Last week, home testing took a step closer to becoming a covered benefit under CMS reimbursement criteria. A decision memo from CMS proposed “to expand coverage of CPAP to include those beneficiaries with a diagnosis of CPAP made using a combination of a clinical evaluation and unattended home sleep monitoring using a Type II, III or IV device.” A final determination is set to be issued after CMS reviews public comments on the issue.

Although the decision signals a change in direction for the diagnosis of OSA, the announcement didn’t come as a shock to many in the industry. “My initial reaction confirmed what I suspected would be the outcome of the decision,” said Robert D. Hoover, Jr, MD, MPH, chief medical officer, DeVilbiss Healthcare, Somerset, Pa, and also a nonvoting panel member of the 2004 panel that considered home testing. “CMS has opened the door to home studies, thus enabling more patients to be diagnosed with obstructive sleep apnea.”

The gist of the decision was expected by many industry insiders, but that’s not to say that the proposal did not come without a few curveballs. The inclusion of Type IV devices and the initial coverage limitation were a couple of unanticipated outcomes. “I was a bit surprised that they included Type IV devices as acceptable for use. Those devices typically have fewer monitoring parameters and less diagnostic precision than Type II or Type III devices,” says Hoover. “I’m also intrigued by the initial coverage limitation of 12 weeks. There was no mention of how that would be monitored or documented, which will likely leave that decision up to the contractor medical directors.”

Interestingly, also missing from the proposal was instruction about home titration. Home titration with an autoadjusting CPAP unit is an essential component of home portable monitoring and diagnosis of OSA. “Since this was a draft decision that is open for comments, I suspect CMS is awaiting comments from the provider and physician community on this important issue,” says Hoover.

Potential Impact

If home sleep testing assumes a major role in the diagnosis of OSA, some sleep lab owners are concerned that the difference in reimbursement could impact profits. Others have predicted that an increase in patients could offset differences between in-lab PSG and home testing reimbursement rates. “Access to more diagnostic capabilities, at a lower cost and greater convenience to the patient, is likely to encourage more patients to be tested and treated,” Hoover says.

Another concern that needs to be addressed is who can conduct home tests. “If the final ruling does not include restrictions on who can conduct these tests, a home sleep service industry that employs qualified members outside the sleep community may be created, spurring growth in other medical professions, particularly the respiratory care community,” says Hani Kayyali, president of CleveMed.

Lab owners will have to wait for the final ruling for clarification on the above-mentioned issues. As for the patient population, many are calling the announcement a win. “I believe it will ultimately be in the best interest of OSA patients,” Kayyali says. “Having said that, however, all parties involved, patients, physicians, insurance companies, equipment manufacturers, and DMEs, must exercise caution. While access to diagnosis will now improve, we must ensure that patient care is not compromised.”

Proposed Changes

In the proposed decision memo, CMS outlined the following changes to its National Coverage Determination (NCD) for CPAP:

1. We are proposing that, due to the evidence demonstrating that no combination of diagnostic procedures adequately identifies all of those beneficiaries who will benefit from CPAP, the coverage of CPAP is initially limited to a twelve week period to identify beneficiaries diagnosed with OSA as subsequently described who benefit from CPAP. CPAP is subsequently covered for those beneficiaries diagnosed with OSA who benefit from CPAP during this twelve week period.

2. We are proposing that the use of CPAP will be covered when diagnosed using a clinical evaluation and PSG performed in a sleep laboratory. In addition, we are proposing to expand coverage of CPAP to include those beneficiaries with a diagnosis of CPAP made using a combination of a clinical evaluation and unattended home sleep monitoring using a Type II, III, or IV device.

3. We are proposing to modify the criteria for a positive sleep study to remove the requirement for a minimum two hours of continuous recorded sleep and instead recognize shorter periods of continuous recorded sleep if the total number of recorded events during that shorter period is at least the number of events that would have been required in a two hour period.

4. We are proposing to delete the current distinct requirements that an individual have moderate to severe OSA and that surgery is a likely alternative because these terms are not sufficiently precise.

5. Due to a lack of sufficient evidence that clinical diagnosis alone or clinical diagnosis in combination with devices other than Type I, II, III, or IV adequately identify beneficiaries with OSA that will benefit from CPAP, we are proposing to expand Medicare coverage for CPAP in these instances only when provided in the context of a clinical study when that study meets the following standards:

A clinical study seeking Medicare payment for CPAP provided to the beneficiary pursuant to Coverage with Evidence Development (CED) must address one or more of the following questions:

1. In Medicare aged subjects with clinically identified risk factors for OSA, how does the diagnostic accuracy of a clinical trial of CPAP compare with PSG and Type II, III & IV HST in identifying subjects with OSA who will respond to CPAP?

2. In Medicare aged subjects with clinically identified risk factors for OSA who have not undergone confirmatory testing with PSG or Type II, III & IV HST, does CPAP cause clinically meaningful harm?

3. In Medicare aged subjects with clinically identified risk factors for OSA, how does the diagnostic accuracy of tests other than PSG or Type II, III & IV HST, such as oximetry, peripheral arterial tone and actigraphy, alone or in combination, compare with PSG and Type II, III & IV HST in confirming a diagnosis of CPAP-responsive OSA?

Read the entire announcement by clicking here.