No deals with the local DME

[snoregirl]

Call me petty, but I resent my $$ paying for oxygen stuff that I don't use.

I don't want the whole profit/loss of a DME balanced on my money.

I want a reasonable price for what I get not what the whole sales picture of a DME is.

[dataq1]

It's the INSURANCE company that sets those prices, NOT the DME.

I’ve only talked with three DMEs and my BCBS insurance but all agree that the providers charge is determined by the provider alone. They all agree that the DME can claim any amount they wish.

HOWEVER, they all agree that the amount the Insurance company will allow is based on contract between the insurance co and the DME. That contracted amount varies from DME to DME as a function of the specific contracts. The contracted amounts is highly influenced by Medicare, however it’s the DME that actually accepts or rejects the insurance companies proposed allowable payment. So its not quite as simple as …. The insurance company sets the price.

10%.....30% of the "allowance"? What does THAT mean?

What's their definition of a "licensed provider"? CPAP.COM is actually considered a DME provider.....

Ask them just why in the H*LL they're so intent on wasting your insurance premiums

The allowance is what the Insurance company and the DME have agreed to settle on. The old terminology was “Reasonable and Customary”. What I fail to understand is why the allowance should vary so widely.
For example: for exactly the same product, the allowance is $173 for one DME and $103 for the other DME.

The 10% of allowance simply means that I will have to pay the DME 10% of the allowance, etc.

CPAP.COM is a licensed DME.

Wasting my insurance premiums. Yeah, I’m puzzled about that also. But here’s one thought. My employer is the one who actually pays for my medical expenses. It is a self-insured program. They have hired BCBS to manage those payments. BCBS gets paid a management fee based on the dollars that the (BCBS) handles for them. My cynical self says, if BCBS pays out more they get paid more.

[mattman]

Why the hell do you think I'm constantly putting myself in front of the firing squad on this board?

Honestly, that's a mystery to me, too.

Because I want to help people, same reason I do what I do. Going to sleep at the end of the day knowing I made someones life better makes me very happy.

mattman

[mattman]

Call me petty, but I resent my $$ paying for oxygen stuff that I don't use.

I simply could not agree more. That sums up much better than I have basically everything I've been saying is wrong with the Insurance business we currently have to deal with.

Thank you for putting it so perfectly.

mattman

[mattman]

It's the INSURANCE company that sets those prices, NOT the DME.

... however it’s the DME that actually accepts or rejects the insurance companies proposed allowable payment. So its not quite as simple as …. The insurance company sets the price.

Aren't we just saying the same thing though?

When I have say, BCBS, come to us saying 'We are moving into your area with a new plan. Here is a list of everything you can provide and what you will be paid for it. If you don't like it then you can't provide any services for BCBS patients and we will go elsewhere.".

That's basically exactly how it works right now. Isn't that summed up by saying 'The Insurance Company sets the price.'?

mattman

[Wulfman]

Maybe it would be more appropriate to say "the insurance company/provider sets the LIMIT on what they will pay".
If they are billed more than what their limit is (and they catch it), they will pay up to that amount.

What is "reasonable" and what the "limit" is, is where I have my problem with those who bill the insurance provider.
When I got my "paperwork" from my group plan, what the doctors, clinics and others had billed was considerably higher than what they actually collected from my insurance. At the time I wondered "What happened to the difference?" Somewhere through the process, I sort of figured it out......but it still leaves me wondering WHY?......why do they bill more than they know they're going to collect?

Den

[mattman]

but it still leaves me wondering WHY?......why do they bill more than they know they're going to collect? Den

That's one of the things I also think is stupid and what I keep hammering at in many of my posts.

It's because in nearly all cases another one of the little things the Insurance Companies do is to specify that they will only pay a percentage of every claim submitted to them.

So for example with our Cigna contract they will only pay 60% of the charge submitted to them (or the allowable whichever is lower). If they have told us the amount paid for a pair of crutches is $16.00, and we actually bill the $16.00 like they tell us to, we would ACTUALLY only get $9.60. So in order for us to hit the $16.00 specified we have to bill $26.66.

Obviously when you get up to the dollar values of CPAPs and such the amounts get much more out of whack. We have 1 policy that pays 40% of claims and reimburses about $900.00 for a CPAP. So to hit the 900 allowable we actually have to bill $2250.00. How stupid is that?!!

mattman

[Wulfman]

Well, we all know the system is broken.

SO......"Stupid is as Stupid does".

Thanks for that information on insurance payments.

Den

[Slinky]

Correct me if I am wrong here, MattMan, but, the majority of DMEs could not survive WITHOUT insurances. There just aren't enough uninsured but financially able to pay patients to keep the DMEs afloat.

Whilst insurance is a boon to the insured to get adequate medical care, insurance is one of THE MAJOR reasons health care costs have skyrocketed. If not, perhaps THE major reason.

[mattman]

Well, we all know the system is broken.
Den

AMEN to that brother!! Now you start to get the idea of why I'm constantly waving the "Insurance Reform' banner!

mattman

[mattman]

Correct me if I am wrong here, MattMan, but, the majority of DMEs could not survive WITHOUT insurances. There just aren't enough uninsured but financially able to pay patients to keep the DMEs afloat.

Whilst insurance is a boon to the insured to get adequate medical care, insurance is one of THE MAJOR reasons health care costs have skyrocketed. If not, perhaps THE major reason.

Without a doubt you are correct. In fact, most DME companies aren't even very well able to deal with cash paying customers.

However - I still strongly believe the Insurance system is broken. Again I go back to the case of paying 200% over cost for 1 item (A CPAP) but paying 50% BELOW cost for another. Yes in the big picture it evens out to a fair profit for aggregate of all items but it's an insane way to do business.

PLUS you then throw in that nifty little clause that requires a provider to charge cash customers the same as the Insurance company and the poor guy stuck paying the 200% price (read: CPAP) gets screwed.

I firmly believe that a great deal of the costs could be contained if the system was reformed. Set a fair profit margin for all items.

mattman

[dataq1]

Why do they bill more than they know they will actually get?

Years ago, the "reasonable and customary: cost of medical good and services was established by historical data, within a zipcode, and that historical data was the providers charges. According to the insurance industry (again several years ago) the "reasonable and customary" pricing was the average pricing (after rejecting outliers) and lagged the current pricing by about three years. This was no secret, providers and clients knew it, so the providers would normally charge some value in excess of the "reasonable and customary" so as to influence the future pricing. As one surgeon told me, "it's the only way we can get a raise".

None of the insurance companies I've been able to establish connections with will admit or deny that this is the process today. They do insist that it is the decision of the provider (a DME, in this case) to either agree to a allowance schedule or not.

I still don't understand why a supplier would be willing to discount his product or services so that he is selling for a loss. ---Unless he is making it up elsewhere.

[Slinky]

Well, I'm just glad that it is my 02 DME that I am "stuck" w/for 3 years capped rental on my 02 concentrator instead of being stuck for 3 miserable years w/my xPAP DME!!! At least I'm "only" stuck w/the xPAP DME for 13 months capped rental. And THAT is 14 months too long!!!

[tomjax]

I think it is very unfortunate that some take out their frustration with DMEs on Mattman.
I hope he does not throw up his arms and leave,
I appreciate his DME perspective and consider him a very valuable poster.
But then again, some seem to attack just about anything.

Give it a rest.
tomjax

[Slinky]

I agree, TomJax, and I wasn't picking on MattMan. He's been very helpful to me and certainly very patient and even tempered given some of the responses and comments he has received here.