My correspondence with Respironics

Earlier today, I posted in the thread about the Minimum Advertised Pricing (MAP) that I had sent an e-mail to Mr. Bob Pflueger at Respironics. I'm pleased to announce that when I got home tonight, my reply was waiting in my e-mail.
I would like to publicly thank Mr. Pflueger for his reply and I urge any/all of you to respectfully express your opinions to him (as you will note in his PS to me). Even better yet, if he would care to join in our discussions, that would be wonderful, too.

Den

His e-mail addresses:

MAP@respironics.com

Bob.Pflueger@Respironics.com



This is the e-mail I sent him on March 9th.

Dear Mr. Pflueger,

A little background:
I have been a CPAP user for the last three years and an owner/user of several of your companies "Legacy" models of flow generators.....a REMstar Pro 2 and three of the REMstar Autos w/C-Flex. I have purchased ALL of my equipment from Internet/online suppliers. I would absolutely NEVER consider purchasing any of my equipment or supplies from local brick & mortar DMEs because I refuse to pay those ridiculously inflated prices for my equipment or allow my insurance provider to be billed that much. By the way, my insurance provider reimbursed me for 80% of my initial equipment purchase and since then, all my other purchases have been out-of-pocket (hopefully, I have enough stocked up to last me the rest of my life). In addition, the brick & mortar DMEs also have the worst reputations for service and support and giving out the lowest-end equipment that is not data-capable. I wanted to monitor my therapy from the beginning and have done that. My "sleep doctor" took a bad guess at my titrated pressure (he prescribed 18 cm.) and I have been using 10 - 12 cm. and have a consistent AHI of less than 1.0. I purchased the Encore Pro software in the beginning and have used it ever since. By the way, I've never used the feature in it to change my pressure.....it's easier just to push the buttons on the machine....but I hardly ever do that now that I've found my ideal pressure. I'm glad to see that your company came up with Encore Viewer, but from my experience with it, there are a few flaws that need to be addressed.
I'm not sure why people in this field of medicine are so uptight about people monitoring and tweaking their therapy.....people with diabetes do it daily. By the way, I also have Type 2 diabetes and am trying to control it with diet and exercise.....which is much, much harder than CPAP therapy.

The reason I'm writing to you is about your new "MAP Policy".
I fail to understand how raising the prices that Internet sellers have to (supposedly) charge is going to remedy the REAL problem in the industry......the brick & mortar DMEs. Has anybody wondered why there are so many CPAP/APAP/Bi-PAP users that end up on the forums? (Unfortunately, there aren't more that find them) They want ANSWERS that they're not getting from the local DMEs. They're getting screwed left and right by unscrupulous people and it's the biggest companies that seem to be the worst. In essence, you're penalizing the WRONG group. The Internet sellers have been doing an EXCELLENT job.

This therapy has a horrible compliance/success rate (according to studies)....approximately 50%. The best way to improve on that is to get the users to be more knowlegeable about it, rather than being kept in the dark. Flow generators that don't collect detailed data should NOT be manufactured......PERIOD! In my opinion, it would improve profits for the manufacturers if they limited the number of different models they produced. Far too many of the new users are given the low-end machines and cheapest masks in order to maximize the DME's profits. Then, if they're still using their machines after a few months, they're wondering why they're not feeling any better. Most of the time, they're using a nasal mask and leaking their therapy air out their mouths. Without any way for them or their doctors to monitor their therapy, they don't know about it. If they go back to their doctors, the doctor will probably increase the pressure (again, without any data to look at) and the problem continues.....until they either give up, accept their poor therapy or find the Internet user forums where they finally get help.....and become aware of how badly they've been served. Many times, their pressure is wrong, too......too high or too low because one night in a sleep lab and strange surroundings doesn't always produce good titrations. Aerophagia is a big problem for some of them to overcome, if they're suseptible to it. GERD is another.
Mask comfort/selection/fit/sizing/adjusting is extremely critical.....but very individualistic and DMEs don't seem to take that into consideration. They just hand out what's profitable.
While I'm on the subject of masks......I've used the ResMed Ultra Mirage Full Face mask since the beginning of my therapy. I tried to use one of your Comfortfull 2 masks a couple of years ago, but never could get a decent seal and it hurt my lower gums/chin area. I suffered with it for three nights before I had to give up.

Another issue is that local DMEs usually only carry one brand of product or at least a limited supply. Online suppliers, on the other hand, carry a very wide variety of products. If I want to use a Respironics CPAP and a ResMed mask (or vice versa), I may be out of luck at my local DME. Since the mask is probably THE critical component in making this therapy work, being able to have a variety of makes, models and styles is so important.

I'm also aware that this mandatory pricing scheme is also about propping up the prices that DMEs can charge the insurance/Medicare/CMS entities. This is the part that really makes me mad. The average person is being priced out of health insurance coverage because of overcharging by the various entities. There are LOTS of people who don't have insurance coverage or have very little money......that NEED this therapy......and now the big manufacturers are trying to hurt them, too. Their only option may be to buy their equipment at lesser prices.....like from an Internet seller.

PLEASE......don't do this!


Sincerely,

Dennis Wulf


These are the responses I received today.

Mr. Wulf:

I just saw your post on CPAPTalk.com (where I go weekly as a
matter-of-fact to read about what people discuss and how they're doing
with their treatment). What a great website. It's incredible to see so
many caring people there sharing their experiences and helping each
other. It's truly inspirational.

I apologize for not answering your email sooner. I definitely had every
intention of sending a reply as soon as I could.

First of all, we appreciate your business and continued use of our
products. If you chose to purchase your equipment from an online
retailer, that is great and certainly your prerogative. This is why we
support internet retailers and appreciate the high reputation most have
among their customers. CPAP.com, for example, is one of our customers
who does a fantastic job of not only providing a wide variety of
products, as you say, but also providing incredible support to patients
that purchase online.

I do respectfully object to any blanket statement or assumption relating
to perceptions of brick and mortar DMEs. Like as with any industry, each
situation is different and the full story or set of circumstances may
not always be clear. It seems that there are not two people who have had
the same experience in treating their OSA or finding their ideal mask.

Regarding our MAP Policy, it applies to advertised price. A reseller is
free to advertise that alternate pricing is available privately on a
one-to-one basis. Note this is NOT an "internet policy" because it
applies to all of our Homecare Dealers equally as well as to all types
of advertisements for the affected, MAP products.

Mr Wulf, if I can answer any other questions you may reach me on
724-387-7622. Thank you again for writing.

Regards,
Bob Pflueger


And, the PS.


Mr. Wulf:

I forgot to mention.... please encourage your fellow posters on CPAPTalk.com to email me with their questions. I read them and will answer each one to the best of my ability.

-------|-------|-------|-------|-------|-------|-------|-------|
Bob Pflueger
Sleep Disordered Breathing

Respironics, Inc.
Sleep and Home Respiratory Group
1740 Golden Mile Highway
Monroeville, PA 15146
Phone: 724-387-7762
Cell: 724-994-7043
Fax: 724-733-5893

What a great letter you wrote! I really don't understand this "advertised price" vs "private price". What the heck does that mean? We're supposed to haggle over these machines like a used car?

Well, that's amazing, Dennis! Okay, now that you have established such rapport with Mr. Pflueger, maybe you could ask him about the mysterious missing data that we all experience. I tried, just got the usual "no known issues" answer, even though I told them that this is a known issue among many, many users. Now, that would really be something if he'd get on this and get it fixed--wondering if he's even aware of the problem.

Great letter Den. I read the letter that Respronics sent to their dealers and if they intended to allow less than MSRP sales why did they close so many loop holes like allowing you to see the price in the check out cart and the other ways that a lot of internet sellers are normally allowed to operate. I am not sure that cpap.com can operate with every customer calling to check price before ordering. I'm sorry but I feel it is a copout for those that question their logic in this. I guess we will see come April 1st but I for one have a very bleak outlook on this whole thing.

Jerry

Den
Good job. I am impressed by Respironics response to. I will be sure to communicate with him.

I do not know for sure but in my opinion I think one reason equipment providers are setting minimum advertised prices is to improve price agreements for their equipment with networks, insurance companies and Medicare. My Wife recently had a knee replacement. Her hospital bill was $34.000. They were paid $12,000 by the insurance company because of the agreement between the insurance company and the hospital. I saw this same pattern with the equipment they furnished for her treatment. (Doesn't this 2 or 3 multiplier sound familiar.) Prices were inflated and then they took less because of their negotiated agreement. This seems to be standard practice but it causes a real problem for people without good insurance or who are out of network. They can go beg for a fair deal but are not guaranteed to get one even then and if they are to proud or otherwise do not negotiate they pay inflated prices. They are cought in the crossfire between the providers and the insurance companies. We will be in the same position when we buy cpap equipment direct without using insurance. I hope cpap.com and other direct companies find a fair way to work with us.
GeneS

What a great letter Den.....well thought out and well argued. My compliments!!!

I would also have to compliment Mr. Pflueger on his pretty straight forward reply. He stated his case as did you -- now whether or not we like it or not, it's out there for the reading.
It remains to be seen how the policy works in reality, but as long as cpap.com can maintain their pricing within a few percentage points, I guess it's all good.

I'm also pleased to see that someone of that caliber apparently reads what we say. That can only help Respironics understand the issues that come up to the general user. I seem to feel more that the DME's are the source of information, but perhaps that's my own perception.

Not knowing where the cost points really are it's hard to determine just how much a rip off B&M DME's really are.
My example would be that my machine, a Remstar M-Series Auto CPAP with a integrated HH sells online for $649.
My insurance company is being billed $135, per month for the "rental" of the machine and will be billed that amount for 10 months (which reminds me. The thing will be mine in a week or two). I don't know if there's some kind of balloon payment at the end, but that's a billing total of $1350, which is just over twice what I could buy it for directly (with their actual cost figured in, it would be much more than double. I'm sure the big ones get volume discounts, blah blah blah).
But as I've said before, it's not only the DME's. The insurance companies are the ones paying the freight and you'd think with the number of us out here pointing it out, they'd get a clue....
To me, that's the crux of the problem......

Again, well said Den!!!

cheers
goose

Great letter, Den.

Edited: deleted some things after reading WNJ's post.
O.

_________________

CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, cpap.com

Den,

Thank you for sharing this letter, and the reply. And kudos for a great job of, as the saying goes, bearding the lion in his own den, no pun intended! It is good for those in the ivory tower to hear from the masses every so often.

Alan

well after reading Respironics response, I think I'll take all the money I save from this new policy and put it in my monkey spaceship,

gotta do something with it, sure in the hell ain't buying another Respironics product that is for sure.

There is a discrepancy between the phone number at the end of your post and the one (with other #'s) at the bottom of the post... wonder which is the correct one?

Good letter, Den!

Mr. Pflueger’s response was polite, professional, and largely unresponsive.

I’m sure he knows that probably not one in one thousand potential Internet buyers will call to get a seller’s best price.

Note this is NOT an "internet policy" because it applies to all of our Homecare Dealers equally as well as to all types of advertisements for the affected, MAP products.

Note that the laws against sleeping under bridges apply equally to the rich as well as the poor. When is the last time you saw a newspaper/magazine/TV/radio ad by Apria or Lincare offering a REMstar Auto at a bargain price?

The fact is that only Internet sellers will be directly affected by this policy. I see no evidence that there is any purpose of this policy except to shield brick-and-mortar DME’s from price competition from Internet sellers.

But at least he didn’t insult you by saying that they were initiating MAP to ensure “service” to the end users.

Wayne

Den......Fine workmanship in the letter you wrote. Gene......excellent analysis on inflated medical industry prices.

Hopefully, CPAP.com and others will find a way around this predatory pricing problem by crafting "packages" that mix price controlled manufacturers with those who let their pricing be determined by the "invisible hand".

Gerald

WNJ wrote:Good letter, Den!

Mr. Pflueger’s response was ... largely unresponsive.

Not true!

Mr Pflueger spelled out precisely how CPAP.com can circumvent the MAP rules, a package deal mixing products from various manufacturers.

I'm waiting with baited breath for CPAP.com to introduce such a package!
Respironics APAP
F&P Humidifier
ResMed Nasal Mask
ResMed Full-face Mask
ResMed Nasal Pillows Interface

All, for an advertised price just $0.01 more than the Respironics APAP alone.

What a deal!

Regards,
Bill

NightHawkeye wrote:...to introduce such a package!
Respironics APAP
F&P Humidifier
ResMed Nasal Mask
ResMed Full-face Mask
ResMed Nasal Pillows Interface

All, for an advertised price just $0.01 more than the Respironics APAP alone.

That's business acumen on steroids IMO. Great suggestion.

Will any clever work on the part of websites will be a waste of programming time? One update to the Respironics policy and the site will have to take clever things down. The existing policy has considerable detail in it to plug some pretty clever ways of escape.

Oh, not to plug them but apneatherapy.com is complying with the manufacturers orders already. The pricing is roughly double cpap.com numbers.

So what are CPAP websites, the wave of the future or a dying relic of the past?