Purchase of durable medical equipment?
Question:
However, my insurance company says that my device, a Bi-Pap machine to treat sleep apnea requires "substantial and signficative servicing" and it is must be a rental to protect my health.
This sounds very bogus. The machine has a 2 year warranty, and it is more expensive to rent 2 year than to purhcase the Bi-pap machine now.
I filed a complaint, but my insurance company is saying they will not change this because it is their own internal policy.
My insurance says this machine is a "continous rental". Since I have this medical condition for all my life, this means an astronomical amount of money. (at least, in my perception).
How come the insurance's "internal policy" can be against what is determined in the text of my own policy? (If it is cheaper to purchase, then it should be purchased).
The reason your insurance company wants you to rent your Bi-PAP instead of buying it is because your machine can't be out of service waiting for repairs.
With it being a rental, if your machine breaks, you call your home care company, they bring out another unit, and take yours away to be fixed. So, you have another machine for a while or your old on gets replaced entirely.
Now, lets say that you own your Bi-PAP machine. If it breaks, you have to find someone willing to fix it. Then, you have to find another machine to use until yours is repaired. You would buy the machine and the home care company would have no obligation to service or repair it, if needed.
My home care instructor taught that it is safer and more practical to rent equipment. Yes, the home care company makes more money when you rent. But, you have 24 hour support from them and plentiful parts supplies.
Certain parts on your BiPAP machine are replaced routinely. The hose may be disposable. The mask is definitely disposable. Having a home care company available 24/7 to help you keep your machine running safely and keeping you with parts is important for your continued health care.
I do not support companies making money off people who need medical equipment. If they do, then good for them. My concern is about people getting and staying healthy.
Your insurance company has been suckered by the durable medical equipment companies who use the logic James explained. I was a national sales manager for a DME company, and I can tell you the rental market is a cash machine for them. These units have a retail value of around $300 and an actual cost of $100 to $150. Most insurance plans pay about $27/month in rental rates. That means the unit's retail cost is paid in less than one year. These machines are usually very reliable and last at least 3 years without any problems at all. The insurance company will pay out over $900 in that 3 year period for something that costs about $150. And people wonder why their premiums are so high.
Medicare is now looking at these long term rentals and threatening to switch to a purchase program for products like CPAP, BiPap, concentrators, etc. The DME companies are in a panic, because they stand to lose billions in rental income. DME companies are telling Medicare that they won't service these machines that are purchased rather than rented. They cite the same logic James used on you. That is nothing more than a thinly veiled threat. They don't want their gravy train to end and the only way to prevent it is to threaten to refuse service on purchased units.
What you can do is write a letter to your insurance company that does a few different things. First, find out the retail cost of your unit (easily done on the Internet). Then look at what your insurance company pays out each month in rental fees. Then look at what they pay for a 3 year period in rental payments. It would be virtually the same amount as purchasing you a new unit every year. They aren't saving anything. They would be better off buying the unit and replacing it after the factory warranty expires. If the unit breaks for any reason, you could still "rent" one in the interim from a DME company. If the DME company refuses to rent to the insurance company's members, the insurance company just needs to threaten to remove the DME company from their panel of providers. Believe me, when threatened with expulsion, they will happily provide the member with a rental unit. No DME company is going to risk losing an entire contract over the rental of a machine for a month while a factory repair takes place.
Your insurance company is basically lighting your premium dollars on fire. This was nothing more than a back room agreement between two "friends" - nothing in writing, just a loop hole that is being exploited. If your insurance company doubts the reliability of a unit, all they have to do is contact the actual manufacturer and get the failure rate of the units in the first year, second year, etc. If some units are substandard, then they can request that the DME company provide only particular brands. If the DME company refuses, then again, simply remove them from the provider panel and find another DME company.
I think you have already done the math and figured out you and your insurance company are getting taken to the proverbial cleaners. Maybe you should have a talk with your HR department and see if another insurance company might be a better idea. Companies spend an inordinate amount of money for insurance for employees. Doing business with one that has bad business practices is a bad business practice in itself. Most insurance companies actually are switching to a purchase model versus the old rental model. It just makes better sense and it is a much better use of your premium dollars. Good luck to you in your quest for sanity. The relationship between ancillary providers and the contracting arms of insurance companies can be as corrupt as any in the business world. These "deals" can be hard to fight.
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