 5th year or so I just stick an extra $600 in the medical flex account and pay pre-tax cash for my medical equipment.

I can switch medical plans at work to one that gives me 50% reimbursement even OUTSIDE the plan, but that's after meeting a $250 deductible. I'm considering it. Any year when I don't buy a machine, I *might* cover the deductible in purchases of allowed masks, replacement pillows/cushions, filters, etc. But every 5th year or so I'd only pay HALF of the cost of the machine so a new remstar auto would only cost me about $300 out of pocket instead of $600 (assuming I've met the deductible for the year) . I have to see what else gets affected if I switch plans, but as I said.... this needs to be looked over based on your particular situation.

KimberlyinMN · Post by **KimberlyinMN** » Sat Dec 09, 2006 7:07 pm

I was initially quite put out when I found out how much more the DME was charging for everything. (Well, I still am.) I was one of those who had to exchange the CPAP for a Bi-PAP. If I had purchased the CPAP online, I'd be stuck with the CPAP and have to buy the Bi-PAP as well. (Although I could resell the CPAP as a used unit here or something.) My monthly rental for the CPAP came to about $30 a month for two months and then my rental for the Bi-PAP was the same, although I'd already hit my out of pocket maximum. The total amount that I've paid the DME was about $149 -- because I'd already hit my deductible before the sleep study. The study itself was billed through my regular doctor so I'm not including that amount in the $149 (and I can't remember what that was!). The Bi-PAP machine will be billed to my insurance this month so that's covered 100% (because of hitting the out of pocket maximum).

I think I was lucky, however, that the DME I go to is pretty good with their customer service. (Although they don't have a mask exchange policy.) I did find it odd that they didn't know anything about the ComfortCurve nasal interface though.

Kimberly

snoregirl · Post by **snoregirl** » Sat Dec 09, 2006 9:14 pm

Yardbird,

I am luckier in the insurance area than you are. I am only 20% copay, but since I don't have many other medical bills that go to deductable, I don't expect to get masks or tubes with insurance again any time soon.

Also, like you my insurance refuses to give any benefit for online cash purchases.

Catnapper · Post by **Catnapper** » Sun Dec 10, 2006 5:52 am

I found out that my insurance pays for masks, mask parts, and hoses on the same schedule as Medicare. That means that the insurance will cover a new hose every month, a new cushion for the mask every month, I think it covers 2 sets of nasal pillows every month (not the mask, just the little nose pieces), a new mask every 6 months, and after 3 months, you can get all the parts of a mask except the headgear. Of course you have to consider the copay amount when you go this route and whether you have paid the deductible already.

The DME tells me that he will sell me any equipment at the same cost as the insurance will pay. (As if that is a bargain.) I think he means compared to the even higher Suggested Retail Price, which is even more inflated.

I just discovered this news this week when the DMe called to tell me that they have the new humidifiers for the M series machine. Since I have been past the 3 month mark, I can get all the parts of a new mask except the headgear, but I can buy the headgear out of pocket. Before I go, I will price the headgear and mask parts and take my calculator to see if the cost works out to my advantage.

You may not need a new hose every month unless you have pets that like to chew or claw on it, but it is nice to have an extra hose in case the current one breaks.

My insurance does not give any reimbursement if I buy this equipment out of pocket. That is another part of your cost consideration. You also have to consider shipping costs in online purchases, and cpap.com gives free shipping if you buy more than $100 worth of stuff.

Who knew you would need so much information and calculation to get the equipment you need?

Oh yes, the humidifier reservoir is the newest attempt to resolve the M series leak problem. My humidifier only leaks if the pressure goes above 13 or 14 cms, and I am lucky that doesn't happen very often. I make this statement based on what the software shows me. Who knows if that is accurate? I will let you know in time how the new fix works. If you had not prepared for the leak you may have to add the cost of repairing the damage from the leak!

Catnapper

Guest · Post by **Guest** » Sun Dec 10, 2006 11:32 am

The amount billed by the provider has no effect at all on what Medicare or insurance will pay. Each insurer has an established allowable and that is all that they will pay regardless of what is billed. When the provider signs on with an insurer they agree to accept the insurer's allowables.

Snoredog · Post by **Snoredog** » Sun Dec 10, 2006 11:49 am

[quote="yardbird"]snoregirl-

your experience and mine are similar. My insurance company will PAY $1,385.15 for a cpap machine. (no humidifier). I have a 50% copay using a participating DME. I get NO REIMBURSEMENT AT ALL if I buy from cpap.com or any other DME that is not a participating one...brick and mortar or not. I have to pay 50% of the ALLOWABLE billable which is that $1,385.15. That's $692 and some change out of my pocket if I remember correctly. Now keep in mind that even if they give me something like a REMStar Lite straight CPAP machine which costs only $247.50 from cpap.com, the local DME will STILL GET PAID $1,385.15 because both that auto machine and the straight cpap machine get billed under the same billing code to the insurance.

I can get the REMStar Auto with c-flex for $599.95 from cpap.com. A savings of almost $100 to get what I want and just pay for it. Now of course if your insurance covers 100% of durable medical equipment then this isn't an issue. I think everyone has to work out the numbers based on their situation. For myself... every 5th year or so I just stick an extra $600 in the medical flex account and pay pre-tax cash for my medical equipment.

I can switch medical plans at work to one that gives me 50% reimbursement even OUTSIDE the plan, but that's after meeting a $250 deductible. I'm considering it. Any year when I don't buy a machine, I *might* cover the deductible in purchases of allowed masks, replacement pillows/cushions, filters, etc. But every 5th year or so I'd only pay HALF of the cost of the machine so a new remstar auto would only cost me about $300 out of pocket instead of $600 (assuming I've met the deductible for the year) . I have to see what else gets affected if I switch plans, but as I said.... this needs to be looked over based on your particular situation.

Cost of equpment

Cost of equpment

cost of equipment