Home Sleep Apnea Testing: New Standard is Bad Deal for Sleep Docs
Sleep doctors in the U.S. have been doubling up on their Prilosec and putting their accountants on speed-dial since the federal government and insurers began signaling they plan to eventually run the $2,000-per-sleep-study gravy train off its rails. With an estimated 18 million people with obstructive sleep apnea in the U.S., the established system for diagnosis and management of OSA was seen as financially untenable (except to the sleep centers) and has long been a declared target for cost-cutting administrators.
Home sleep apnea testing is inferior to in-lab polysomnography in terms of precision. However, multiple randomized trials have showed home sleep apnea testing worked just as well as in-lab sleep studies at diagnosing obstructive sleep apnea in people with moderate-to-high pretest probability for OSA. Many in the sleep community had their fingers crossed that home sleep testing would be a flash in the pan, but among the bureaucrats and payers who effectively set U.S. health policy, it's caught fire.
At reimbursement rates as low as $86.46 apiece for home sleep studies, sleep centers haven't rushed to convert their business models to feature home sleep apnea testing. Besides the obvious financial disincentives, sleep physicians prefer the higher quality information provided by full polysomnography, and the variety of home testing devices and non-standardization of their data feeds create confusion as well.
Payers aren't waiting for the sleep community to voluntarily embrace home sleep testing, though. Insurers are simply mandating their use, in some cases suddenly cutting off the revenue streams of well-established sleep centers.
Further shifting the landscape, device manufacturers and testing companies are increasingly bypassing sleep centers altogether, sensing that their real market is the much larger pool of primary care physicians who first encounter obstructive sleep apnea patients. Auto-titrating positive airway pressure (APAP) machines are being marketed as the replacement for in-lab CPAP titration during polysomnography. Here, too, randomized trials support the conclusion that home sleep apnea testing followed by APAP treatment results in similar outcomes as sleep lab CPAP titration.
However, it still takes someone knowledgeable in sleep medicine to adequately supervise home sleep testing programs and interpret the sometimes confusing results. Here, too, insurance companies are cutting sleep centers out of the deal, instead partnering with "sleep benefits management services" to oversee the whole operation. In so doing, insurers are also establishing their control, by instituting mandatory precertification prior to home sleep testing, requiring use of their preferred home sleep testing vendors, cutting reimbursement for home sleep testing, and specifying which devices may be used.
This PCP-centered treatment pathway for obstructive sleep apnea poses an existential threat to sleep physicians and centers, most of whose business models depend on lucrative in-lab polysomnography. The initial economic results have been jarring in some areas: in early 2013, Sleep Health Centers in Boston abruptly went out of business and closed 19 sleep clinics after home sleep testing became widespread; many other sleep centers have reported a drop in polysomnography by 50% after home sleep testing emerged in their markets.
On July 1, 2013, the U.S. government (Centers for Medicare and Medicaid Services or CMS) slashed payments to durable medical equipment (DME) providers of CPAP-related devices by 47%, causing consolidation in the industry. This doesn't directly harm sleep centers financially, but will continue to disrupt existing business relationships in the sleep community and create confusion and inconvenience among patients, as stronger DME players swallow the weak.
Thought leaders have advised practicing sleep physicians to "embrace home sleep apnea testing," "become a center of excellence for the management of OSA," and change their approach "from a focus on testing to a chronic disease management model focused on improvements in meaningful patient outcomes." All good advice, but with polysomnography paying the bills, a financially successful transition incorporating such fundamental changes to their business model will be a tall order for most sleep centers. It seems safe to expect more dislocation and financial pain in the sleep community as home sleep apnea testing proliferates across the U.S.
Neil Freedman. Sleep Strategies: Time to wake up: The transformation of OSA diagnosis and management. Chest Physician, October 2013.