Plan would limit sleep partnerships

Tuesday, September 30, 2008

WASHINGTON--The American Academy of Sleep Medicine (AASM) in August called a CMS proposal that would limit who could bill for CPAP “unnecessarily prohibitive and one that ultimately compromises patient care.”

Under CMS proposal 1403-P, Medicare would not pay DME providers for a CPAP if the provider is affiliated directly or indirectly with the lab providing the sleep test.

“Affiliated is the wild card here,” said Clay Stribling, an attorney with Amarillo, Texas-based Brown & Fortunato. “We are hoping that they give us a more detailed definition of affiliate, but I think we can assume that would include some common ownership-type relationships where the individual that owned the sleep lab owned the DME.”

Medicare policy already prohibits providers from providing the test and the equipment, but as long as the sleep lab and the DME are separate legal entities, it’s permissible.

“Presumably, this would close that loophole and eliminate some of the common owner relationships,” said Stribling. “It all depends on how they define affiliate. There are a lot of contractual relationships out there between DMEs and sleep labs.”

In comments submitted to CMS, AASM also stated: “(We are) unaware of fraud or abuse issues related to the distribution of CPAP... at facilities accredited by the AASM.”

Also weighing in was the American Sleep Apnea Association.

“If the organization offering diagnostic services as well as providing the therapeutic equipment does so in the context of providing a disease management program and can demonstrate they are providing a seamless continuity of care, then no restriction should be placed on their ability to provide both services,” stated Executive Director Ed Grandi.