How close is Resmed's MIRP to brick and mortar MSRP?

[gdpeck]

Trying to arm myself with some pricing information. One reason for setting strict online price controls such as Resmed's MIRP (Minimum Internet Retail Price) is to protect brick-and-mortar shops and put every business who sells a given product on an equal playing field, at least as far a pricing. There are other reasons as well, and I don't know what motivation Resmed might have for this policy.

I'm wondering how close the MIRP pricing is to the price I would expect to pay if I were to buy Resmed equipment from a DME. For example, if I walk in to a DME with prescription in hand for an S9 Autoset, H5i humidifier, and climateline hose, and pay cash for it, how much would that cost? Would it be close to what I would pay at an online retailer? Or do the online stores still have a price advantage over brick-and-mortar? Does anyone have any actual experience with this, or have heard from Resmed, or an online store that their is pricing parity with the new policy?

Thanks!
George

[6PtStar]

Most of the time the Brick and Morter DME's price is about double what the Internet Retail Price is. They justify the difference by saying they provide the service that goes with the machine/ mask that you don't get from the internet supplier. Some do some don't!!

Jerry

[jules]

it will vary - some things might be double, some triple, some even 5 times the cost - it will also vary with competition in the local marketplace whether you go to a Mom and Pop DME or a big chain one

I would suggest calling some DME's and checking their prices

[Maple Leaf]

My machine from cpap.com - $550.00 from DME in Kamloops, B.C. - $3,000.00. Yes, some of the DME's like to stick it to the customer/patient. I went to a DME in Vancouver and got the same machine for $1,600.00 so as you can see, prices can be all over the map. My insurance provider would not cover an internet purchase so I had no other option.

[fiberfan]

There is another issue for DMEs who accept medicare. They can't sell to a cash customer for less than they bill medicare. Many insurance companies also play this game. I paid ~10 more for a S9 climateline hose from my DME than the cost on cpap.com.

[mattman]

Fiberfan has it.

It's not so much "The DME trying to stick it to you" it's that most DME providers are forced by clauses in the Insurance Company contracts to sell to cash customers for the same price that the Insurance Companies have pre-set as the submitted amount.

So, Insurance Company sets the submitted amount at say, $2,000.00 for a CPAP Machine. That's the price the DME company has to submit to them on the claim form. The Insurance Company then sets the allowable rate, meaning the price they will actually pay at maybe 40% of that, so they actually pay $800.00. But the Insurance Company also sets up a "Best Price" clause that says the DME cannot sell that HCPC code to anyone for less than the price outlined in the contract.

Therefore the DME will have to charge a cash customer the full $2,000.00.

It sucks and it is horrifically unfair to anyone who wants to pay cash but it's not a deliberate attempt to screw anyone (Except maybe by the Insurance Companies).

mattman

[ozij]

<snip> The Insurance Company then sets the allowable rate, meaning the price they will actually pay at maybe 40% of that, so they actually pay $800.00. But the Insurance Company also sets up a "Best Price" clause that says the DME cannot sell that HCPC code to anyone for less than the price outlined in the contract.

Therefore the DME will have to charge a cash customer the full $2,000.00.

It sucks and it is horrifically unfair to anyone who wants to pay cash but it's not a deliberate attempt to screw anyone (Except maybe by the Insurance Companies).

mattman

If the insurance companies wont' let DME's sell uninsured people at the allowable price isn't that a way of trying to force uninsured people pay far more than the insured ones - and far more than the insurance company?

[unadog]

The irony, of course, is that it costs the DMEs a lot more to create insurance records, cut paperwork, bill the insurance companies, track payments, followup, and use working capital while waiting for a payment from an insurance company than to sell for cash. In the "real" (logical) world, you would get a discount for paying cash!

Mattman, are there local/state "insurance" groups that are eligible for the same pricing as insurance? Obviously the DMEs have agreements with multiple insurance companies, or they would have to "exclusively" work with BCBS, for example.

We need the "Honarary I Pay In Cash Self Insurance Company" membership card. Pay a $5 annual fee and they will sign a contract with all the DMEs.

Michael

[Jaime D.]

If I want my insurance company to pay anything after I've satisfied my deductible, I have to purchase from a specific supplier. I can pick up the telephone and instruct my supplier to send a specific mask and they will bill the insurance company, UHC, 94.71 for the silicone mask.

If I have not satisfied my yearly deductible, UHC subtracts the 68.03 network discount and leaves me with a 26.68 to pay for the mask.

If I was out of my mind and wanted to purchase 2 masks in the same 30 day period, I would have to pay $94.71 for the second one.

That's $40 above the MIRP of $54.

Please note that I find it interesting that a manufacturer can NOT tell a brick and mortar merchant what retail price to charge; they can suggest a retail price.

[sleepydawn]

My S9 is $1500 at the DME and it's about $853 at the cpap.com. I was charged separately for hose and humidifier but I don't recall how much for those.

[jonquiljo]

If the insurance companies wont' let DME's sell uninsured people at the allowable price isn't that a way of trying to force uninsured people pay far more than the insured ones - and far more than the insurance company?

Different insurance companies contract different rates with different suppliers, vendors, ad providers. I don't believe that the supplier (in this case a DME, but it could be a Dr. or sleep center) is not allowed to charge the negotiated rate - it's that they don't want to charge the negotiated rate. Basically insurance companies get discounts and uninsured or cash customers pay "list price". The predominant customer for any service or supply is an insurance company - so everyone pays full price for cash.

For instance I have crappy insurance (long story - can't get any better for any price) so lots of things for my wife and myself are not "allowed" by the insurance company. If we think it is important to have - a medicine, a Dr. visit, a procedure, or equipment - we have to pay on our own for it. We always have to pay the marked up price when we self-pay. It stinks but that's the system.

This is one of the big problems with the US insurance/medical system. It's all about insurance companies running the show - and reform is not going to change that. The costs of everything are inflated and the real costs are hidden from view. Yes, the costs of medicine have gone up in recent years - but nothing like what is actually charged. The system is inflated in cost and everyone builds inefficiency into their business or service that eats up all these inflated costs.

If I could have a simple "plan" that just allowed me to buy services, procedures, tests and equipment at the "negotiated rates" insurance companies pay - it would be far more effective to self - insure than to pay for an insurer - unless i had a catastrophic event. But these things don't exist. And our government allows this price game to continue - so we all lose.